By: Adhir Uzcátegui*
How do I form a strategic business alliance in Security to accelerate the growth of my company?
Recently we have been conducting several individual interviews with entrepreneurs in other areas outside the security industry throughout Latin America, to find out what are the most frequently used business strategies and what are the reason for their success. The idea is to apply them to our security systems distribution company. "Strategic alliances" was one of the main ones.
To consolidate a strategic alliance, align your security company with a complementary company. This concept of partnering can help maintain a small staff and, at the same time, generate important rewards, and it is already giving us excellent results and has motivated us to continue in the search throughout the Latin American territory.
Types of alliances
Business alliances can take different forms. In a formal business alliance, a contract is signed that describes in detail the legal implications, accounting issues, and management of a project. Complex alliances can involve a capital investment, and even a merger or acquisition.
However, many alliances are made without a formal contract, are based on verbal agreements, and function as business relationships. An example is the case of an installer who sends his alarm installations to a monitoring center and the dividends are shared. Sometimes a referral commission is part of the informal alliance.
Between the two extremes of alliances (formal and informal), there are countless written agreements that two or more companies can be a party to. Often the written agreement divides the profits of a joint venture.
The advantage of these alliances is that security companies in Latin America seek business with other major companies, preferably with global reach, and the partner companies can collectively achieve what none could do individually. As with any business strategy, there are certain parameters to keep in mind when analyzing the possibilities of making an alliance.
The two sides should benefit from a strategic alliance. The alliance must have a specific strategic purpose in which both parties benefit equally. Even large companies can enter into inefficient alliances for confusing strategic purposes and consequently suffer setbacks.
In advantageous alliances, the two companies take advantage of the products and services that each of them offers in the same target market. If your security company has consistently worked on projects with another company, this may be the time to grow the partnership to a formal level. For example, do you need to locate local distribution partners in other countries such as the United States? Would your customers benefit from an after-implementation advisory service that your company does not currently offer? Can you seamlessly deliver additional products or services to your customers through a strategic alliance?
Sometimes, sharing the costs of marketing and advertising and spreading the profits of a business venture can be worth it. However, it is imperative that the expectations of partner companies are aligned and clearly expressed.
Agreement on specific goals and objectives
Generally speaking, an alliance can aim from expanding into new markets to realizing new opportunity discoveries, developing or commercializing new products.
Your company will gain knowledge and experience through a strategic alliance, and learn new ways to market your products and services and improve customer service. A well-selected strategic alliance can open up the possibility for your security company to have a greater number of sales professionals and to expand the customer base. In today's market, you can become a multi-million dollar security company if you build the right strategic alliances. So think of the forest and not the tree. If you want additional information, you can contact me that I will gladly send them to you.
Happy sales!
*If you wish to contact the author of this article you can write to the email: [email protected]
