Are you selling a business and using your strategic alliances, or business partnerships, to not solely drive new sales and value, however additionally to test drive potential consumers?

Did you know that over twenty five percent of the earnings of the 2,000 highest ranked US and European companies comes from strategic alliances? 

Selling a business aside, the payback on strategic alliances warrants investment.  The investment banking firm of Houlihan, Lokey, Howard & Zukin reports that alliances have consistently produced average returns on investment that are nearly fifty percent more than the average overall returns on investment in corporate America.

It is not only a know-how method to develop new business, however also to focus on and test drive probable buyers.  With a solid and strategic partnership in place, you will  be able to determine if a next step could be selling a business to them.  What questions should you raise that places you in the best place potential:  with additional business, and more business buyers?

Developing Your Partnership Strategy:  Three Key Queries to Approach

1.Determine your business readiness.  Determine if this tactic is true for your company.  Key questions:

• Will you give a distinct advantage to an alliance partner?  Could that partner be a possible  buyer?
• Are you willing to refer your customers to someone else?
• Can you be courteous when someone else’s customers are stated to you.
• Are you prepared to have a commitment of resources and a way of urgency to drive your own and your partners’ alliance goals? 
• How much effort and resources can you commit?
• Do you have experience in strategic alliances and, if not, how would you get it?

2.Align along with your business strategy.  Via your company’s overall strategy and objectives, as well as your exit strategy, determine what partnerships will provide value.   Key queries: 

• How can a partnership strategy play a role to your business strategy, and your objective of selling a business?  How may an alliance best serve your shoppers, and put you in a position to sell your company to the best buyer?
• What new value can be created with a partner?  What are your targets and opportunities?  Where will partnerships contribute to growing your business, improving the business valuation, and position it best for sale?
• What is the alliance strategy of your competition?  What can you learn from them?

3.Produce Partner Analysis Criteria.  Prioritize and weight the following key questions:

• Worth creation:  Does this partnership truly add additional worth?  Is one + one greater than 2?  Is this alliance client centered?
• Cultural match:  Does this potential partner’s management vogue, values, ethics and behavior build your assurance and your comfort?
• Corporate strategy:  Does their overall strategy and objectives work with yours?  Is this partnership of strategic importance to them?  How can every partner advance the strategy of the opposite?
• Product, service and client portfolio review:  How will what they do and who they do it with map against yours?  What are the synergies and the added worth?  How does this partner expand your reach, either in offerings, market or geography?  Where is that the overlap, and how can that be managed?
• Business partner program support:  If the potential company features a partnership infrastructure, what support will be offered?  Some supply education, software licenses, facilities, marketing campaign materials, and different benefits.  What can you supply?
• Business health: What due diligence should be done?  Are they a viable and steady organization?  What is their capacity to initiate, manage and build this partnership successful?  Are they a quality organization?  Will your partnership strategy create an unhealthy dependence for either company?
• Executive sponsorship:  Is the probable partner committed at the leadership level to make this successful?
• Learning chance:  What will you have got the opportunity to learn through this partnership?

Sales targeted alliances are really a way to accelerate business growth.  They do require strategic view up front to find the proper partner, and execution skills and commitment to make it work, especially when among one of the goals is to test drive a potential buyer.  If you are brooding about selling an organization, contemplate how strategic alliances may work into your exit strategy. 

I invite you to use these ideas throughout your journey to sell a business.

Marian Cook is a highly sought after business transition expert and speaker with over 25 years experience helping business owners design their best-life exit strategy, and improve their business performance and valuation.  She is the co-author of “Selling Your Business For More:  Maximizing Returns For You, Your Family and Your Business” (published by Macmillan).  If you are ready to sell a business and jump-start your business sale process, connect with Marian via her free tips, articles, checklists and blog at Business Transition Experts.

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