Achieving success through collaboration
When it comes to your business, it is often said that "two heads are better than one". This may be true, but success in collaboration depends on how well you work with a partner, and what complementary talents each of you brings to the table.
A partnership is an arrangement where you and at least one other person become co-owners of a business. Forming a partnership can ease some of the liability burden you would bear as a sole proprietor. In addition, you and your partner(s) file taxes as individuals, not as a corporate entity; the flip side of this is that you are personally liable for any business debts and obligations.
Another kind of partnership is a joint venture. This is where your business teams up with one or more businesses, either for a specific purpose or for a limited period of time. For example, your technology business might form a joint venture with a similar business in order to combine your resources for research and development of a product that will benefit both of you.
By joining forces in a joint venture, you can:
- Extend your marketing reach
- Access needed information and resources
- Reach new, previously inaccessible markets
- Build credibility with a particular target audience
When starting a joint venture, you may want to set goals by deciding what you need to accomplish, and use your networks to look for others who share your goals but bring different ideas or resources to the table.
Canada has no specific laws governing joint ventures so it is important to have a contract with the other party. This way, your interests are protected. In a contract, you can outline:
- The terms of collaboration based on the roles of those involved
- The management structure of the project
- How profits will be shared
Properly planned and executed collaboration can increase your chances of success and allow you to achieve more than you could have on your own.