A business is considered to be successful, if it’s making profits, growing exponentially, and expanding its footprint in new markets. For that to happen, it is vital for any business to strike winning deals and join hands with potential partners. While it goes without saying that pragmatic pacts and futuristic partnerships can propel a business to new heights, there’s always a looming fear of things not turning out as expected and ruining the economic prospects. But there are certain safeguards which can ensure success in striking mutually beneficial deals and bringing down the element of risk. Here are some quintessential measures that entrepreneurs need to follow before entering into any agreement, deal or partnership:
The longevity and sustainability of any partnership or deal will depend on how reliable and competent the prospective partner or client or anyone you work with is. It’s important you carefully assess the prospective partner’s strengths, weaknesses, and position in the market. The Better Business Bureau, industry associations and credit-reporting agencies are the right instruments to check the potential partner’s economic history and overall financial health.
Once you are fully convinced about forging a tie-up, the next logical step will be to ask yourself how your company will benefit with the business deal in the long run. You need to tick all boxes and answer the questions arising on the returns the partnership will offer to your business in terms of profitability, capital gain, market share, growth potential, brand name or any other intangible asset.
Having considered all aspects financially, it’s time to prepare a business offer, which comprises the details of goods or services sought, delivery deadline, offer price, warranties or terms and conditions. The price is the key component of any deal. So propose a realistic offer which doesn’t hurt the financial prospects of your company going ahead.
Once the offer is ready, the stage is set for the negotiations. Choose the best analytical and articulate minds on the team who can put the company’s best interest forward. Brief the team about the offer and what’s the minimum they can settle on to close the deal with the prospective partner.
Once the deal is struck, give it a legal sanctity with all-encompassing clauses spelling out lease and purchase, distribution, sales, trademarks and any other aspect clearly.
Even after long-drawn negotiations, things may not work out. Remember the company’s interests reign supreme. You have to think objectively during intense bargaining. Be ready to accept the worst-case scenario, there’s always the next time.
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