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The Pre-Joint
Venture Checklist:
Before
you "sign the dotted line", review this checklist
to make sure that you're doing the right thing - at the right
time - and with the right partner!
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 favour 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. Proceed with
caution: You don't want to let potential profits slip through
the cracks - but similarly, you also don't want to waste your
time on a "lopsided" deal...
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, multi-million 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 desperatey!?
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. When it comes to
developing ad copy, sales letters, endorsements and marketing
material, it is always best to hire or consult an experienced
copywriter or marketing consultant with a proven track-record
- especially when there's so much money at stake!
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 hap-hazardly throw together an endorsement or some other
form of JV promotion - with their focus entirely and only on
immediate profits. Make SURE that you will profit both short
term AND long term - but focus on the "long term"
(aka: backend) profits. Integrate your partnership in such
a way that it will provide both of you with continual, consistent
income for years to come - if not, you're
leaving the majority of your "could-be" profits on
the table...
9. Is
it a Fair Deal? This is specifically directed at partnerships
involving a product owner and a "list" owner. As
a general rule, the partner that already has the client-base
should be receiving more up-front profits than the one that
is gaining both sales AND clients - because if they're smart,
they'll make more on the "backend" with their newly
acquired clients than they will short-term with the endorsement.
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 client-base 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 salesletter of the century -
or a new partner.
13. How
often does the Endorser contact their "List"?
If the client-base 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 hard-earned 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. Was it a success? A "win/win"?
If they have NOT, you may need to educate them on the fundamentals
of joint-venturing - even during an active partnership.
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 co-marketing 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 open-ended? 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 small-business 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
bottom-line continues to benefit from it - well after
the JV has been "done" or integrated?
-
Chris
Rempel, JV-Web.com
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