definition joint business planning

What Is a Joint Business Plan (JBP)? Benefits & Best Practices

By 8th & Walton | on October 2, 2022

From small businesses to large corporations, the most successful companies begin and stick with a clear business plan. When a company defines its goals, lays out a path to meet objectives, and agrees on financial spending and expectations, it creates a shared vision and accountability to succeed.

Many businesses experience greater growth when partnering with another business. In the supplier and retailer relationship, both parties working independently would be detrimental. To create a mutually beneficial partnership, they must begin by defining each company’s responsibilities, expectations, and needs in a joint business plan.

What Is a Joint Business Plan?

A joint business plan (JBP) is the collaborative process of planning between a retailer and a supplier in which both companies agree on short-term and long-term objectives, financial goals, growth, and shared business initiatives for profitability.

Joint business planning focuses on agreeing on common objectives and aligning on a single goal or set of goals. The companies in the joint business plan must work together to accomplish a shared vision.

What Is the Purpose of a Joint Business Plan?

For retailers and suppliers, having a joint business plan can create a win-win strategy in growing consumer sales. An effective JBP allows suppliers to build stronger relationships with their retailers so both parties can mutually support and benefit from each other.

When a retailer and supplier recognize each others’ needs and agree on common goals, they can share insights to support each other and improve sales, customer growth, and processes.

How Does a Joint Business Plan Work?

Two companies can come together with a joint business plan because they have one thing in common: a shared shopper . Whether it is a supplier partnering with a retailer or a children’s clothing company partnering with a toy manufacturer, having the same target audience is the first element that brings the companies together.

The companies considering a joint business venture should then share their individual business plans and discuss their mutual growth opportunities. This is where the general goals and areas of support can be defined. Specific tactics and category strategies can also be fleshed out in early discussions before moving to the formal process.

Once both companies are in agreement that the partnership will be mutually beneficial, the joint business plan can be created. Formal contracts are drawn up, approved, signed, and the plan is ready to be executed. Periodic reviews and necessary adjustments to the JBP are recommended as needed.

Benefits of Joint Business Planning

Why enter into a joint business plan with another company? The benefits can be not only financial but educational as well:

• Aligning goals.  For a retailer/supplier joint business plan, being aligned on goals creates clarity on all other areas of the business. Defining expectations on all areas from marketing to supply chain to sales goals leaves minimal area for questions. Agreeing on goals, no matter how and when they are measured, keeps both parties accountable and benefits both to meet expectations.
• Shared resources and exposure. Partnering with another company can bring a new audience and a new platform. In a simple retailer/supplier joint business plan, the retailer can introduce the supplier’s product to its core shoppers. At the same time, shoppers loyal to the supplier’s product or brand can be introduced to the retailer’s store and website for the first time.
• Greater return on investment.  By partnering with another company with a shared vision, the benefits above will provide a better ROI when the plan is executed correctly.

Joint Business Planning Best Practices

How can companies ensure their joint business plan is a good fit for both parties? These are some best practices to include in preparation for entering into the partnership:

1. Align Internally First

Before entering into a joint business plan with another company, all members of the business must agree on the benefits of the partnership. Recognizing the advantages and seeing the bigger picture is key. When employees are in alignment within the company, it will be easier to align with the partnering company on the shared vision of the joint business plan.

2. Create the Plan Together

When two businesses enter into a partnership, the joint business plan should not be built by only one. A company sending another a complete plan or just a form to fill out is not collaborative. Both companies need to build the plan from the ground up. Collaborating in the development of the joint business plan is just as important as executing the plan itself.

3. Set Specific Goals

Expectations for success in the partnership need to be specific. “We need to grow sales” or “production costs will decrease” are good goals, but too general. Keep specifics in your plan that are as specific as they are realistic. If one company wants to grow sales by 40% in the next quarter, this should be spelled out in the joint business plan so get early support or push back from the other company.

4. Assign a Metric to Each Goal

Putting a metric with a goal keeps the company accountable to the mission of the joint business plan. For example, if the goal is to grow sales by 40% in the next quarter, it would be wise to assign a weekly growth metric. If the metric is too low over a few weeks, the plan shows that action needs to be taken immediately in order to meet the 40% sales growth goal for the quarter.

