In the past, joint ventures were complimentary to businesses that leveraged off of all kinds of other businesses. However, the Great Recession destroyed confidence and potential in markets to set up endorsements. Meaningfully speaking, contingency plans failed to exist. Uncertainty about the future put everybody in survival mode.
On the surface, joint ventures do not sound very complicated. Most people understand the idea of working with others as opposed to working strictly by yourself. However, within the realm of joint ventures, there is a wide variety of types and arrangements that need to be understood before one can really take advantage of all the opportunities.
First, is to become aware of the different types of joint ventures that are available, the pitfalls to avoid and how to look at joint ventures in the right perspective. The goal here is that you have a broad understanding of all the different types of joint ventures and that you will be able to spot opportunities better, and find the money where none would be apparent to the average person.
For example, spotting opportunities for joint ventures and being able to negotiate successful joint ventures has literally made many people a ton of money, and has allowed them to maintain their primary goal of operating a business and being in control of their life. These entrepreneurs look at the world from a completely different viewpoint than most.
Where most people may see something, and even think about what they see, in most cases they do not observe the money making potential that others see looking at the same things. A joint venture with another potential business can help them market any product or service successfully, and therefore, help others to bring their product or service to the market, thus profiting both parties.
The thing to do is start looking at the world through the eyes of the marketing expert and opportunities will pop up in front of you that you never would have spotted in the past.
It is inevitable that other people will become involved, and knowing your options allows you to make educated decisions when working with others. In fact, the more you work with others and the more you get yourself out there, people will approach you to do joint ventures.
And as with everything in life, some deals will work better than others. Some deals will be mediocre and some deals will be a total pain to cope with. Knowing how to understand and maximize the success of joint ventures will minimize potential problems.
It would be foolish to think that 100 percent of your joint venture activity will work perfectly, just as it would be foolish to think anything will work 100 percent of the time.
There are two main types of Joint Ventures:
1. Where you market somebody else’s product or service.
2. Where somebody else helps market your product or service.
In general, these two categories cover just about all types of joint ventures you may find yourself involved in. In most cases, somebody will have something they want you to help sell or you will have something that you want to have somebody else help sell. Of course, the better way to go about doing things is to not create a product or develop your service until there is a known demand.
While sometimes things get people aggravated, the reality is that often times you can save yourself a lot of stress and wasted time by doing the marketing first. To keep the momentum, have your product or service ready to go, and then produce the necessary quantities once you see that people want to buy it.
Let’s say you have already created your product or service and you think you need money to get things going. Getting involved in a joint venture when you have created a product or service solely for the money is not the best reason to get involved. For anyone, it is realistic to get a very successful business off the ground with pocket change.
While this may take quite a bit longer than someone handing you thousands of dollars to market with, you will be much better off in most cases going slower and staying away from investors. If, on the other hand, the other party can bring you customers, or some form of marketing that you do not understand or have not been exposed to, then it might not be a bad idea to get involved in a joint venture. Doing it for money is almost always a mistake.
Most businesses with a product that you will be in contact with will be thinking about traditional lines of attempting to get their product or service sold to somebody. Realistically, they will go to retailers, distributors, catalog companies, advertising agencies, public relations firms, and publishers.
They will mostly feel that they have got the absolute best, number one, unbeatable, super product or service ever invented in their particular category. You will be reminded when everything they are telling you is highly confidential. In fact, they are sitting on the next big thing. The only problem they have is they cannot find anybody to buy their product or service.
Most people who have created a product or developed a service become so emotionally involved that they lose touch with reality. In many cases, their approach will be intimidating, saying that you are lucky to be able to get in on their great deal. It is understandable that someone who has spent countless hours and donated much of their life to a project to feel that they are bringing the valuable asset to the table.
However, at some point in reality, this has to control the situation. Reality, meaning that without customers, all their sweat, labor and effort is totally worthless. If you present yourself properly to a person who can get customers, you are bringing the only asset to the table that makes any difference.
Whenever you enter into negotiations with someone to work on marketing their product or service, do not let them convince you into thinking that they are the ones bringing the valuable commodity into the deal. In fact, sometimes you may have to literally remind them of the fact that this valuable asset has cost them thousands of dollars with little or no sales to show for it.
In general, if this part of the deal is not overcome immediately, you will want to walk away from this person and wait until something else comes along. Most product or service owners will start out this way and some will relinquish their ego in favor of making some real money. If they cannot get over this right from the beginning and you do agree to work with them, they will only get worse as time goes by and the deal will fall apart, wasting your time and energy.
You are much better off screening these people up front and making sure they understand that customers are probably unreachable, which are the only asset that matters. This piece of advice can literally save you from situations that you will come to regret very quickly. On the other hand, sometimes you will run into a very humbled product or service owner who realizes that without the marketing, they own a worthless asset and will therefore be very cooperative, excited, and easy to work with.
Those are usually the best people to start with because they typically get easier as time goes by. They are normally so happy to finally have somebody buying their product or service that they will be very grateful and gracious towards you.
In addition, one of the things that you have to be able to do with joint ventures is to have the attitude that you are willing to walk away from any deal no matter how good it looks. If some person has the superiority attitude because they have developed the product or service, and you chose to walk away only to find out they were able to later sell the product or service to then become millionaires, you should not even blink an eye and never feel bad.
No amount of money is worth being involved with people that you cannot get along with. Think about this very hard before you approach someone or you get approached by someone else with a joint venture proposal.
The balances in the scale of entrepreneurism are heavily weighed towards the entrepreneurs who have products or services and no customers. For every person who is successful in marketing a product or service, there are literally hundreds who have products or services that are just as good, if not better, that do not have customers.
If you start seeking these people out you will find them very quickly. If you are not well capitalized right now, think about everything as if you were and you will be shortly. If you take anything that comes along because you need the money, you will be sorry every time.