Questions and Answers to Starting a Joint Venture

To form a joint venture or not to form a joint venture: that is the question. Joint ventures are a strategic alliance and partnership between you and another entrepreneur for a specific business purpose. Profit is generally the biggest motivation for forming a JV, but there are other reasons – which is why you should ask yourself some important questions before you begin. Here is a small sample of questions you should ask yourself:

What do I sell?

Are you a service or a product-oriented business? What you sell can play a large role in choosing a JV partner. Product-oriented businesses are more likely to pair up into JVs since there are numerous ways of combining contrasting and similar merchandise, such as package deals, coupons, free samples, or even a new joint venture product. These have been proven ways to a successful JV relationship when two types of products are sold jointly. Respective customer bases are introduced to another product and receive more benefit with package deals and reduced prices.

Of course, this is not to say that service businesses can’t benefit from a JV. In fact, services can certainly combine forces. Consider a neighborhood hair salon owner giving their customers a great deal on organic hair products produced by another local entrepreneur. Sit down and get creative. Think about how your product or service could combine synergistically with other types of businesses.

How do I reach my target market?

Who is your target market? You should know. Any business that will survive needs to know their demographic customer base. A JV can help you get more products into the hands of your target customers.

Consider a skateboard company who sells boards, accessories, and apparel. How can this business owner expand? Perhaps a strategic alliance and JV with a local chain of surf stores is the answer, as the demographic is similar. Consider how you can reach more of your target market with a strategic JV.

How am I working against my competitors?

Who are your competitors? Is your slice of the market share growing? Are you at a plateau, or even shrinking, while your competitors continue to edge you out of the pie chart?

Joint ventures will open markets, generating new customers and even reaching your competitor’s customers. Consider if a JV can give your business more clout and more credibility. With access to a larger market base and an improved reputation, your business can soar above the competition.

Take for instance a local fish and tackle store. An alliance and JV with a national brand, such as the American Sportfishing Association or the American Fly Fishing Trade Association, could add tremendous clout that would attract bigger customers and take back your desired market share.

The key thing to remember is that your JV is a strategic alliance with another business.  Don’t go headlong into a JV without a purpose and a goal. The more questions you ask yourself, the more prepared you will be to move forward into a JV.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

Control Your Risk in a Joint Venture

We know that joint ventures are a great strategy to join forces with a partner and form a win-win business deal. But are all JVs winners? And what are the risks involved if you do become part of a JV with another business owner?

Risks are present in all aspects of business. Forming a strategic alliance in the form of a JV is no different. However, with all success in life and business, controlling the risk is the important task. What can you do to control your risk as part of a JV and make it a success?

First, you need to identify the potential risks. What do you value as a business owner? Here are some typical values that could be at risk with a JV partnership:

• Time
• Money
• Technology
• Credibility

Avoid the Risk of Losing or Wasting Time

The great businessman, Benjamin Franklin, stated that “time is money”. Every minute you spend on your business should be in the pursuit of forwarding the success of your business. You spend time each day creating and building relationships, selling goods and services, hiring and training valuable workers to perform the tasks of your business, etc.  If your time is lost, then your business suffers.

Rather than waste time with a JV that is destined for failure, you can control this aspect by choosing a JV partner wisely. Know that your JV partner is committed for the long term and has the ability to make good judgments.

Schedule your time effectively. Why waste hours in discussions with a JV partner that is unproductive?  When you meet and communicate with your partner, make sure you are organized and ready to make recommendations and decisions.

Avoid Wasting Money

Cash is king. You need cash to continue to be liquid and fluid in your business. Know your limits to how much you can contribute to JV, and be honest with a JV partner about your limitations. Before a JV goes live, you and your JV partner should perform marketing research and other studies that provide valuable data about how and where your liquid capital contributions will be spent.

Avoid Losing or Wasting Proprietary Technology

Your JV should share resources in the pursuit of making a profit. However, you must be wise and cautious about sharing secret intellectual property. Sharing a printing press is one thing, but sharing unique software programming that you developed is another. Be willing to use your technology, but you don’t have to share your secrets.

Avoid Losing Credibility

Indeed, one of the risks of a JV is the risk of losing face with your customers or with other business associates. This is where choosing the right JV partner becomes very important again. If your business has a stellar reputation, don’t agree to a JV with a business owner known for cheating or poor customer service.