5. Communicate Responsibility and Accountability

The joint business plan is the place to eliminate all guesswork. If Company A is responsible for providing labels to Company B, be very specific about the responsible parties. Clarify that the packaging coordinator of Company A will mail the labels to the warehouse manager of Company B on the first of the month.

6. Include Risks and Solutions

Planning for setbacks is key to planning for success. The joint business plan should include any possible risks or obstacles foreseen by either company. Having solutions in place for multiple scenarios makes the plan easier to execute.

7. Constantly Evaluate the Relationship

Joint business plans work better with trust, mutual respect, and a great working relationship. Keeping the relationship healthy between the companies and individuals relying on each other brings more success to the overall plan. Monitor the relationship periodically and work to resolve conflicts as they arise.

Joint Business Plans at Walmart

Walmart works with its suppliers to create plans for sales and category growth. The company relies on suppliers to bring insights to the table to spot trends and get in front of potential gaps in the business.

Back in 2011, Walmart created a joint business plan with Proctor and Gamble to pick up lost sales in air fresheners. This category was down over 2% across the chain, but P&G brought insights to Walmart on how consumers were purchasing throughout the industry.

Consumers had no problem going to Walmart for aerosol sprays for under a dollar, but would then go to specialty stores to purchase expensive candles in the same scent. Through communicating through the joint business plan, Walmart was able to create excitement around higher price-point items and show the shared shopper they could purchase the extra items in one store.

Positive business collaborations can be extremely beneficial in growing retail sales. Two companies sharing a common vision can build on each other’s best practices and support each other to mutually win at the register.

Suppliers looking for support in their Walmart business have found great collaboration with 8th & Walton. Our team of experts supports suppliers to improve reporting, analytics, supply chain, accounting, and more. To begin a great collaboration with us, request a free 15-minute consultation this week.

About the Author

8th & Walton consists of retail industry experts with a combined 200+ years of Walmart and Walmart supplier experience. Having helped hundreds of CPG companies in their efforts to be better supplier partners to the world's most influential retailer, the 8th & Walton editorial team prides itself on being a go-to resource for Walmart supplier news and insights.

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Joint Business Plan (JBP): Benefits, Best Practices & Objectives

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Last Updated on November 28, 2023 by Arif Chowdhury

Imagine two retail brands, each with their own unique strengths and market presence. Now picture the joint business venture, with two partnering business partners, joining forces to conquer a new market together through joint ventures. This is the power of partnering with other teams in a company – a joint business plan , where executive summaries are created to outline shared goals and maximize potential.

Collaboration is vital in today’s competitive industry landscape. By forming joint ventures, companies can pool their resources, expertise, and networks to unlock new opportunities, expand their reach, and drive growth like never before.

Joint ventures allow companies to collaborate and create stronger teams , leading to increased success. A joint business plan serves as the blueprint for this collaborative venture, outlining key objectives, strategies, and tactics that both parties will execute together.

A well-crafted joint business plan typically includes an executive summary that outlines the purpose and scope of the collaboration. It also details specific marketing initiatives such as promotions or product launches aimed at capturing the target market’s attention. It covers aspects like distribution channels, branding efforts, and sales projections to ensure alignment between both parties.

In this blog post series on joint business plans, we will explore the importance of collaboration in driving success for retailers and companies in today’s fast-paced retail industry. Collaboration is crucial for the success of ventures in the retail industry.

We will delve into the key components of an effective joint business plan and provide real-life examples to illustrate its impact. So buckle up as we embark on this exciting journey towards collaborative success!

Benefits of implementing a joint business plan

Implementing a joint business plan can bring numerous benefits to retailers and companies involved in the venture. Let’s explore some of these advantages in detail:

1. Increased Alignment and Synergy between Partners

One of the key benefits of implementing a joint business plan is the increased alignment and synergy between partners. When all parties in a joint venture are working towards a shared goal, it becomes easier to align joint venture strategies , joint venture objectives, and joint venture activities.

This alignment fosters collaboration and teamwork in the venture, allowing partners to leverage each other’s strengths and expertise.

• Better coordination between teams.
• Shared vision leads to improved decision-making.
• Enhanced trust and mutual understanding.

Example: Imagine two companies collaborating on a marketing campaign. With a joint venture business plan in place, both companies can align their messaging, target audience, and promotional activities for maximum impact.

2. Enhanced Communication and Coordination

Another significant benefit of a joint business plan is the improvement in communication and coordination among partners.

