What is The Real Meaning of Joint Ventures

Alexander Swan By Alexander Swan, 13th Apr 2013 | Follow this author | RSS Feed | Short URL http://nut.bz/v0rak_7b/
Posted in Wikinut>Business>Investment

Joint ventures generally are business partnerships established between two or more parties (individuals, business groups, companies, corporations) for the purposes of expanding the business and achieving merits by joining forces and working as a team.

The Real Meaning of Joint Ventures

Joint ventures generally are business partnerships established between two or more parties (individuals, business groups, companies, corporations) for the purposes of expanding the business and achieving merits by joining forces and working as a team. The parties involved in joint venture agreements complement each other, leverage each other assets, compensate each other weaknesses, and at times equally share risks.

Less than 5% of businesses actually use joint ventures effectively and most do not even use it at all. In order to get the most out of joint ventures correctly, multiple factors such as choosing who to partner with, approaching potential partners correctly, negotiating a win-win deal for all parties involved, and having a well-coordinated execution need to be taken into consideration.

There are several types of joint ventures. Big companies may join forces to become even more powerful and thus dominate the market, while small companies may team up to build a stronger presence in their market niche in order to fend off bigger, resource-rich companies. Joint Ventures can also be used to gain access into foreign markets. Foreign companies often form joint ventures with indigenous companies that are already present on the market, but lack capital or financing to truly take advantage of the market potential. Foreign companies can bring money, new technologies and competitive strategies into a joint venture deal, while benefiting from the relationships and the brand of the domestic company.

These complementary partnerships benefit all the businesses involved if set up correctly with the right partner. Here is a powerful but simple example of a JV that many businesses can take advantage of to grow their small business fast. It is a highly efficient method of increasing business profits by teaming up with another partner whose business is non-competitive and offers a highly valuable asset, a highly responsive client list that would be interested in your products or services.

By tapping into this hidden goldmine, small businesses can save thousands of dollars in marketing expense to reach their target clientele while achieving the goal of boosting the bottom line. The business offering the vehicle in which to reach these clientele, the client list, benefits from offering complementary products and services that it does not sell and makes a cut of the sales generated from marketing to this list.

Tags

Business, Business Opportunities, Business Study, Joint Venture, Joint Venture Partnership, Joint Venture Request, Online Business, Online Money Generation

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author avatar Alexander Swan
I'm an experienced blogger and an individual professional to encourage and inspire people with meaningful action and make a positive changes in their life.

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