Joint ventures are inherently geared for success, just like two heads are better than one. You must be willing to share and participate, but take the time to be organized, research, and make wise choices so your JV will have the opportunity to blossom.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

3 Simple Psychological Rules to Help Your Joint Venture Thrive

Many small business owners experience great sales success when they form a joint venture, but some do not. What is the difference between a successful JV and an unsuccessful one? It could be the consumer psychology used to sell JV products and services! Read below to discover some simple tricks to help increase your JV sales.

1. Don’t Give Consumers a Choice

Consumer research has proven that too many choices can deter consumers and actually drop sales. Choices can cause the dreaded “analysis paralysis” in consumers. Rather than providing all things to all customers, a JV that markets a wide variety of similar products may do more harm to their sales because consumers would rather make no choice than make a complicated one.

Too many choices may also cause buyer’s remorse. Why? Consumers will wonder whether they should have made a different choice and possibly regret the buying decision. So why drive your customers away? Don’t give them too many choices. Rather, provide a quality product each and every time that will satisfy customers and give them reason to return or tell others about your JV business.

2. Customers Buy Happiness

Customers will spend more money when they feel good about their purchase. Even if your JV sells a product, the experience that the customer feels during the purchase can make the sale very worthwhile. What does that mean for your JV business? Focus on customer service and atmosphere.

When you greet customers and treat them as friends, they enjoy the experience more than with a sour-faced and bored clerk. Customers always appreciate good customer service, even if they do not acknowledge it in the moment.

If your JV runs out of a brick and mortar location, provide a welcoming place for your customers as well. Hire an interior designer if necessary to create an atmosphere where customers feel comfortable. A fine five-star restaurant is a good example of a place that may create a welcoming dining atmosphere. Consider all the senses, good lighting, creative décor, soft music, and pleasant aromas.

3. Focus Advertising on Your Product

Some general consensuses believe that certain elements in advertising will help sell a product, such as sex or comedy. The belief is that attaching attractive women to a product primarily bought by men will help its recall and sales.

However, researchers at the University College London found that product recall was no better when sexual or comedic elements were used in advertisements on television ads.  Therefore, focus on your JV product and its benefits and problem-solving usefulness in your ads. There is no need to spend more money on clever gimmicks that do not help sell a product.

Your JV can experience more sales if you know how to effectively advertise, display your products, and treat your customers. Try these simple yet effective psychological tricks and see how your sales climb.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

Crush Your Competition with a Joint Venture

Have you experienced frustration trying to capture a small percentage of the market share, but find your efforts thwarted by your competition time and time again? Perhaps you should try a new strategy. Create a strategic alliance in the form of a joint venture with a carefully chosen partner who can boost your momentum and increase your market share.

Joint ventures are a great way for individual businesses to share information, pool resources, and combine marketing efforts to sell products and/or services. With a solid strategy and marketing effort, you can effectively increase your market share in your industry, whether it is local, regional, or even national.

Main Types of JVs

Though the forms and formats of JVs are wide and varied, there are two main types that in which most JV partners engage.

• Marketing JV – A marketing JV is one where the JV partners form agreements to jointly sell, promote, or distribute products or services. With joint promotional efforts, you can effectively reduce your advertising budget since the marketing costs are shared between the partners. This gives you an advantage over the competition to advertise and sell more products.

• Production JV – Another popular form of JV is the alliance where two businesses come together to design and produce a product. By combining technology, production equipment, and intellectual property, the JV could produce a better product more efficiently than the partners could do alone.

Broaden Your Customer Base

How will you beat your competition? To win, you must sell more products or services -which means you need to find more customers. By forming a JV to either cross promote or produce a joint product, you also have access to a valuable database of customer contacts and a wider customer base. If you choose a JV partner wisely, you will consider the customer base that will accompany your choice.

Utilize the contacts from your JV partner to offer special deals to his customers. If you jointly produce a product, combine your mailing lists to engage both sets of previous customers. You may be pleasantly surprised to find that your customer base grows considerably just from exposure of your products to your JV partners typical customer base.

Other JV Benefits

Other benefits of a JV that can help you increase your market share could be any or all of the following:

• No new investment in infrastructure (resources are shared)
• Instant access to new markets
• Risk reduction
• Learn new skills
• Access to new technology
• Economies of scale

Your efforts to maintain and grow your market share don’t need to be wasted. If you have hit a plateau of sales increases, try a new strategy. Form a joint venture and leverage the power of combined resources and ideas. The risks for such an endeavor are generally few, and the benefits far outweigh the risks. Start your journey to capture more market share with a JV today.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

How to Cross-Promote for Joint Venture Success

Let’s say you have not taken the full dive into a full-time joint venture. Is there something you can do to test the waters and find out if a joint venture is right for you? Absolutely! You can form a short-term JV with another partner for a limited time only as a cross-promotional effort.

