Building Significant Business Partner Relationships
It is critical for your business to align itself with competent and ethical business partners. Mediocre business partners can have a devastating impact on your firm. Every business partner, no matter the size or how often they are utilized, must be transparent, ethical, competent and communicative.
Choosing a Business Partner
When considering a new business partner, it is always wise to get feedback from your current employees. Asking other clients about the business partner is a good idea as well; however, make sure that you do not only inquire to clients the business partner offers as referrals. Be as specific and direct as possible when interviewing a business partner. Make sure they are aware of your weaknesses and strengths and that you are aware of theirs. For instance, you may not want to work with a business partner who has not updated their technology in ten years. You are seeking a specific business partner for a current need. Think how the relationship will evolve in five or ten years or more. Therefore, you must make sure you are thinking strategically, not tactically.
If the partnership promises to be a significant one, such as a document management engagement, it is prudent to request two years of financials. Specifically, make sure a business partner is not substantially in debt or losing money. You want to ensure that they are in a position to partner with you for the long-term. You don’t want to be left scrambling to find a replacement if a significant business partner finds it necessary to file bankruptcy.
Make sure that the relationship is beneficial for both you and your business partners. If the relationship is not beneficial to the business partner, you can expect inferior service from them, and you may be forced to choose another provider.
Maintaining a Good Relationship
Once a business partner is chosen, it is not “set it and forget it.” It may make sense to set up a Google Alert so you are notified if anything appears on the internet (good and bad) with respect to your business partners.
Depending on the services a business partner provides, it is important to schedule meetings with the business partner on a routine basis. It may be something as simple as a phone call asking how things are going or as in depth as an in-person or virtual meeting.
It is critical to communicate your priorities to your business partners. Let them know what you need and when. If a service is thought to be substandard, it is better to discuss possible solutions rationally rather than to terminate the relationship and have to start over with a new business partner. The best relationships occur because all parties are transparent and forthcoming.
On the firm’s behalf, make it a point to reach out to every business partner routinely as well. Again, it can be a phone call or email. For the more significant partnerships, perhaps it would be more appropriate to meet and discuss current events. It cannot be stressed enough how important it is to be as transparent as possible. Understand how each business partner thrives. When possible, recommend your business partners to colleagues to help them grow their business. By helping them to succeed, you become more valuable to them as a client, and they become a more stable business partner. So, it’s important to learn as much as you can about one another to make the relationship for both parties more productive and rewarding.
Depending on the service provided, it may make sense to restrict the value of gifts provided by your business partners to your employees. An employee should report any annual gift over $50 to management. Many times, a business partner will provide sports tickets, gift cards or other incentives for employees to use their services. Recognize that these gifts are a cost of doing business and ultimately, the client is paying for them.
Know When to End a Relationship
If a business partner’s focus has changed, it may signal that it is time for you to make a change as well. For instance, if a business partner no longer is attracting clients that are in your industry or is no longer investing in long-term platforms, it may be time to begin looking for a new provider. This is critical for technology, document management, cloud providers, and accounting providers. If they are not staying current, make a change before it has an impact on your business.
Every relationship will eventually end, whether within one year or after thirty years. So keep that expectation in mind and take the time to discuss strategic options ahead of time. It is always important to review any contract regarding termination. Many contracts include termination fees or minimum time frame so make sure you understand these terms prior to entering into any relationship.