Choosing the Right Business Partners
Partnerships are a fundamental part of any business, and how and why you pick those specific partners is just as important.
The first step is to define what a strategic partner is. Says Ted Frazer, national marketing manager of Seeff: “Companies often enter into beneficial associations and partnerships with other organisations; however, in most instances these are ‘exclusive marketing relationships’ and not true ‘strategic partnerships’.
“We define strategic partners as those that have a real impact on our business and positively influence our core business – and bottom line. In this light, we would view Ooba as a strategic partner, as well as the leading banks and lending institutions.”
In addition to whether the partner adds value to Seeff’s core offering, says Frazer, there are two other aspects the group considers when evaluating partners, namely (a) brand association (the partner’s corporate brand profile and values must align with Seeff’s, and there needs to be brand synergy), and (b) the partner must be of the same or similar stature and “ranking” within its category sector as Seeff is in its own.
“When it comes to assessing value, the primary focus here is the customer,” Frazer continues. “A potential partner must add demonstrable value to the customer, through service, cost saving or other similar benefits that would enhance the overall customer service experience. Naturally, a suitable partnership – even exclusive marketing relationships – can also provide a competitive advantage through adding value to a customer’s experience. When assessing a potential partnership, an important component is to think long term and ensure that the due diligence process is thorough up front. Ensure that the partnership really will add value and / or provide a competitive advantage. Also make sure that the brand association is a good one that enhances your brand.”
Private Property’s chief operating officer Simon Bray agrees: “Private Property embraces partnership as a fundamental philosophy of our business. We don’t see ourselves as just a property portal but rather as a marketing partner to our real estate advertisers and the consumers they serve. We have worked hard in the past three years, coming alongside our clients and ensuring that we build their value first and foremost. That is what true partnering is about: building the vision for all parties before your own.
“Certainly, there are times when partnerships don’t work out. This is most often the result of differing value systems. Great partners value the same things you do. For us here at Private Property, any business that values quality, service and relationship before cold, hard cash is a partner that we work well with.
“The world has moved on so quickly in the past decade. It is now hyper-connected on all sorts of levels. Social networks in particular have driven this engagement. With this enhanced connection between people has come the requirement to partner in business more often and at a deeper level: ’I work for’ has changed for the better to ‘I work with’.”
So, what are the main reasons for seeking out a strategic business partner? Partnerships have always been vital to the real estate industry, be they between the property group and providers of essential services (such as bond originators or partnerships forged with legal providers) or corporate partners. Adding value to your business is key when looking for strategic business partners.
“You should find experienced businesses with objectives that align with your own, and businesses that have a passion for what they do,” says JP Farinha, CEO of Property24. “A mutually beneficial relationship will yield the most investment from both parties. Evaluate up front if this partnership will help you achieve your short-term or long-term goals and, accordingly, weigh up how much to invest in it.
“Then, of course, do your homework and ensure that there are credible people managing the business with a good track record. In a partnership, you will spend a great deal of time working with the management team and it’s important to evaluate whether or not your companies ethics are aligned. Make sure that when your names appear in the press together, it’s an association that you are proud of.”
Sometimes, a partner can also be an asset to a company. Says Pam Golding Property Group Chief Executive Andrew Golding: “We work closely with a number of third-party organisations that have specialised knowledge which adds value to the buying-and-selling transaction cycle. Two of the more important are attorneys, who assist in the conveyancing process to facilitate transfer of a property from a seller to a buyer; and mortgage originators, who work closely with agents, buyers and the banks to obtain a bond-finance solution that enables purchasers to meet their financing obligations as set out in the offer to purchase.
“Our decisions to use or to recommend a particular professional service provider are based on a number of factors, including appropriateness and quality of service provider, competitive cost, location, benefit to our clients and preferential procurement requirements that may be indicated by the applicable charter / codes of good practice.
“It is essential that they have the service ethic and professional capability to offer our clients a service experience that meets our high expectations. We will only enter into third-party relationships where we can be assured that our clients will enjoy the best possible service experience that is also cost-effective. Their value lies in the service and professional expertise they offer the client as well as in their value-for-money cost structure.”
The most important piece of advice that Golding has to offer in terms of finding the perfect partners for your business is to ensure that they have the expertise to deliver the anticipated service and that their service values and professionalism are aligned with your own. They must take responsibility for their delivery to the clients and provide timeous feedback to your clients and to you.
According to Lew Geffen, chairman of Sotheby’s International Realty, the group’s biggest assets/partners in the property industry are mortgage originators and attorneys. When they weigh up the decision of whom to partner with, they weigh up reputation, research and ethics. Says Geffen: “What sets these arrangements apart is the value of the relationships, measured by the quality of the service we get. The best advice I can offer your audience, in terms of considering strategic partners, is to research them thoroughly first.”
“We like to work with companies whose service ethic aligns with our own, but the client always has the final say,” says Berry Everitt, MD of the Chas Everitt International Property Group. “Our preferred originator, BetterLife Home Loans, assists our buyers in qualifying and applying for bonds. Then there are all the various attorneys we work with. They ensure that the transfers go smoothly, – although we have no formal relationship with them as ‘partners’.”
For companies and organisations providing complementary services, the main benefit arises when their joint efforts align to enhance the overall customer experience. “Focus,” advises Everitt when asked for the best advice he can give readers who are looking to partner with complementary businesses in order to offer more value to prospective clients.
“Our mortgage origination partner, Ooba,” responds Richard Gray, CEO of Harcourts Real Estate, when asked to name the company’s key strategic partner. “Getting property finance is one of the most critical steps in the sale of a house. When one considers the time and effort it takes to sell a house, one needs to ensure that you are working with the best home finance expert.
“Reputation and ability are essential,” he continues. “If we refer a buyer to a partner, we need to be sure that they are up to standard and will offer the best service. It is also critical that a partner shares similar values and ethics to your company. The key to a partnership is that it needs to be mutually beneficial. One partner cannot feel that they are being disadvantaged. Partners need to add value to each other; in other words, they should both feel that they would lose something if the partnership dissolved. Once again, if both partners share similar values, there is a higher chance of the partnership being sustainable.
“My best piece of advice? Firstly, understand what would add value to your clients. So don’t partner for the sake of partnering. Secondly, find a company that will complement yours in terms of offering a consistent experience to the client. Finally, an acid test is, would you employ your partners in your business if you needed to? This will tell you a lot about what you think of their abilities, values and culture.”
Choosing a strategic business partner is a delicate process that requires thorough investigation, focus and dedication. You can add real value not only to your business, but also to your clients’ experience by choosing the right business partners and entering into the right partnership agreements. By following the experts’ advice, you are one strategic partnership away from taking your business to the next level.
Words: Angelique Redmond