Cross-Promotion 101

Cross promotion is an activity where you and your JV partner simply offer special deals on the other partner’s products. There are many ways to cross promote and bring more attention from your respective customers to your JV partner’s products.

Cross promotion can take many forms. One popular form for JVs is to simply display and merchandise your JV partner’s products in your store while your partner does the same. Another way might be to offer coupons for special deals on your JV partner’s products.

Another popular cross-promotional merchandising strategy is to package the deal. Both you and your JV partner can package products to sell for a special price, or even offer complementary services that customers of both businesses may need.

Case Study: Cross-Promotion Success

A good example of a successful cross promotion occurred just this last summer in 2009. The Excel beef division at the international food producer Cargill’s in Wichita, KS and food giant Kraft paired up for a temporary joint venture that lasted from July through August 2009. The joint venture was planned to cross promote Cargill’s ground beef products and Kraft’s popular A.1. Steak Sauce.

Cargill’s ground beef packages sold in retail stores throughout the Midwest carried a coupon for $1 off A1 Steak Sauce if purchased simultaneously. The joint venture also created awareness of both products by placing signs and product displays for A1 Steak Sauce near the fresh meat case, with signs placed for Cargill’s beef near the A1 Steak Sauce aisle. This helped create awareness for customers and encouraged shoppers to interact with both products.

Additionally, to help steer customers away from traditional ground beef recipes, Cargill and Kraft promoted and offered recipes for flavorful dishes that used A1 Steak Sauce as the Texas-Style Burger, Bold ‘n’ Saucy Cheeseburger, and the All A1 Burger.

Although it is too early to determine the full financial returns of the joint venture, there is no doubt that the cross-promotional effort was a success. The cross-promotional efforts took place in over 1,900 retail grocery stores, including SuperTarget stores.

The Cargill-Kraft JV is a good example of how you can effectively form a JV for a short-term cross-promotional effort. Remember to utilize coupons, signage, and package merchandising to help make the JV a success. If you and your joint venture partner find that the promotional effort was a stunning success, you may want to renegotiate for a longer term.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

How You Can Improve Your Well-Being with a Joint Venture

When was the last time you made a bad decision? Perhaps it was just this morning when you decided to skip breakfast. Your decision to skip the most important meal of the day was a personal one, which only affected you. However, what if your decision had an impact on your joint venture or your JV partner? If you didn’t fuel up properly and your body and mind did not function at its highest level, could you be on a path to making more bad decisions that affect the success of your JV? It’s possible. That’s why simply becoming a member of a JV can help you make better decisions and improve your well-being.

Responsibility of Human Cooperation

Psychological studies have shown that when individuals act only for themselves, they tend to make decisions based almost solely on emotion. A key factor in a successful JV is cooperation, which requires each partner to focus not only on his own needs and wants, but his partner’s as well. When someone else may be affected by a decision, we as humans tend to act more rationally, rather than seek to maximize our own benefits.

What this says is that your involvement with a JV can help you make better decisions when someone else’s well-being is also at stake. The power of cooperation is the leverage needed to get group members to contribute their highest efforts for the collective benefit of the group.

Improvement of Information Processing Capabilities

As mentioned, when you make decisions that may have an impact on others, you will tend to be more rational. We as humans are emotional creatures. And emotions can sometimes lead to irrational behavior, especially when it comes to competing with others for resources.

However, if you pool resources and share in a common goal with a joint venture partner, you will tend to take in more information and process the information more thoroughly on a non-competitive level. In essence, your shared culture develops a better processing system for mutual benefit.

Better Behavior Makes a Better Person

Cooperation for mutual advantage is evidenced in basic society. We have developed societal regulators who help make the laws that benefit society as a whole and have enforcers who make sure that no one benefits at another’s expense. This is the entire basis for the term “civilization”. We have become better people and improved society by not remaining barbaric or savage in nature.

