skip to log on skip to main content
VoiceOver users please use the tab key when navigating expanded menus

Business partnership agreements & developing alliances

Key points in this article

  • The benefits of alliances
  • Choosing the right partner
  • Avoiding hassles

A strategic alliance is usually two or more businesses working together for their shared benefit. Each business gets to keep their independence while finding ways to make the benefits of the alliance between them greater than their individual efforts.

What are the benefits?

Lower-risk growth

As part of an alliance, you’ll have greater bargaining power in the market without the risks of rapid expansion. Alliances may help you:

  • Get bulk discounts
  • tender for larger contracts
  • provide stronger competition to big business
  • keep overheads down.

Improving your image

A well-respected partner’s reputation can rub off on your business and build your credibility overnight.

Improving your profit margins

You can ease the pressure on profits with the right strategic alliance, by lowering your supply costs or sharing costs for research and development or marketing. You can also pool resources with partners or use each other’s equipment and skills for cheap rates.

Reaching new customers

Your alliance could provide a shortcut into a new market or pair your new product with an established brand. If your new partner is based overseas, you might be able to leverage some tax advantages – but seek specialist taxation advice.

A strategic leg-up

A strategic alliance can be a great way to gain a competitive advantage. If you have complementary products, you can offer one-stop-shop convenience or you may be able to have lower prices. Finding a compatible partner is the vital part of a successful alliance.


How do I choose the right partner for my alliance?

Alliances should be between businesses with genuine synergy. If the overlap of agendas is strong, you’ll pull in the same direction. Aim to:

  • do your research on potential partners
  • ask around at trade associations
  • examine your supply chain
  • think about who your customers buy associated products and services from

This will help you find compatible organisations with similar values to your own that may be worth talking to about a future alliance.

The benefits of alliances include improving your image, reaching new customers and keeping overheads down

Make your alliance work for everyone

A key to any successful alliance is crystal clear communication. You’ll need a transparent plan as to how you’ll work together effectively. To make your alliance work, consider:

  • scheduling regular meetings to discuss what’s going well, plus any issues
  • how you’ll allocate resources – what will each of you contribute and how will you share returns
  • asking your customers what they think about the alliance

For a large or complicated alliance, consider appointing a project manager to oversee its development.

Avoiding future hassles

There is the potential for legal disputes by working in an alliance if things don’t work out, so think carefully before you join forces. Take time over your agreement, always put it in writing and get your legal adviser to look it over before signing anything.

Be specific about what each partner will contribute and who’ll have ownership of any intellectual property the alliance generates. Include an exit clause in the agreement so you’re clear from the start how the relationship will end.

The benefits of alliances include improving your image, reaching new customers and keeping overheads down.

Related articles

Should you accept outside capital to grow your business

Accepting outside capital, where someone usually invests in your business in return for a percentage of the shareholding, can be exciting. It offers cash that you can use to grow a lot bigger.

Keep reading



How to get the most out of your bank manager

Banks are vital to the success of any small business. Not only will they provide good advice and help with planning, but they can also point you in the direction of others in your industry that can help you and provide networking opportunities. 

Keep reading



Five ways to shorten your business cash cycle

Shortening your cash cycle will boost your cash reserves, keeping your business going and providing a buffer in times of financial uncertainty.

Keep reading



Get in touch

Request a call back

Have us call you back to discuss your business needs

Leave your details


Talk to someone local

Chat with one of our local business bankers

Find your local business banker


Any advice does not take into account your personal needs, financial circumstances or objectives and you should consider whether it is appropriate for you.

ANZ recommends you read the applicable Terms and Conditions and the ANZ Financial Services Guide (PDF 104kB) before acquiring the product.

This page contains only general information which is subject to change and is not a substitute for commercial judgement or professional advice. This information does not take into account your personal and financial needs, particular objectives and/or circumstances, and you should seek appropriate independent advice (which may include property, legal, financial, taxation and accounting advice) before making any decisions, investing, or acting on it.

Tools, templates, checklists, and calculators (“ANZ Tools”) linked or referred to on this page, are only some of many ways to analyse a business or industry, or to assist your planning and business decision making. You should seek the assistance of your accountant, business or other advisor when either planning for or analysing your business.

To the extent permitted by law, all members of the ANZ group of companies, their employees, officers and contractors (“ANZ“), offer no warranty and disclaim liability or responsibility to any person for any actions, claims, costs, demands, liability, or direct or indirect losses or damage that may result from using or relying on the information set out in the pages or the ANZ Tools, and / or any act, omission or error, by any person in relation to them.  To the extent permitted by law, ANZ makes no warranty and has no liability in respect of your use and reliance. ANZ Tools are also subject in many cases to further specific cautionary wording and disclaimers which you should read.

ANZ tools, templates and checklists are only some of many ways to analyse a business or industry to assist your planning and business decision making. You should seek the assistance of your business advisor or accountant when either planning for or analysing your business' performance. To the extent permitted by law, ANZ makes no warranty and has no liability, in respect of your use of and reliance on these tools.