What You Need To Know Before You Sign Up On The Dotted Line In A Joint Venture
1. Are you taking this seriously? Joint ventures are a big deal. You are sitting on a GOLD MINE. If you know that you’re not able or willing to commit 110 to pulling off a successful JV then do everyone a favor and call it off until you’re in a better position.
2. Is your Partner taking this seriously? If you sense that your potential partner is simply not ready to “walk the talk” or if they’re openly expressing an attitude of apathy or negativity make sure that you’re not wasting your efforts.
3. Is your partner’s product or client base truly targeted to your offer? I once coordinated a joint venture between a client and a massive multimillion dollar software company. Deep down I knew that my client’s service simply wasn’t a good fit. The offer reached thousands of people and the results were disappointing to say the least…
4. Does the product or service SELL? Is the product just a good idea or is it something that a buying market wants desperately!? Be sure to look at the real evidence as such and “do the math”.
5. Is your Partner already Successful? This doesn’t apply to every situation but generally speaking if your partner can’t help themselves how can they help you?
6. Has the marketing material been TESTED and Optimized for maximum results? A difference of even a 1 in sales conversion rate can mean thousands and thousands of dollars.
7. Are you and your partner both on the same page? Often times a misunderstanding or a lack of communication can kill a JV before it even begins. Confirm in detail the joint venture thoroughly with your partner before you sign anything. Do this in person or over the phone.
8. Do you have a definite strategic plan in place to maximize profits from the future partnership? What I’ve often seen is people that haphazardly throw together an endorsement or some other form of JV promotion with their focus entirely and only on immediate profits.
9. Is it a Fair Deal? This is specifically directed at partnerships involving a product owner and a “list” owner.
10. Is the Joint Venture a Timely Event? Consider what else is happening around your market and with other outside forces that directly or indirectly affect your niche. This includes seasonal product considerations worldwide events/disasters other competitors’ activities etc.
11. Is the Product or Service priced Effectively? Price points can have a significant impact on the marketability and performance of any given product. Often times a lower price point may actually perform much worse than a higher one. Ultimately this depends on the clientbase in question and what they are used to spending on average. If the price of this offer is greatly higher than what the “list” usually spends the deal may flop. ie. Selling 24 ft. boats to people that normally just buy fishing tackle.
12. Does the Endorser have a Strong Relationship with their “List”? If not you’ll need either the sales letter of the century or a new partner.
13. How often does the Endorser contact their “List”? If the clientbase receives frequent contact from your Partner and if they buy related products consistently then your offer will likely perform very well. If the Endorser only stays in touch with their clients a few times a year your offer might not be as powerful.
14. How does your Partner treat his customers/clients? Check into this thoroughly. You may even want to have someone “shop” your potential partner because the last thing you want is to tarnish your own hardearned reputation with your clients by becoming “guilty by association”.
15. Has your Partner done a Joint Venture before? If they have take a close look at how their previous partners fared in terms of treatment and performance.
16. Have the “nitty gritty” details been taken care of? Who collects the money? When does the other partner get paid? How? What about refunds? Who has rights to what ie. customer lists etc? Who is responsible for what? Who pays for what? Is there a comarketing arrangement/policy in place? What if you actually lose money? Etc.
17. Do you have an Exit Strategy in place? How and when will the partnership end or will it stay openended? What if it doesn’t work out as planned or ends on “bad terms”? Is there a clause in place that provides a way for both parties to stay protected in case of a bad deal?
18. Are you Really protected by your contract? A large percentage of “napkin” agreements that most smallbusiness owners or entrepreneurs tend to draft up by themselves actually wouldn’t hold much water in court if things turned ugly. Make sure to obtain sound legal advice before you sign anything.
19. What Next? Looking beyond your exit strategies and so on how can you leverage the results of this joint venture so that your bottomline continues to benefit from it well after the JV has been “done” or integrated?
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