The same goes for you as an individual. You can improve your personal emotional and cognitive maturity with the decisions you make for the benefit of your JV. Your financial situation can improve with the pooling of resources and cooperation you get with your JV partner. In addition, you will feel more compassion and enter a more rational psychological state when you know that your decisions are benefiting both you and someone else. So go ahead, have that bagel and make better decisions today.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

How to Use Blogging to Market Your Joint Venture

Social networks have become one of the hottest ways to promote and market business – and blogging is still at the top of the list. If you have formed a joint venture and are looking for new ways to attract and retain customers, then you need to get on board the social networking train. Here’s some great ways you can promote your business on the web.

What is a Blog?

In the 1990s, it was hip to have a website. Internet access grew at an astonishing pace, and any business with a website had a leg up on the competition. Now businesses with an edge are those with a blog.

Blog is short for web log. It’s simply a way to write about your JV and publish it on your website easily, quickly, and with great results. Each blog post acts as its own web page. Thus, it is searchable from major search engines. And the more frequently you update your blog with pertinent information, the better chance your blog will show up on a search result.

You and your joint venture partner can easily set up a blog with no money using free popular blogging sites such as Blogger or WordPress. You can also obtain a unique URL website address for your blog for a small fee.

How Your JV Should Blog

So how do you blog? It’s simple. Write a short article that promotes your JV business in some way. Though some blogs have long posts that are more like never-ending political overviews found in The New Yorker Magazine, people who read blogs on the Internet like to get their information in shorter doses. Try to keep your blog posts to about 300 to 400 words, and that will make it much easier for a follower or potential customer to read.

The content of your blog is the most important thing. You want to post articles and short quips that tell a reader about your business. How can they benefit? How does your JV product make their life easier? What’s in it for them? Tell them all the great news and don’t hold back.

You could write short case studies of how a specific customer benefited from your JV product. Include testimonials from customers as well. If potential customers are going to try your product, they like to know that others just like them endorse it.

A blog can also have short features about you and your JV partner, and other employees of the JV if you have them. What are your interests? What makes you enthusiastic about your JV business? Give customers a reason to know you are human and are just like them.

Blogging can be fun and a great way to promote your JV business. And since setting up a blog is so easy, why not try it? Get on the “blogosphere” today and find your niche in promoting your JV business on the Internet.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

Give Your Joint Venture Customers A Reason To Buy

Have you formed a joint venture and experienced less-than-stellar sales compared to your expectations? Usually two or more entrepreneurs or business owners partner up to form a JV with the full intention of making more profit. However, the problem may be in the marketing of your JV product or service. Simply putting a product on the market doesn’t necessarily convince a potential buyer to make a purchase. That’s why you need to use marketing psychology to give your potential customers a reason to choose your product.

Triggering Psychology for Sales

Picture this situation: I recently was at the grocery store standing before an aisle full of different brands of green beans. There must have been 10 or more options, all with different price and packaging. As I stood there scratching my head trying to determine which can would have the best tasting green beans, I found one brand with a simple marketing line: “Picked fresh from local farmers and canned the same day for freshness”.  I remember picking greens beans fresh from my grandma’s garden when I was a kid and enjoying a tasty meal that same evening. I chose that brand because I wanted the same kind of freshness, despite the fact it cost 20% more than the basic generic brand.

This example illustrates why your JV product must differentiate itself from the competition. Consumers are indecisive. Help guide their choice by giving them a reason to buy your JV product. It doesn’t even have to be a proverbial grocery list of reasons. But simply highlighting a few simple benefits can help solidify a consumer’s decision.

Reasons Your Customers Buy

Here is a small list that is by no means complete regarding why your customers buy.

• Price – Some people will always base a decision on price. However, that doesn’t mean your product has to be the cheapest. You could promote that your product costs less than the leading competitor. Or you could charge a premium, but give a good reason why your JV product is worth it.

• Quality – Consumers like quality. Be sure that your product is manufactured or produced using quality and durable materials. Or if you offer a service, make it the best quality service and be sure to explain why it’s better than the other company.

• Innovation – Something new always attracts customers. Highlight how your JV product is innovative and can solve their problems better than standard products seen on the market today.

• Warranty/Guaranty – People also like to know that you will stand behind what you sell. Offering a warranty on a product or guarantying satisfaction can provide them with the impetus needed to buy your product.

Make sure your JV product or service stands out from the crowd. If you want to see your profits expand, then take the time to provide the reasons why customers should buy your product.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

3 New Ways to Find a Great JV Partner

Still haven’t formed winning joint ventures because you can’t find the right partner? JVs are a great way to increase business and make more money, but you need to have the right partner to make it succeed. If you’re still looking for the perfect JV partner, here are some ways you can focus your search and get started on a JV right away.