Clear channels of communication are established, ensuring that information flows seamlessly between all parties involved. This enhanced communication enables faster problem-solving, timely decision-making, and efficient resource allocation.

• Regular meetings facilitate open dialogue.
• Improved sharing of information and knowledge.
• Quick resolution of conflicts or issues.

Example: In a joint business plan between a manufacturer and distributor, regular communication helps them stay updated on market trends, customer feedback, and inventory levels. This enables them to make informed decisions regarding production volumes, delivery schedules, and product promotions.

3. Improved Resource Allocation and Cost Optimization

Implementing a joint business plan allows partners to optimize resource allocation effectively. By pooling resources together strategically, partners can reduce duplication of efforts while maximizing efficiency.

This collaborative approach also helps in identifying cost-saving opportunities by streamlining processes or leveraging economies of scale.

• Shared resources lead to reduced costs.
• Elimination of redundant activities.
• Efficient use of available assets.

Example: Two companies in the logistics industry can collaborate on a joint business plan to optimize their transportation routes, thereby reducing fuel costs, minimizing delivery times, and maximizing the utilization of their fleets.

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Best practices for successful joint business planning

1. establishing clear goals and objectives.

To ensure a successful joint business plan, it is crucial to establish clear goals and objectives . This means clearly defining what you want to achieve together with your partner or stakeholders. By setting specific targets, you can align your efforts towards a common purpose.

One way to do this is by using category management principles. This involves analyzing market trends, consumer behavior, and competitive landscape to identify opportunities for growth. By understanding the category dynamics, you can develop strategies that capitalize on market trends and consumer preferences.

2. Regular Communication and Feedback Among Stakeholders

Effective communication is key in any collaborative effort, including joint business planning. Regularly communicating with your partners and stakeholders helps maintain alignment and fosters a sense of shared responsibility.

By providing feedback throughout the planning process, you can address any issues or concerns promptly. This allows for adjustments to be made in real-time, ensuring that everyone remains on track towards achieving their goals.

3. Creating a Structured Timeline with Defined Milestones

A structured timeline with defined milestones is essential for keeping joint business planning on track. Breaking down the plan into smaller, manageable tasks helps ensure progress is made consistently.

Consider creating a Gantt chart or project timeline that outlines key activities, deadlines, and responsible parties. This visual representation provides clarity on the sequence of tasks and allows for better coordination among team members.

Establishing milestones helps measure progress along the way. Celebrating these achievements boosts morale and keeps everyone motivated throughout the planning process.

4. Developing a Win Strategy

A win strategy focuses on identifying how both parties involved can benefit from the joint business plan. It aims to create mutually beneficial outcomes that drive growth for all stakeholders.

When developing a win strategy, consider factors such as market share gains, revenue growth opportunities, cost savings through economies of scale, or access to new markets or distribution channels.

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Evaluating the progress of a joint business plan

To ensure the success of a joint business plan, it is crucial to regularly evaluate its progress. This evaluation allows you to monitor key performance indicators (KPIs), conduct reviews and assessments, and make necessary adjustments to stay on track.

Monitoring Key Performance Indicators (KPIs)

Monitoring KPIs is an essential step in evaluating the progress of a joint business plan. These performance metrics provide valuable insights into the effectiveness of your plan and help you gauge its success. By tracking KPIs, such as sales growth, revenue generated, or customer satisfaction levels, you can assess whether your joint business plan is delivering the desired results.

Some key performance indicators that are commonly monitored include:

• Sales performance: Keep an eye on how well your products or services are selling. Track factors like sales volume, average transaction value, and conversion rates.
• Promotional effectiveness: Evaluate the impact of marketing campaigns and promotions on driving sales. Measure metrics like click-through rates, website traffic generated from promotions, or coupon redemption rates.
• Product performance: Assess how well specific products are performing in terms of sales numbers, customer feedback, or market share gained.
• Customer satisfaction: Monitor customer feedback and ratings to determine if your joint business plan is meeting their expectations.

Conducting Regular Reviews and Assessments

Regular reviews and assessments are vital for evaluating the progress of a joint business plan. Schedule periodic meetings with all stakeholders involved in the partnership to discuss achievements, challenges faced, and areas that require improvement.

These reviews provide an opportunity to analyze data collected from KPI monitoring and gather insights from each party’s perspective.

