The Power of Two: Partnerships in the Manufacturing Industry
The Power of Two: Partnerships in the Manufacturing Industry
A lot of entrepreneurs are confused by the word partnership when it comes to the manufacturing industry. And no wonder. Whereas the term used to apply to old-school joint ventures, now it can just as easily be used in the context of modern distribution, licensing or joint development deals. To start a new business in this traditionally cash-strapped, union-laden industry, it’s important to understand the attributes of a partnership in the manufacturing industry, and success stories of the most beneficial types of partnerships for small businesses.
True Partnership Characteristics
A true partnership between companies exists when joint efforts are multi-faceted, in that they are conducted in two or more areas of business. This differentiates a true partnership from a single-facet relationship with a vendor, supplier, or service organization. A wide variety of partnership types are available to companies in the manufacturing arena which increase revenue and margins by:
• Eliminating operational inefficiencies by shutting down an under-producing division and creating a joint development partnership
• Eliminating the need for new equipment and capital by creating a manufacturing partnership
• Eliminating the necessity to have an expensive engineering staff through an engineering partnership
• Eliminating costly overseas offices required to penetrate a new market through a joint sales and distribution partnership
The Power of Two: Joint Development
A true partnership embodies the face-paint wearing shirtless enthusiasm and commitment of a football fan attending a December playoff game. It means both parties have the motivating factors which produce a commitment to succeed. In short, one or both firms must increase, extend, or create an existing business practice to support the specific needs of its new partner. It might also mean changing your own product design and development to better serve the customer base.
Take the recent joint development partnership of Matrix One and Formation. Both firms acknowledged stagnant growth and underwhelming revenues, so a joint development partnership was created to reduce overlapping products and entrench both deeper in the customer base. Marketing jargon aside, this partnership hits the bottom line in the form of cost savings of marketing, sales and engineering personnel. It also prevents customers from choosing one solution over another. In short, the partnership was a good proactive move that is equally defensive against adverse market conditions.
Engineering Partnerships
If the intent is not to create new products but optimize margins, manufacturing partnerships in particular can be used to offload your growing pains, which keeps your part of the business “short and profitable,” according to Sunstream Corporation’s CEO Ken Hey. As a designer of boat lift products, Hey placed the risk of hiring people and equipment, two aspects which are very capital intensive, onto the infrastructure of his partner, Elliott Bay Manufacturing. Because of the engineering and manufacturing partnership Hey created at the earliest stages of his business, he was free from these burdens, as well as the need for outside financing. This allowed Sunstream to reach profitability before accepting outside financing.
Field Sales Partnerships
Sometimes, two firms going to partner to do one thing: increase sales activities. This is the case for Descarte who got industry lion Hong Kong Bank to share its customers. In a single partnership, Descarte created a market aggregator effect; Hong Kong Bank will aid in the marketing and sales efforts of the Descarte solution, and it is only common sense that a percentage of customers will in turn, believe the Descarte solution good enough to deploy to their own customers. This creates a market aggregator effect whereby Descarte could potentially win an entire industry. Forget the fact that this wisely reduces cost on Descartes marketing team and likely cuts the sales cycle, or whether or not Hong Kong Bank gets a cut is irrelevant,. Hong Kong Bank likely opened up the customer Kimono in order to retain customers and increase loyalty in a dynamic and competitive market.
Manufacturing Partnerships
A huge, untapped resource of manufacturing talent exists in nearly every country on earth: the penal system. Elliott Bay Manufacturing was required by its partnership with Sunstream to both engineer and manufacture the boat lifts. In turn, Elliott Bay Manufacturing tapped into the good men over at the Washington State Penitentiary and now employs a portion of the state’s prison work force to create his engineering designs. This single faceted vendor status evolved to become a partnership, since the specialized workforce is trained by Elliott Bay to required quality standards, and provided with detailed materials, drawings and other essential information about the supply chain. While the penal system and the inmates receive compensation, Elliott Bay’s costs are dramatically lower than employing union workers in a more traditional machine shop. , Sunstream products are offered at a lower price to the consumer, and the entire product supply chain from creator, designer, manufacturer and installer to consumer benefit from the smart partnerships created.
Other available partnership options
Land, distribution, facilities, distribution and operation partnerships dramatically improve margins even in the most constrained market. The key is to balance corporate objectives with short and long term tradeoffs. So before discounting the entire business tool of partner development as a waste of time, consider how each facet of business can operate more productively, efficiently and at a higher margin with a partner than going it alone. As you become more familiar with the best partnership to accomplish your objectives, you will be able to pinpoint the type of partnership necessary and the specific attributes for the partnership. In so doing, you will be able to accurately discern partner development reality from misconceptions and results from hype.
