Collaboration vs competition for a small business

Brigette Bard explains how to get the foot in the door with the right collaborators to move your company forward.

Small businesses face massive competition, ranging from global super-corporates and established market leaders to innovative entrepreneurs working out of their bedrooms. Sometimes it is the art of collaboration that give SMEs a strategic advantage in a competitive marketplace.

Sometimes a ‘you scratch my back and I’ll scratch yours’ approach to business pays dividends compared to a secretive competitive approach.

What has globalisation become? Super-corporates moving into new regions and competing with local traders, in a bid to make consumers believe they have always been there and understand their purchasing needs?

I thought the age of empires and invasions was in the past…

If my time leading a small business has taught me anything, it is that competition is a good thing. In many cases it’s a great thing, with dynamic ideas from innovative business owners in emerging economies challenging the existing pathways of the so-called ‘developed’ businesses.

Competition generates higher levels of service, better-quality products and new marketing strategies. This, I believe, will significantly contribute to long-term global economic growth.

But at the same time, competition is nothing without collaboration and your business’ competitive edge can be significantly enhanced with a collaborative approach.

Collaboration, among business leaders, allows organisations to create synergies, working together to generate game-changing business ideas and ground breaking concepts.

Competition and collaboration are, almost ironically, complementing strategies. My experience is that collaboration (with a healthy dose of competition) can be the compass in navigating the way through a volatile, uncertain, complex and ambiguous economic storm.

Partnering up

We should always be on the lookout for partners to work with, to share ideas, to cross-market products and, perhaps most importantly, to nurture a dialogue. But in an increasingly competitive environment, this looks like it might be easier said than done.

However, things might be changing. At the start of 2014, according to the House of Commons, there were 5.2 million businesses in the UK. While it was the first time the number of businesses in the UK has exceeded five million, there was a rapid decline in the number of organisations employing people. Instead, there was a sharp rise in companies who ran lean, kept overheads low and outsourced elements of their delivery to collaborative partners.

The days of ‘survival of the fittest’ are fading. Businesses aren’t looking to become giant corporates, where things move slowly and process overtakes profit. Many business owners, myself included, want to remain agile and make quick decisions. Instead of competing with others they are looking to collaborate, either by working with competitors who have a similar ethos to drive the growth of small businesses together, or pairing up with likeminded individuals to offer complementary services, which add value to the business and clients alike.

In my case, I run a UK-based business that provides diagnostic tests, including self tests for conditions such as HIV. These cost-effective products allow people to test themselves at a time and place that suits them and have an accurate result in less than 15 minutes.

We have a small team, but 73 million people in the world have HIV with a significant number of these being undiagnosed. In the UK there are more than 100,000 people with HIV, with a quarter not knowing they have contracted the virus, according to Public Health England. Our challenge in reaching these people is huge.

In order to reach our goal of raising awareness of HIV testing and working to eradicate the virus, collaboration has had to be at the heart of our business strategy. We have collaborated with HIV charities and organisations to work together to raise awareness; we collaborate with art galleries and theatre companies that are addressing the AIDS epidemic by providing them with information; we partner with the NHS to help them distribute tests and information; and we partner with universities and hospitals on research and development.

That’s just the tip of the iceberg – globally, and especially in emerging markets, we have built strong partnerships with like-minded organisations. All these came from an email, a coffee, a phone call or just a drink at an event

There’s no better time to take this approach than when you, and your collaborative partner, are still small. It’s a win-win for all involved:

1. Talk to the competition

Collaboration starts with a conversation. You might decide it’s too early to establish formal partnerships and so, despite being told to avoid the competition at all costs, grab a drink and talk about the big picture with some of your competitive set.

Not only is it likely they will be experiencing the same challenges as you (or better still have been through them and can offer advice), there might be an opportunity to work together and come up with strategies for developing key areas of the market for your, most likely, niche offering, in order to create a ‘bigger pie’.

Sure you may lose a piece of business to the opposition, however in the long-term both you and they will win.

2. Understand where a formal collaborative partner can add value

If you’re going to formally pair up with someone, unless it’s a merger or acquisition, it’s unlikely that you’re going to join forces with someone who offers the very same product as you (that would be like Coca Cola pairing up with Pepsi). However there are many small or micro organisations that can offer a service which sits alongside yours and allows you to offer added value to clients. For example, a marketing business could join forces with an events management company allowing them both to offer a wider range of services. Ask your clients what additional products may be beneficial…

3. Do they think like you

For a micro or small business, culture and values are vital. Anyone who joins the business, whether an employee or a collaborator, has to think the same way. It won’t work if they don’t; you’ll waste time and conflicting views can have a detrimental impact upon your business.

Related: Greg Bateman podcast – how to collaborate with other brands and how to have a successful trade show. ‘If it’s us doing all the work, that’s not a partnership. That’s me paying for some marketing activation’

Before jumping into any joint ventures, make sure you understand who you are and what you stand for and ensure you express that clearly. Then listen carefully before you make a judgment call on your would-be partner. Personalities play a key part of any business relationship and you need to be honest about your compatibility.

4. Set ground rules

A collaborative partnership is about win-win. You will need to be transparent with things like your client base and target prospects, working together to secure new projects and expand those already in existence. It’s vital that you continue to discuss and agree joint objectives as things move forward to ensure the partnership remains mutually beneficial.

It’s advisable to put this into a contractual agreement so both parties are clear and agree on the relationship, although this doesn’t have to be complicated. If this seems like overkill make sure everything is confirmed in writing, even if in an email, including items such as actions, dates and responsibilities. Then, should any imbalance occur, you can review the original agreement and refocus.

Brigette Bard is the founder of BioSURE.

Further reading on collaboration

Brigette Bard

Brigette Bard

Founder and CEO of BioSure.

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