During these sessions:

• Share research findings: Present any relevant market research or consumer insights that can inform decision-making processes.
• Discuss results achieved: Review the outcomes achieved so far based on set goals and objectives outlined in the joint business plan.
• Identify bottlenecks and risks: Identify any obstacles or risks that may be hindering progress and brainstorm potential solutions.
• Collaborate on adjustments: Work together to determine necessary adjustments or modifications to the joint business plan, ensuring it remains aligned with changing market dynamics.

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Making Necessary Adjustments to Stay on Track

Flexibility is key when evaluating the progress of a joint business plan. As you monitor KPIs and conduct reviews, you may identify areas where adjustments are required to maximize success. Making these necessary adjustments allows you to adapt your strategies, overcome challenges, and capitalize on emerging opportunities.

Consider the following steps for making adjustments:

• Analyze data: Examine the data collected from KPI monitoring and reviews to identify trends or patterns that require attention.
• Identify areas for improvement: Pinpoint specific areas within the joint business plan that need adjustment based on performance gaps or changing market conditions.
• Collaborate with partners: Engage in open discussions with your partners to gather their input and insights regarding potential adjustments.
• Develop action plans: Create detailed action plans outlining the necessary steps to implement changes effectively.
• Monitor results: Continuously monitor the impact of these adjustments on performance metrics and assess their effectiveness.

By regularly evaluating the progress of your joint business plan, monitoring KPIs, conducting reviews, and making necessary adjustments, you can enhance its chances of success. This iterative process ensures that your joint business plan remains aligned with evolving market dynamics and increases your likelihood of achieving mutually beneficial outcomes.

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Finding the right partner for joint business planning

Identifying the ideal partner for joint business planning is crucial to the success of any collaborative endeavor .

It requires careful consideration of various factors, including complementary strengths and expertise, compatibility in terms of values and culture, as well as conducting due diligence before entering into an agreement.

Identifying Complementary Strengths and Expertise

When seeking a business partner for joint business planning, it’s essential to identify individuals or organizations with complementary strengths and expertise. This means looking for partners who possess skills and resources that complement your own.

For example, if you’re a manufacturer looking to expand your distribution channels, partnering with a retailer or distributor who has established relationships with consumers can be highly advantageous.

Consider the following when assessing complementary strengths:

• Look for partners who excel in areas where you may have limitations or gaps.
• Seek out individuals or organizations that bring unique perspectives and capabilities to the table.
• Evaluate potential partners based on their track record of success in relevant areas.

Assessing Compatibility in Terms of Values and Culture

In addition to complementary strengths, compatibility in terms of values and culture is vital for a successful partnership. When embarking on joint business planning, you’ll be working closely together towards shared goals.

Therefore, aligning values and having a similar organizational culture can foster effective collaboration.

Here are some considerations when assessing compatibility:

• Evaluate whether your partner shares similar core values such as integrity, transparency, and customer-centricity.
• Assess whether there is alignment in terms of long-term objectives and vision.
• Consider how well your respective cultures will blend together to create a harmonious working relationship.

Conducting Due Diligence Before Entering into an Agreement

Before finalizing any partnership agreement, it’s crucial to conduct thorough due diligence. This involves gathering information about potential partners to ensure they are reliable, trustworthy, financially stable, and have a good reputation within their industry.

Here are some steps to consider during the due diligence process:

• Research: Conduct extensive research on potential partners, including their history, financials, and reputation.
• References: Reach out to their existing or past business partners to gather insights into their reliability and performance.
• Legal Assistance: Engage legal professionals to review contracts and agreements to ensure they protect your interests.
• Pilot Projects: Consider starting with small-scale pilot projects to test compatibility before committing to a long-term partnership.

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Maintaining a common vision and strategic objectives

To ensure the success of a joint business plan, it is crucial to maintain a common vision and strategic objectives with your partner. This involves aligning long-term goals and ensuring a shared understanding of strategic priorities. By continuously reinforcing the importance of collaboration, you can foster a strong partnership that drives mutual growth.

Aligning Long-Term Goals with the Partner’s Vision

When embarking on a joint business plan, it is essential to align your objectives with your partner’s vision.

This alignment ensures that both parties are working towards a common goal and have a clear understanding of each other’s expectations. By taking the time to understand your partner’s vision, you can identify areas where your goals intersect and collaborate effectively.

