Business Partner Selection Process
How to choose the right business partner for your business. The process of choosing a business partner with the detailed 10 steps below will help you clear all your questions and concerns.
1. Determining cooperation goals of the business partners
In the process of choosing a business partner, it is important for businesses to first determine the goals of cooperation.
To do this, businesses need to know what the short and long-term goals of the organization are. The target market that your business is aiming for. At the same time, identify the strengths of the business and the weaknesses that are lacking to find a partner to “fill in those gaps”.
This cooperation is not only about “win-win” but your business also needs to achieve strategic benefits.
2. Identify cooperation opportunities in the market
Research and analyze the business environment to identify cooperation opportunities to help businesses gain advantages in business.
To find cooperation opportunities, you need to identify the target market of your business – the customers who are most in need of your solutions and services.
Through this process, you identify the needs of these customer groups and seize opportunities to make your product or service viable.
3. Develop evaluation criteria and select partners
The next thing to do in the business partner selection process after identifying cooperation opportunities in the market is to develop criteria for partner selection.
You need to determine the most important criteria to choose the right partner for your business.
Partner evaluation criteria:
- Partner vision and strategy.
- Corporate and organizational culture of partners.
- Partner activities.
- The financial position of the partner enterprise.
- The risks of cooperation.
From the above criteria, you can come up with smaller criteria to find a partner business that compensates for the disadvantages of your business and has what your business needs.
4. Looking for business partners
The criteria to evaluate the business is completed. The next thing that businesses need to do in the partner selection process is to find business partners.
There are many ways to find a business partner. For example, the following 6 ways:
- Take advantage of existing relationships.
- Join industry groups and forums.
- Participate in relevant seminars, fairs, and meetings.
- Participate in industry-related training courses.
- Use Social Networking and posting sites.
- Use D&B Hoovers of CRIF D&B Vietnam.
5. Make a preliminary list of potential partners
Making a preliminary list of potential partners is a necessary step in the business partner selection process.
After the process of finding business partners, you need to select and make a preliminary list of potential partners who can cooperate and bring benefits to the business.
- Based on selection criteria to screen and list potential partners.
- Your business can use the BIR reporting solution to get information about partners and based on the criteria to choose the right partner.
- It is advisable to conduct a preliminary screening to filter out potential partners that do not provide the full benefit of your business. At this level, four issues need to be scrutinized:
– To what extent does the potential partnership contribute to meeting your organization’s strategic requirements?
– What do potential partners bring, and what are their weaknesses?
– What is the probability of successfully implementing a partnership with this entity?
– What is the opportunity cost of not pursuing a partnership with this entity?
6. Contact and exchange with potential partners
The sixth step in the business partner selection process is to contact and discuss with potential partners after selection.
- It is necessary to contact potential partners to discuss business cooperation opportunities and express their desire to cooperate as well as better understand their cooperation needs and goals.
- You can contact us by email, phone, or face-to-face.
- To achieve: gather more information about the prospective partner and introduce information about your business.
7. Evaluation and selection of the most potential partners
Through discussions with potential partners, enterprises conduct internal meetings and re-evaluate potential partners and select at least 1 business cooperation partner.
For the most accurate assessment, you need to visit the partner company and factory to observe their resources and activities, and evaluate the following factors:
- To what extent can the partner’s resources meet your company’s requirements.
- What are the factors affecting the partner’s business, is it easy to control?
- Does the partner have the necessary capabilities (financial, human resources, factories, …) to help successful cooperation projects?
- Your partner’s level of support for the success of your business.
8. Negotiate agreements with partners
After choosing the ideal partner, you need to negotiate the cooperation conditions of the two parties:
- Basic business terms: Price, quality, quantity, delivery, warranty, payment, shipping, discount,…
- Other support: design, training, free samples,…
9. Confirm the partnership
- Through negotiation and evaluation to select the official cooperation partner.
- Legalize the agreements between the two parties agreed in step 8 by contract. These contracts should follow the standard of the Chamber of Commerce and Industry (ICC) and should be consulted by a lawyer to ensure the legality of the contract and the benefit of the company in the event of a dispute.
10. Develop a cooperation plan
Cooperate with partners to build a plan of cooperation, development, and work between the two sides most favorably. To promote this process smoothly, the parties need to frankly share long-term and short-term goals, action plans so that the two sides can agree and come up with strategies that bring benefits to both sides in the long term.
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