| Business Combinations |
Mergers, joint ventures, consolidations, acquisitions, strategic alliances, associations, and
other combinations of business entities can also be employed to raise new funds for your
business. The business climate of the '90s has encouraged the use of joint ventures and
alliances between businesses as a means of reducing costs and ownership dilution. Most
of these arrangements are contractual, but no standard contract terms exist for all
industries. The advantages of these joint ventures and alliances is that your business can
finance certain services or production functions by sharing expertise, assets, expenses,
and risk without necessarily incurring cash debt or trading equity.
For small businesses, strategic alliances often consist of simple "bartering" with
customers, suppliers, and even competitors. For example, if you own a manufacturing
business, you might be able to get a better price for component parts if you propose
using a label on your final product that includes the supplier's trademark. Alliances for
research and development efforts are also quite common as a means of minimizing these
long-term costs. In certain high-tech industries, the cooperation of other businesses is
essential, not only from the standpoint of financing, but also for marketing, licensing, and
distribution.
When considering strategic partners, most small businesses will benefit from partners that
add value, not just money. For instance, a business association with a well-recognized
industry name can generate immediate credibility and also assist in advertising and
marketing for your company. Your networking ability plays a major role in locating and
investigating strategic partnering opportunities.
other combinations of business entities can also be employed to raise new funds for your
business. The business climate of the '90s has encouraged the use of joint ventures and
alliances between businesses as a means of reducing costs and ownership dilution. Most
of these arrangements are contractual, but no standard contract terms exist for all
industries. The advantages of these joint ventures and alliances is that your business can
finance certain services or production functions by sharing expertise, assets, expenses,
and risk without necessarily incurring cash debt or trading equity.
For small businesses, strategic alliances often consist of simple "bartering" with
customers, suppliers, and even competitors. For example, if you own a manufacturing
business, you might be able to get a better price for component parts if you propose
using a label on your final product that includes the supplier's trademark. Alliances for
research and development efforts are also quite common as a means of minimizing these
long-term costs. In certain high-tech industries, the cooperation of other businesses is
essential, not only from the standpoint of financing, but also for marketing, licensing, and
distribution.
When considering strategic partners, most small businesses will benefit from partners that
add value, not just money. For instance, a business association with a well-recognized
industry name can generate immediate credibility and also assist in advertising and
marketing for your company. Your networking ability plays a major role in locating and
investigating strategic partnering opportunities.
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| FDG Global Services |
| World Class Consultancy |
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