Ensuring Shared Understanding of Strategic Priorities

In order to execute a successful joint business plan, it is vital to establish shared understanding of strategic priorities.

This involves open communication and regular discussions about the strategies and tactics that will be employed to achieve desired outcomes. By aligning your strategies with those of your partner, you can create synergy and maximize the impact of your joint efforts.

Continuously Reinforcing the Importance of Collaboration

Collaboration is key in any joint business plan, as it allows for the pooling of resources, expertise, and networks. To maintain effective collaboration throughout the partnership, it is important to continuously reinforce its importance.

This can be done through regular check-ins, open communication channels, and providing support where needed. By fostering an environment that encourages collaboration, you can build trust and strengthen the relationship with your partner.

Maintaining a common vision and strategic objectives in a joint business plan requires strong leadership and effective strategy execution. It involves aligning long-term goals with your partner’s vision, ensuring shared understanding of strategic priorities, and continuously reinforcing the importance of collaboration.

You raise the chance of reaching win-win results if you keep this alignment throughout the collaboration. Recall that effective collaborative company planning needs constant communication and a dedication to collaborating to achieve shared objectives.

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Resources to help you get started with joint business planning

Creating a joint business plan can seem like a daunting task, but fear not! There are plenty of resources available to assist you in this process.

Let’s explore some of these resources that can help you get started with joint business planning.

Online Templates for Creating Joint Business Plans

One helpful resource is the availability of online templates specifically designed for creating joint business plans. These templates provide a structured framework that allows you to outline your goals, strategies, and actions in a clear and organized manner.

With pre-defined sections and prompts, these templates make it easier for you to navigate through the planning process.

• Saves time and effort by providing a ready-made structure.
• Ensures consistency and completeness in your joint business plan.
• Provides guidance on what information to include in each section.
• May lack customization options for unique business needs.
• Requires careful adaptation to fit your specific partnership dynamics.

Industry-Specific Case Studies Showcasing Successful Collaborations

Another valuable resource is industry-specific case studies that showcase successful collaborations between businesses. These case studies offer real-life examples of how joint business planning has been implemented effectively across various industries.

By examining these success stories, you can gain insights into best practices, challenges faced, and strategies employed by others in similar partnerships.

• Offers practical examples that demonstrate the benefits of joint business planning.
• Provides inspiration and ideas for implementing collaborative strategies.
• Helps identify potential pitfalls and ways to overcome them.
• May not directly align with your unique partnership situation.
• Limited availability of industry-specific case studies may restrict options for certain sectors.

Expert Guides on Effective Partnership Management

To further support your joint business planning efforts, expert guides on effective partnership management are available as well. These guides provide comprehensive advice on building strong partnerships, fostering collaboration, managing conflicts, and maximizing mutual benefits.

They offer valuable insights from experienced professionals who have navigated the complexities of joint business planning.

• Offers expert advice and proven strategies for successful partnership management.
• Provides step-by-step guidance on various aspects of joint business planning.
• Helps you avoid common pitfalls and challenges associated with partnerships.
• Requires careful adaptation to your specific partnership dynamics.
• May not address industry-specific nuances or challenges.

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Frequently Asked Questions (FAQs)

Can any type of business benefit from joint business planning.

Absolutely! Joint business planning is applicable across industries and sectors. Whether you’re a small startup or an established corporation, collaborating with another company through joint business planning can bring numerous benefits such as increased market share, cost savings through shared resources, access to new customer segments, enhanced product offerings, and improved overall competitiveness.

How do I find the right partner for joint business planning?

Finding the right partner for joint business planning starts with identifying companies that complement your strengths and fill gaps in your capabilities. Look for organizations with similar values and strategic objectives but different areas of expertise that can add value to your offerings.

Networking events, industry conferences, trade associations, online platforms are great places to connect with potential partners. Take the time to build relationships, assess compatibility, and ensure alignment before diving into joint business planning.

What are some common challenges in joint business planning?

While joint business planning offers numerous benefits, it can also come with its fair share of challenges. Common obstacles include differences in organizational culture and decision-making processes, conflicting priorities and objectives, resource allocation issues, and communication breakdowns.

The key to overcoming these challenges is open and transparent communication, mutual respect, and a willingness to compromise when necessary.

How do you evaluate the progress of a joint business plan?

