Cooperative Web Business Strategies

In contrast to yesterdays post on Competitive Strategies today I figured cooperative strategies would be a suitable topic to discuss. Although in a way cooperative strategies can still be a form of competition if for instance you are using it to gain an advantage over larger web businesses in the industry, which for many is a good reason to form an alliance.

A few other reasons why a teaming up may be a good idea is to gain access to more clients and specifics markets, to share technology, to save time, combine skills and strategies, and ideally to obtain greater profits.

I consider there to be two main types of cooperative arrangements, these being value-chain partnerships and one which I have discussed before which is joint venture partnerships.

Joint Venture Partnerships

I have spoken a bit about joint ventures previously in the post, although I thought I’d do a quick recap here.  First of all, joint ventures are when two companies join forces and usually form a separate entity together, one which preferably doesn’t affect their own separate business. As I mentioned above there a number of benefits of teaming up with other business online. Although, I also think it is worth mentioning some of the disadvantages, which can include loss of control, in some cases lose of profits, possibility of conflicts, and loss of some future competitive advantage if technology of strategies are shared.

You can see examples of this quite often with internet marketers around the web who team up on projects. You have probably seen some of this occur with some of the internet’s major search engines.

Value-Chain Partnerships

This cooperative strategy is very commonly used, especially with larger companies. It is in a way a form of outsourcing in which a company will form an arrangement with another company to do certain activities. The reason a business would do this is to maybe cut costs, save time or possibly to take advantage of a system or technology in which the other company has in place.

One of the more popular examples of this which you have probably heard of is Apple outsourcing its IPhone assembly to Foxconn, or the many web businesses who use FedEx for managing stock and delivery.