How To Build Merchandising Partnerships

As the retail market changes from time to time, it's more important now more than ever to build merchandising partnerships. Entrepreneurs should constantly innovate and look for the next opportunity to form brand partnerships with others.

Collaborating with other businesses will expand their reach and expose them to new ideas and tactics. It allows them to test these new concepts before integrating them into their business. Early adopters become brave innovators if it works, and both parties end up with more customers and sales.

Striking up those winning partnership agreements may not always come easily. It usually takes time and effort to find, vet and attract potential partners. Entrepreneurs must carefully draft the terms and conditions of the agreement for both parties to ensure that costs and responsibilities are clear.

Tips on how to build merchandising partnerships

Identify the right partner

Identifying whom to partner with and your partnership's nature is a crucial first step in the right direction. When seeking a partnership, the type of outreach approach will depend on the parties involved and the agreement they have with one another.

Businesses should consider the following when picking a potential merchandising partner:

• Complementary services: These are partners that offer products and services that complement each other. A one-stop wedding shop can partner with a florist, caterer, photographer, band and others, or an e-commerce store can partner with a delivery company.

• Similar services: Two or more companies with similar services can form partnerships to make the pie larger for all of them. When it comes to advertising, having cooperative advertising with several partners in one big ad that none of the partners can afford is quite a whopping advantage. A big restaurant festival with 50 participants will surely benefit each of the businesses.
• Similar customers: If two or more companies have similar customers or fan bases with not too much overlap, they can form partnerships. This is one of the success secrets of most internet marketers. They form partnerships and promote each other to boost their sales.
• Complementary operational service: When two or more businesses have complementary operational expertise, they can form partnerships to increase their sales. Consider the partnership between FedEx and the Postal Service in the United States. FedEx is a big logistics company. It will bring in different parcels from all over the world to the United States. Meanwhile, the United States Postal Service is good at the house-to-house delivery all over the country. Their partnership will bring about faster delivery of the parcels and make the work easy for both companies, increasing their sales.
• Have the same mission: If two businesses have the same or similar mission aligned with each other's brand identity, they can form partnerships with each other. A restaurant can form a partnership with a food pantry or a construction company can collaborate with a house mortgage company.

Reach out in a strategic way

After identifying potential partners, entrepreneurs need to reach out to them strategically. The potential partners will typically not want to form partnerships with any other business, but you have to convince them to do so for their benefit. The strategy to use will depend on the company and the desired type of partnership.

The following are some ideas that you can use to reach out to potential partners.

• Become their customer: This is the best bet for reaching out to most small or local businesses. Be a customer yourself and experience their product or services first-hand. Then form a lasting relationship with their managers or owners before the idea of partnership is brought up. This will help to reduce or avoid rejection of partnership opportunities.
• Find key contacts: Landing partnership deals with big companies may seem complicated, but it is not impossible. Many small businesses have done it before, but with the right strategy. Finding the right person to contact is a crucial step. Getting to speak with them is another hurdle you need to overcome as many of these managers are busy. Call as many times as possible until a business meeting is on the books with your potential partner. Then convince your potential partner of the benefit their company stands to gain as a result of the partnership.
• Attend business events: Business events are functions that some entrepreneurs take for granted. This will allow entrepreneurs to meet face to face with the company representatives and even the procurement officers. Companies attend these business events for matchmaking and to meet potential partners, all in efforts to expand and grow their business.

Complete a test run

After landing a partnership deal, it is important to test the partnership first before putting in the full-time commitment. Then measure your results and use them to decide on whether to continue or cancel the partnership.

The agreement

Entrepreneurs should be careful when drafting the partnership agreement. It should focus primarily on what your company intends to achieve or accomplish. Ensure the agreement favors both parties, and don't forget to seek legal advice on such an important partnership.

Final verdict

Landing a partnership with other businesses is a great achievement because it will help move a business to the next level of success. But make sure you partner with the right company by following the steps discussed above.