The Power of Two Partnerships in the Manufacturing Industry - To learn more about this author, visit Sarah Gerdes's Website.
Like this article? Share it with your friends
The Real Definition
A lot of entrepreneurs are confused by the word partnership when it comes to the manufacturing industry. And no wonder. Whereas the term used to apply to old-school joint ventures, now it can just as easily be used in the context of modern distribution, licensing or joint development deals. To start a new business in this traditionally cash-strapped, union-laden industry, it’s important to understand the attributes of a partnership in the manufacturing industry, and success stories of the most beneficial types of partnerships for small businesses.
True Partnership Characteristics
A true partnership between companies exists when joint efforts are multi-faceted, in that they are conducted in two or more areas of business. This differentiates a true partnership from a single-facet relationship with a vendor, supplier, or service organization. A wide variety of partnership types are available to companies in the manufacturing arena which increase revenue and margins by:
• Eliminating operational inefficiencies by shutting down an under-producing division and creating a joint development partnership
• Eliminating the need for new equipment and capital by creating a manufacturing partnership
• Eliminating the necessity to have an expensive engineering staff through an engineering partnership
• Eliminating costly overseas offices required to penetrate a new market through a joint sales and distribution partnership
The Power of Two: Joint Development
A true partnership embodies the face-paint wearing shirtless enthusiasm and commitment of a football fan attending a December playoff game. It means both parties have the motivating factors which produce a commitment to succeed. In short, one or both firms must increase, extend, or create an existing business practice to support the specific needs of its new partner. It might also mean changing your own product design and development to better serve the customer base.
Take the recent joint development partnership of Matrix One and Formation. Both firms acknowledged stagnant growth and underwhelming revenues, so a joint development partnership was created to reduce overlapping products and entrench both deeper in the customer base. Marketing jargon aside, this partnership hits the bottom line in the form of cost savings of marketing, sales and engineering personnel. It also prevents customers from choosing one solution over another. In short, the partnership was a good proactive move that is equally defensive against adverse market conditions.
Engineering Partnerships
If the intent is not to create new products but optimize margins, manufacturing partnerships in particular can be used to offload your growing pains, which keeps your part of the business “short and profitable,” according to Sunstream Corporation’s CEO Ken Hey. As a designer of boat lift products, Hey placed the risk of hiring people and equipment, two aspects which are very capital intensive, onto the infrastructure of his partner, Elliott Bay Manufacturing. Because of the engineering and manufacturing partnership Hey created at the earliest stages of his business, he was free from these burdens, as well as the need for outside financing. This allowed Sunstream to reach profitability before accepting outside financing.
Field Sales Partnerships
Sometimes, two firms going to partner to do one thing: increase sales activities. This is the case for Descarte who got industry lion Hong Kong Bank to share its customers. In a single partnership, Descarte created a market aggregator effect; Hong Kong Bank will aid in the marketing and sales efforts of the Descarte solution, and it is only common sense that a percentage of customers will in turn, believe the Descarte solution good enough to deploy to their own customers. This creates a market aggregator effect whereby Descarte could potentially win an entire industry. Forget the fact that this wisely reduces cost on Descartes marketing team and likely cuts the sales cycle, or whether or not Hong Kong Bank gets a cut is irrelevant,. Hong Kong Bank likely opened up the customer Kimono in order to retain customers and increase loyalty in a dynamic and competitive market.
Manufacturing Partnerships
A huge, untapped resource of manufacturing talent exists in nearly every country on earth: the penal system. Elliott Bay Manufacturing was required by its partnership with Sunstream to both engineer and manufacture the boat lifts. In turn, Elliott Bay Manufacturing tapped into the good men over at the Washington State Penitentiary and now employs a portion of the state’s prison work force to create his engineering designs. This single faceted vendor status evolved to become a partnership, since the specialized workforce is trained by Elliott Bay to required quality standards, and provided with detailed materials, drawings and other essential information about the supply chain. While the penal system and the inmates receive compensation, Elliott Bay’s costs are dramatically lower than employing union workers in a more traditional machine shop. , Sunstream products are offered at a lower price to the consumer, and the entire product supply chain from creator, designer, manufacturer and installer to consumer benefit from the smart partnerships created.
