Partnering with another business or brand can work wonders.
It can increase your brand value and awareness and help you break into markets that may have previously been considered impossible. And as a result, your additional revenue streams can increase.
Legally there are a few different ways this can look, from loose arrangements to full-blown joint ventures. If you’re looking to partner with another company, you have a number of options which we go into in some detail below and further on their dedicated guide pages.
It is likely that you are making a business referral and will need a business referral agreementif you have agreed to spend time and effort to refer leads or drive sales for another business. This is most commonly the case when for example the referrer has unique access to a market and the parties see that they can generate growth rapidly through a referral arrangement (and for the company receiving leads or sales, more quickly and cheaply than by investing directly in setting up the channel themselves).
It is designed therefore to have an end date that is clearly defined, typically because of some specific outcome (like for example a trade fair that the parties organized together and has now been held). After that, there are no further ongoing obligations or continuation of the partnership.
It is a very commonly used commercial agreement for this reason, and the same two companies may enter into many such agreements over a number of years.
To use the example above, if the trade show is successful and becomes an annual event, there is likely to be a project collaboration agreement signed by both the companies each year for the work they contribute and the benefits they each derive.
Are you partnering with another company to develop long-term business goals?
For longer-term and even ostensibly indefinite contracts, the challenges naturally become more complex. A business collaboration agreement is more like a marriage than a holiday romance, and just as marriages are more complicated so too do they bring greater rewards.
There are as many reasons for long term partnerships as there are commercial reasons for pairing up with another company and so the substantive content of each agreement is quite likely to be very different:
If for example, the project involves real estate then there will be specific provisions to protect the property being used in connection with the project.
If the project is a tech project then there will be specific provisions to set out who owns and has responsibility for the intellectual property created in the project.
It is not strictly speaking a partnership, since there is a franchisor (the company that owns the franchise) and a franchisee (the company that operates the franchise) which is more like a parent-daughter arrangement. However, we include it here for completeness.
For more information on franchising, please read our detailed guide.