What is a Joint Venture?
Joint ventures can take on many looks, but the basic gist is that two or more companies come together to pool their talents, resources and customer lists for the benefit of all. The joint venture allows you to share advertising dollars for a more effective campaign and gives you the opportunity to ride the coattails of a bigger, more established company in order to boost your reputation and build your customer base.
Most joint ventures take place between related companies that share a similar target market, but do not compete directly in the goods and services they offer.
Benefits of a Joint Venture
There are many reasons to consider jumping into a joint venture ...view middle of the document...
* access to new markets and distribution networks
* increased capacity
* sharing of risks and costs with a partner
* access to greater resources, including specialized staff, technology and finance
With so many excellent advantages involved in joint ventures, it is a wonder why more companies are not hopping on the bandwagon. In fact, you can find many joint ventures that already boast a track record of success, making these business models and attractive option indeed. However, JV marketing may not be the right approach for everyone.
Drawbacks of a Joint Venture
Before you jump into your first joint venture, it is important to assess the risks associated with such a business agreement. These risks may include:
* Unclear objectives for the partnership, which may result in unmet expectations and hard feelings on both sides
* Different objectives may result in the JV with the partners actually working against one another, using valuable resources and energy without bringing about the desired outcome
* Partners are...