Evaluating the progress of a joint business plan requires establishing clear metrics and milestones at the outset. Regularly review these indicators to gauge performance against targets.

Maintain open lines of communication with your partner to address any concerns or roadblocks that may arise along the way. By regularly assessing progress and making necessary adjustments, you can ensure that your joint business plan remains on track towards achieving its objectives.

Are there any resources available to help me get started with joint business planning?

Yes! There are several resources available to assist you in getting started with joint business planning. Industry publications, online forums, webinars, and workshops often provide valuable insights and best practices for successful collaboration.

Consulting firms specializing in strategic partnerships can offer guidance tailored to your specific needs. Don’t hesitate to tap into these resources as you embark on your joint business planning journey.

In today’s competitive business landscape, collaboration is key to success. That’s where joint business planning comes in. By partnering with another company and aligning your goals and strategies, you can unlock a whole new level of growth and profitability. Joint business planning allows you to pool resources, share expertise, and leverage each other’s networks to achieve mutually beneficial outcomes.

But it’s not just about the immediate gains. Joint business planning sets the foundation for long-term partnerships built on trust and shared vision. It enables you to navigate challenges together, adapt to market changes swiftly, and seize opportunities that may have been out of reach individually. By working hand in hand with a like-minded partner, you can amplify your impact and create a powerful synergy that propels both businesses forward.

Ready to tap into the power of joint business planning? Start by evaluating potential partners who align with your values and objectives. Establish open lines of communication, set clear expectations, and define measurable goals together. Remember, successful joint business planning requires ongoing collaboration and commitment from both parties. With the right partner by your side, there’s no limit to what you can achieve together.

A Guide to Joint Business Planning Best Practices

• March 21, 2024
• No Comments

Joint business planning is a crucial aspect of fostering successful collaborations between companies. In today’s dynamic business environment, strategic partnerships have become increasingly prevalent, making it essential for organizations to adopt effective joint business planning best practices. This article will explore the key principles and strategies that contribute to successful joint business planning, providing insights into how businesses can optimize their collaborative efforts for mutual growth and success.

Table of Contents

The Importance of Joint Business Planning in Today’s Market

In an era defined by rapid change and increasing interconnectivity, the significance of joint business planning cannot be overstated. This section explores how businesses can gain a competitive edge, foster shared vision, and unlock mutual growth opportunities through effective collaborative strategies.

Competitive Advantage and Shared Vision

Joint business planning serves as a catalyst for companies seeking a competitive advantage in the market. When organizations come together to strategically plan and align their strengths, they create a synergy that surpasses individual capabilities. This subsection delves into how collaborative efforts can amplify competitiveness by leveraging the unique strengths of each partner.

A shared vision is the cornerstone of successful partnerships. This subsection emphasizes the importance of establishing a common understanding of long-term goals and objectives. By aligning visions, businesses can enhance cooperation, minimize conflicts, and work towards a unified purpose. Effective joint business planning ensures that all stakeholders are on the same page, promoting a cohesive approach to achieving shared goals.

Mutual Growth Opportunities and Win-Win Strategy

Joint business planning creates a framework for identifying and capitalizing on mutual growth opportunities. This involves exploring synergies between partners, uncovering complementary strengths, and strategically leveraging resources. This subsection explores how collaborative planning facilitates the identification of avenues for joint growth, leading to mutually beneficial outcomes.

The essence of successful joint business planning lies in adopting a win-win strategy. This involves creating scenarios where all parties involved stand to gain, fostering a collaborative environment based on trust and reciprocity. This subsection delves into the principles of a win-win approach, showcasing how it not only enhances the success of partnerships but also builds a foundation for long-term, sustainable relationships.

Core Elements of Effective Joint Business Planning

Collaboration is only as strong as the foundation it is built upon. This section delves into the essential elements that underpin successful joint business planning, emphasizing the importance of aligning business strategies, sharing shopper and marketplace insights, and cultivating collaborative working relationships.

Aligning Business Strategies for Success

Central to effective joint business planning is the alignment of business strategies. This involves harmonizing the goals, tactics, and overarching plans of collaborating entities. By ensuring strategic congruence, partners can maximize the impact of their combined efforts. This subsection explores the intricacies of strategic alignment and how it forms the bedrock for successful joint business planning.

