Why Your Business Needs a Joint Venture to Grow
Shockingly, only 2% of business owners, including real estate investors understand the key importance joint ventures can play in the success of the growth of their business portfolio. Including how they can be beneficial to themselves, their company, and their team all around. Understanding joint ventures is a huge component of growth if you want to become the leader in your market to continue to grow your business acumen. Joint ventures can be a key element of business growth to tap into an underutilized business activity.
What is a joint venture?
A joint venture is when two or more businesses get together and collaborate on a specific project. Within a joint venture, there is collaboration and the businesses share their profits, losses, expenses and resources with each other. This joint venture is a legal entity that is separated from the rest of the business’s interests of the companies. They are generally characterized by sharing ownership, returns and risks as well as sharing governance of the business activity. This is when 2 companies work together to align their goals for mutual benefit from their collaborative project with the intention of increased revenue and growth.
Joint Ventures: Facts You Need To Know
The most basic joint ventures are known as referrals aka commissions, and financial advisers will often recommend these joint ventures and referral agreements because they are perceived as being a low-cost and low-risk option to build their business. The continuous payment for referrals enables the relationship between the companies involved in the joint venture and incentivizes the continuation of that relationship. Through your understanding of the fact that only 2 % of entrepreneurs recognize and utilize the importance of joint ventures, you will have an advantage in your market that you can take action to further develop your business.
It is for this simple reason that CADMEN properties have been able to access one-of-a-kind deals before they hit the market and establish a flow of capital that others don't have access to. When you have the right joint ventures in place, you will not need to spend large budgets on marketing and advertising. This will save both time and expense that can be later used to further expand your business. We have similar programs across all branches of CADMEN that are effectively enabling us to continue to expand our business and acquire more physical locations as well as real estate. Follow CADMEN Properties to learn how you can harness joint ventures to expand your business reach.
Credit to Money, People, Deal by Stefan Aarnio for source information.