Strategic Sales Alliances:
Delights, Distractions or Disasters: Nine Ways to Tell
by Andy Birol
Whenever cash, sales coverage, access to buyers or closing skills are scarce,
a sales partnership with another firm is often an answer for finding customers.
Whether it is two individual service providers selling complimentary expertise
to the same target markets or two large companies co-marketing and co-distributing
their products, the records of accomplishment of alliances are a mixed bag.
To many, even those directly involved, alliances seem to defy logic as to
when and how they work. And, in an uncertain economy, leveraging scarce resources
can take on an air of desperation. Sometimes the entire future of a company
can ride on a "shotgun marriage".
No matter what the economic conditions, sales alliances appear to cost little
and offer much. But do they really help or just hurt your business? Here are
nine ways to assure they work for your company.
- Do not create the alliance before you have a profitable opportunity.
Too many grand plans are written with no pot of gold in sight. For every
hour spent constructing prospective sales plans or profit sharing arrangements,
ensure you have active and qualified prospects with time, money, need and
authority waiting to buy from you and your partner.
- If you are the rainmaker, make the others pay. Too often, those
most interested in forming alliances are looking for someone else to sell
what they cannot. If you are approached for your rainmaking skills, translate
your position of power into a high percentage of the spoils and an ability
to call the shots.
- If you deliver the goods for a rainmaker, ensure you are working
with a rainmaker. Your moneymaking partner had better have a track record
and an incentive for closing all of the business you need to deliver. Agree
with your partner on service, quality and delivery standards both the rainmaker
and your mutual clients demand. Assure the price and profit is in there
to make it work over the long term.
- Never compromise your objectivity or expertise. Sometimes one
partner in the alliance sees a quick profit in selling your hard earned
value or reputation on the quick. Do not sell out in the short term when
building your brand and your market position will come naturally over the
- Keep the family jewels. Whatever your best and highest use, guard
it with your business life. Be it your ability to produce, deliver or close
sales; do not teach your partner what they need to make your participation
- Do not count on your partner for all your success. It is rare
that any alliance will completely replace your need to deliver or sell.
Do not grow complacent or lazy at what your partner does better in spite
of how well it may be going. Few alliances last forever. If yours collapses,
can you carry on alone?
- Do not try to hit a home run on the first date. Alliances, just
like personal relationships, grow over time and improve with age. Do not
expect miracles early on but rather look for continually improving rewards
from your cooperation. The best relationships transcend the products, services,
customers and opportunities on which they were started.
- Cut bait quickly if agreed upon progress is not delivered upon.
If you, your partner, your market place or your deliverables are not performing
to your expectations, fix the problem or forget it. Proactively solve the
problem; passive responses will not lead to a win-win solution.
- Build your brand or private label. Rarely does it make sense
to co-brand and co-market both organizations equally. Unless you are Disney
or McDonalds, one brand will have more traction in a given market place.
Lead with one or choose one. If neither makes a difference, private label
your alliance under a name that will.
Too often, forming a strategic sales alliance is an excuse for lack of
focus, poor selling skills or disconnection from the marketplace. If you see
that in a potential partner, either fill this void or run away. If you see
this in your business, fix the problem.
Andy Birol is a Cleveland-based business growth consultant, owner of Birol
Growth Consulting and author of "Focus. Accomplish. Grow… The Business
Owner's Guide to Growth." He holds an MBA from the Kellogg School of Management
at Northwestern University and has been published in The Wall Street Journal,
New York Times, Entrepreneur Magazine, Fortune Small Business
and many more. In 2002, his firm won the Weatherhead 100 Award as Northeast
Ohio's fastest growing single-employee business. A guest expert on CNN's Dollar
Signs, NPR, and NBC, Andy comments on national and local issues facing business
owners who want to grow their businesses. Andy can be reached by visiting
his website at www.andybirol.com
or at firstname.lastname@example.org
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