Other available partnership options
Land, distribution, facilities, distribution and operation partnerships dramatically improve margins even in the most constrained market. The key is to balance corporate objectives with short and long term tradeoffs. So before discounting the entire business tool of partner development as a waste of time, consider how each facet of business can operate more productively, efficiently and at a higher margin with a partner than going it alone. As you become more familiar with the best partnership to accomplish your objectives, you will be able to pinpoint the type of partnership necessary and the specific attributes for the partnership. In so doing, you will be able to accurately discern partner development reality from misconceptions and results from hype.
The Power of Two Partnerships in the Manufacturing Industry - To learn more about this author, visit Sarah Gerdes's Website.
Like this article? Share it with your friends
![]() | |
| |
No article feedback found. |
| |
Leave Your Feedback |
|
| |
| |||
John PowerJohn Power, founder of Biltmore Franchise Consulting, has extensive experience developing and marketing franchises and business opportunities. He has been in and around franchising for over twenty years. From 1980 through 1990 he conceptualized, organized, and developed the American Video Association. He grew AVA to 2,000 national members, before selling the company it 1990. It was later merged into another home video marketing company. From 2000 to 2005 he worked as a contract marketing and human resources consultant to several local and national companies. In 2005 Mr. Power began working as a franchise development consultant on a full-time basis. Since that time he has helped more than three dozen companies initiate and develop their franchising program. He notes that there are many companies interested in developing a franchise program, and who need his specialized assistance. Mr. Power is a “hands-on” franchise consultant. He said, “I am the ‘nuts and bolts’ person who tends to the details for my clients.” Mr. Power holds a B.S. degree with a major in Marketing. See: www.biltmorefranchise.com You may contact Mr. Power at: jpower@biltmorefranchise.co - Visit John Power's Website |
|||
Linda RichardsonLinda Richardson is the Founder and Executive Chairwoman of Richardson, a global sales training and performance improvement company. As a recognized leader in the industry, she has won the coveted Stevie Award for Lifetime Achievement in Sales Excellence and she was identified by Training Industry, Inc. as one of the “Top 20 Most Influential Training Professionals.” Ms. Richardson is credited with the movement to Consultative Selling and is the author of ten books on selling and sales management, including Sales Coaching — Making the Great Leap from Sales Manager to Sales Coach, and Stop Telling, Start Selling. She teaches sales and management at the Wharton Graduate School of the University of Pennsylvania and the Wharton Executive Development Center. Linda is a frequent speaker at industry and client conferences, has been published extensively in industry and training journals, and has been featured in numerous publications, including The Wall Street Journal, Forbes, Nation’s Business, Selling Power, Success, and The Conference Board Magazine. Learn more about Richardson's sales training and performance improvement solutions at http://www.richardson.com web - Visit Linda Richardson's Website |
|||
Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
|||
Dave KurlanDave Kurlan is the founder and CEO of Objective Management Group, Inc., the industry leader in sales assessments and sales force evaluations, and the CEO of David Kurlan & Associates, Inc., a consulting firm specializing in sales force development. Dave has been a top rated speaker at Inc. Magazine's Conference on Growing the Company, the Sales & Marketing Management Conference and the Gazelles Sales & Marketing Summit. He has been featured on radio and TV, including World Business Review with General Norman Schwarzkopf, in Inc. Magazine, Selling Power Magazine, Sales & Marketing Management Magazine and Incentive Magazine. He is the author of Mindless Selling and Baseline Selling – How to Become a Sales Superstar by Using What You Already Know about the Game of Baseball. He created and wrote STAR, a proprietary recruiting process for hiring great salespeople, and he writes Understanding the Sales Force, a popular business Blog and is a contributing author to The Death of 20th Century Selling and 101 Great Ways to Improve Your Life, Volume 2. - Visit Dave Kurlan's Website |
|||
George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
|||
David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
|||
|
To learn more about the Evan Elite Author Program please contact us. | |||
![]() | |
![]()
| |
![]() | |
|
| |
![]() | |
|
| |
![]() | |||||||
|
![]() | ||
|
| ||
![]() |
| Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details. |
|
|
![]() |
| Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media |
|
|
![]() |
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"
Click Here To Learn More |
|
|
|
|
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
|
![]() |
|
|
![]() | ||
|
Top 50 Marketing Blogs
Top Blogs To Watch In 2008 | ||
|
Top 50 HR Blogs 2009
Top 50 HR Blogs 2009 | ||
![]() | ||
![]() | ||||
| ||||
| ||||
| ||||
|
|
|
|
|
||||||||||||
|
|
|
|
|












Subscribe to Sarah's articles











