Finding a local partner can be essential to doing business in foreign markets. But how should you go about recruiting the right partner?
We’ll explore some avenues that could help you connect with the right partner to support a successful expansion into new markets.
Networking is an important part of doing business and developing your contacts and market understanding. Whilst you might not be able to locate a partner directly via networking, you stand a good chance of finding them indirectly if you can leverage your immediate network to help you with the hunt.
It’s important to be clear what you are looking for. You’ll need some credibility and charm to persuade the right people to help you get what you want. Generally people are happy to help if your present yourself credibly and generate excitement in your ideas.
The key with networking is to develop your personal and business pitch so that you can easily explain what position you are in and what you need. Remember that networking is a reciprocal thing though, so make sure you’re giving as much as you receive from your networks.
If you plan to target networks in your chosen market, perhaps by visiting local trade events, make sure that you beef up on local culture to smooth over any etiquette issues.
People will be more likely to open up and help you if you approach them in the right manner. For example, many Asian countries have etiquette specific to the giving and receiving of business cards. In Korean business cards tend to be bilingual and in many Asian markets there are specific ways to receive and handle a person’s card politely. Make sure you know the right way to behave in business situations.
As a busy professional you won’t have much time to waste, so choose the networks you want to access carefully. If you’re attending events, learn how to work a room so that you maximize your contact opportunities. Whilst many events are free it can be worthwhile experimenting with paid events if they are likely to get you the right level of access with influencers in your industry.
Don’t neglect your existing partnerships; business contacts such as your investors and legal advisors may be able to access their own networks on your behalf. It’s important to articulate what you need and what you have to offer in order to get what you want via networking. Make sure everyone in your circle knows what you are looking for as the contacts you need may already be within your reach.
Get help to find new partners
In the US, there are a number of organizations that can assist businesses in finding the right local partners in different regions.
Export.gov brings together resources from across the U.S. Government to assist American businesses in planning their international sales strategies and succeed in today’s global marketplace.
Also try your trade association if you have one. The advantage of using organizations such as these are that you will often get general market guidance in addition to your specific needs. Further advice on expanding your operations overseas is available through the sba.gov.
There are some commercial organizations that can help you locate the right partner, usually at a cost or as part of a package of other services offered. Those such as global private equity businesses offer an international network of connections. Others are smaller and more focused in your market or industry, for example RTM Asia is specifically interested in tech start-ups in the Asia Pacific region. It’s worth researching what services already exist in your specific market and industry.
Embrace digital channels
Social networking sites such as LinkedIn offers the opportunity to network in an online environment. On LinkedIn, you can use existing contacts as stepping stones to other individuals, or search for organizations with profiles on the site. LinkedIn offers a paid service called InMail to message people through the site with your profile details connected to the message. If you choose this route, make sure it’s highly targeted and be very clear why you are contacting them and what you want.
Before you start using LinkedIn for partner research, it’s an excellent idea to update your own professional profile and that of the organization you represent. Make sure all your messages are aligned when you make your approach, so that you appear consistent and professional.
If you’re specifically looking for suppliers or manufacturers for your product, you can start by looking through sites such as Alibaba.com, MadeInChina.com and GlobalSources.com. You may find this a bit overwhelming so consider going through an agent who can pre-screen these for you.
Vet your partner
The way you assess your prospective partner will be specific to your needs and your industry, but here are some general pointers:
- Obtain as much evidence as you can of their track record and speak to previous partners or clients where possible.
- Ensure you see their business premises, understand the team they have in place and ensure they have the ability to deliver on what they promise. This includes the relevant technology, capacity and human skills.
- Assess their financial stability, local reputation and market position.
- Find out their business aims and culture and whether they are compatible with your own.
- Assess the scale of their operations and whether they can grow alongside your business.
- Ensure you can communicate with your partner: not only with the leadership team but also with your day-to-day contacts.
- Be wary not to give away too much in return for market access. A successful partnership benefits both parties.
Take your time
It’s important to appreciate how long it will take to find a suitable partner, complete the vetting process and make a deal. Many companies underestimate the length of time it will take to both locate a prospective partner and complete the negotiations. It’s an important business move so give it the time it needs. Bringing in external help such as a third party will speed things along and allow you to focus on other business tasks during the search. In the long run this may be a cost saving if it delivers the right partnership more speedily.
Manage the relationship carefully
The way you manage the partnership is critical to its success or failure. It’s important to lay down your expectations in written form as much as is possible so that communication is explicit and both sides agree to it. Communicate regularly and ensure your messages are understood. It’s also advisable to get legal advice from an early stage and make sure you have a watertight legal contract before you commit.