subject: Joint Ventures: All Profit, No Loss [print this page] There are no shortcuts in business, but there ARE ways to use the power of leverage in profitable ways. You are about to find out how to earn much more money without adding new equipment, services, staff or hours of labor to your life through organizing joint ventures (JVs).
No matter what kind of business you run, what products you sell or services you offer, you can serve both your customers and your bank account better by organizing joint ventures, or JVs. All you need is a sincere desire to serve your customers even better than you already do plus an eye for increasing leverage.
A JV happens when two or more businesses create a deal that is mutually beneficial to both companies and to all customers they serve, creating a win-win-win scenario. While it may sound like "pie in the sky," it is an extremely productive way to raise your bottom line.
This is a game of matching. You are filling a need with an asset or finding an asset that fulfills one of your needs.
Start by asking yourself these questions:
- What product, service or system do I have that other businesses would benefit from having or using?
- What systems, services or products do I need that would better serve my clients/customers without any extra work on my part?
Let me give you a real-life example so you can understand.
One entrepreneur I know has a system for improving website traffic in a mostly automated way. That's an asset. Naturally, he is selling this monthly service to people on his own. Now he wants to lengthen his reach.
As he contemplates what type of customer is best suited to use his service, he writes:
- Bloggers
- Network marketers
- Internet entrepreneurs
- Bricks and mortar businesses that have a presence online (at least a basic website)
His needs include: - Customers to use his monthly service - Affiliates (or distributors) who will act as a sales force to sell his service to their customers - Businesses that will integrate his system into their own
Organizing a joint venture also improves his leverage and extends his reach because he will gain customers and affiliates as part of the deal. He will create a win-win-win by finding someone who will integrate his service into their business.
Let's say he meets someone who has an online education program that teaches people to start and run an internet-based business. Here is what he will do to determine whether there is a good "fit" for a joint venture. (This is what YOU will do for your own business)
Research Phase
Before diving into a relationship, he has to find out who would be the best JV partner.
1. He researches the company and business owner to make sure there is currently enough traffic to make it worth his while. He can determine this by looking at their website rankings on Alexa.com and Quantcast.com. If this person only has a few students, there is no profit in it for him. However, if the school is already thriving, the potential for growth is huge.
He studies the other entrepreneur, looking for several things. First, he wants to be sure she runs her business in a way that he perceives as being in alignment philosophically.
Both potential partners get to know each other. They have to explore whether their proposal is a "match made in heaven." They want to boost the results that come as a result of their collaboration.
Organization Phase
After meeting via phone and getting familiar with each others' program, they decide to move forward. Together, they forge an agreement that looks like this:
1. All students of the online university get the traffic service free for three months.
Then, the students get a special price from then forward. It might be called an "Inner Circle" rate.
3. They don't get it on the day they enroll but rather after they already have their website and blog established and after they have gained an understanding of how to drive traffic.
Implementing the Venture
1. Our traffic guy sets up a special webpage for students and a special portal into his service.
The training program owner has the perfect tool for her students. She incorporates it into the way she teaches. It makes her life easier and brings better results for those taking her training when they have the right tools to grow their business.
Where's the Win-Win-Win?
For the owner of the web traffic membership site
Maybe you are wondering how giving away three free months of service to a whole bunch of people serves our traffic guy. Imagine this: Without any advertising, he gains a few hundred brand new customers a month. They use it free for 3 months, and because this is such a perfect match, they are going to continue to buy the service.
He also gains an army of salespeople out of the deal, because many of the students in the school will also become affiliates. THey will earn a commission for selling his program to their customers or clients.
So if our school generates 500 new students per month, he gains 6,000 new customers annually plus maybe 3,000 more who are current advanced students, with no effort other than making a few phone calls and a modified webpage or two. Even though some will not retain the service, most will.
For the university students
They have the perfect traffic generation tool and they have leaerned how to use it for best results since they have just been trained in generating traffic. They will use this tool from now forward because it so perfectly meets their needs. Now, they're hooked and most of them will become long-term members using the service.
Additionally, a significant number of the students will gain a source of income by promoting the traffic students for their customers or clients. They become a sales force and are glad to earn a commission.
For the training program owner
You already know that a good joint venture must be a win for all parties involved. So far, you've seen how the traffic guy and the students win, but what about the online university owner?
The owner of the education program also wins in a big way, because she is able to provide something every student needs, at no cost to her and at no cost to them, for a whole three months. This also means she has a highly valuable bonus added to her program. Say the traffic system costs $97 per month. They save $297 the first quarter. She is setting them up for success by offering such a useful tool for them.
Everybody wins when you put the deal together in the right way, and that's exactly how it should be.
This is an extremely profitable game of matching. All it takes is a little research, an open mind, and a willingness to hook up the right needs and assets. So start planning your own joint ventures right away.