1. Subscribe to e-Newsletters

Smart people like to share their intelligence. That’s why you will find literally thousands of entrepreneurs on the Internet sharing their experience and advice. Many of these enterprising individuals have created a website that helps them spread the word about their moneymaking formula, marketing techniques, or their work.

Perform Google searches for popular sites, and look for links to recommended sites that offer the type of services or products you want in a JV. When you find one you like, sign up for their RSS feed if they have a blog, and subscribe to their email newsletter if offered. Usually subscribing is free, so what have you have to lose?

Get to know potential JV partners from their e-newsletters. When you feel you have found a perfect match, approach them with a proposal.

2. Read Trade Magazines

Trade magazines in your industry are also a good way to find a great JV partner. Read them all and look for articles highlighting or interviewing an entrepreneur for their innovation. These are the types of people you want on your side. You may have to conduct some additional research to find contact information, but use clues in the article to narrow a city and look for website information.

You might also look for entrepreneurs who have contributed an article with some fabulous insight to the industry. Usually an author gets a brief bio at the end of an article where you might find an email address or website. If you find a good prospect in a trade magazine, don’t let him or her pass you by!

3. Use a Matching Service

The Internet has a place for everyone. There are websites you can visit where you can get paired up with a potential JV partner, much like a dating service. Usually these websites charge a fee for their service, but you will find that there are lots of potential matches. You may choose to post a proposal for all members to read and let them contact you, or you could browse others’ posted proposals and find one that matches your JV interests.

These sites can be hit and miss. It may take a few months to find a good partner, but you need to calculate whether that subscription is worth the cost of finding one.

Your perfect JV partner is out there. Try using these options to make a search, and get creative with other ways you can find a good JV partner. With the right effort and focus, your JV business will be running full speed in no time.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

How To Add More Value To Your JV With Intellectual Property

Necessity is the mother of invention. However, invention can be just good business too, especially when two great entrepreneurial minds come together to form a joint venture and develop an innovative new product. If your JV is in business with something new, innovative, and that excites consumers, make sure you make the most of it.

Joint Venture and Innovation: A Perfect Match

A JV joins the minds and resources of two individual businesses or business owners and creates a third business with a new product. Many times, a JV team will discover that their initial enthusiasm for the venture has created something even bigger than their imaginations first suspected. When that happens, and innovation and creativity reign, a truly remarkable thing can happen in the intellectual property world.

Let’s say you are an expert software programmer and an enterprising individual approaches you to form a joint venture using your programming skills and his database designing expertise. The original idea was to develop a database system that would make invoicing, billing, and purchase easier and cross-referenced for coding and authorization for distribution businesses. The final product was such a success that it has found useful application in almost any business that does shipping of manufactured items.

How to Protect Your Innovation

What you and your JV partner created was highly valuable intellectual property. Your patent for the software and licensing potential can shoot your joint venture equity through the roof. If you are working with a JV partner and have developed intellectual property, here are some things you should do to protect it.

• Patents – New inventions, such as the software program, should be patented for your protection. With a sole patent on the product, you can license it for sale or for others to manufacture and sell. Residual income can amount to millions of dollars with the right patent and licensing strategy.

• Trademarks – A trademark can be a highly valuable identification. A product or even your JV business name can be trademarked if it becomes highly reputable and recognizable. A word, phrase, logo, or a combination of these can become a trademark.

• Copyright – A copyright is any creative artistic or literary endeavor that has manifested into a concrete, tangible item. Books, articles, paintings, graphic designs, sculptures, music compositions – all these can be copyrighted and licensed to others for publication, performance, or display. If you and your JV partner create copyrighted material, be sure to carefully manage the licensing and use of these items to increase the maximum profit.

Intellectual property is sometimes overlooked. Take time to make an inventory of the intellectual property developed by you and your joint venture partner. The inventory may surprise you. It is also recommended to hire an attorney who specializes in intellectual property to help not only protect these assets, but to help license them to the maximum benefit of your JV business.

Christian Fea is CEO of Synertegic, Inc. A Joint Venture Marketing firm. He exemplifies how to profit from Joint Venture relationships by creating profit centers with minimal risk and maximum profitability.

To discover more Joint Venture Marketing Strategies join his free Joint Venture Marketing Wealth Report.

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