Effective joint business planning goes beyond immediate gains; it incorporates a holistic approach that integrates both short-term wins and long-term objectives. This subsection discusses how businesses can synchronize their timelines and milestones to create a comprehensive strategy that facilitates sustainable success.

Shared Shopper and Marketplace Insights

An integral aspect of joint business planning is the sharing of shopper insights. By pooling data and understanding consumer behavior and preferences, partners can tailor their strategies to meet evolving market demands. 

This subsection delves into the importance of shared shopper insights and how they contribute to more informed decision-making in collaborative endeavors.

In a dynamic marketplace, staying ahead requires constant awareness. This subsection explores how joint business planning encourages the exchange of marketplace intelligence. Partners can adapt to changing trends, capitalize on emerging opportunities, and navigate challenges more effectively by combining their knowledge and resources.

Collaborative Working Relationships

At the heart of effective joint business planning is the cultivation of collaborative working relationships. Trust and open communication form the backbone of successful partnerships. This subsection explores strategies for building trust among partners and fostering an environment where transparent communication is prioritized.

Collaboration often involves navigating unforeseen challenges and capitalizing on unexpected opportunities. This subsection discusses the importance of flexibility and responsiveness in joint business planning, emphasizing the need for partners to adapt and evolve together in a dynamic business landscape.

How to Create an Effective Joint Business Plan

In the pursuit of successful collaborative ventures, crafting an effective joint business plan is paramount. 

This section outlines the key steps involved in creating a robust plan, covering aspects such as setting joint objectives, resource allocation, and addressing legal considerations.

1. Setting Joint Objectives and Account Management

The foundation of any joint business plan lies in establishing clear and achievable objectives. This subsection explores the importance of defining shared goals, aligning strategies, and ensuring that all stakeholders are committed to a common purpose. Clear objectives provide a roadmap for collaborative efforts, guiding partners toward mutual success.

Effective account management is crucial for the seamless execution of joint business plans. This involves assigning responsibilities, creating accountability structures, and establishing communication channels. 

Delving into the intricacies of strategic account management, this subsection highlights how a well-organized approach contributes to the overall success of collaborative initiatives.

2. Resource Allocation and Shared Resources

Resource allocation is a critical aspect of joint business planning, ensuring that both parties contribute and benefit equitably. 

This subsection explores strategies for optimizing the allocation of financial, human, and technological resources. By balancing contributions, businesses can enhance efficiency and maximize the impact of their collaborative efforts.

Collaborative ventures often involve the pooling of resources to achieve common goals. This subsection delves into the concept of shared resources, emphasizing how partners can leverage each other’s strengths to overcome challenges and capitalize on opportunities. 

Efficient utilization of shared resources enhances the overall effectiveness and sustainability of joint initiatives.

3. Formal Contracts and Legal Aspects

A crucial step in creating an effective joint business plan is the establishment of formal contracts. This subsection explores the importance of clearly defined agreements, covering aspects such as roles and responsibilities, dispute resolution mechanisms, and exit strategies. 

Robust contractual frameworks provide a solid foundation for trust and transparency between collaborating entities.

Navigating the legal landscape is essential for the success and longevity of joint business ventures. 

This subsection delves into the legal aspects involved in collaborative efforts, addressing issues such as intellectual property, confidentiality, and compliance. Understanding and addressing legal considerations from the outset safeguards the interests of all parties involved.

Best Practices for Joint Business Planning Execution

Effective execution is the linchpin of successful joint business planning. This section explores best practices that organizations can adopt to ensure the seamless implementation of collaborative strategies, including the use of performance metrics, monitoring, accountability, and value chain analysis.

1. Performance Metrics and KPIs

Setting and monitoring performance metrics are essential elements of joint business planning execution. This subsection delves into the process of defining key performance indicators (KPIs) that align with the shared objectives of the collaborative venture. 

By establishing measurable benchmarks, organizations can gauge the success of their efforts and make informed decisions to optimize performance.

Performance metrics should not be static; instead, they should be subject to continuous evaluation. This subsection emphasizes the importance of regularly assessing KPIs, analyzing performance data, and adapting strategies based on the evolving needs of the collaboration. 

A dynamic approach to performance measurement ensures that joint business plans remain responsive to changing market conditions.

2. Monitoring and Accountability

Effective monitoring is a cornerstone of successful joint business planning execution. This subsection explores proactive monitoring strategies, including the use of technology, regular communication channels, and real-time data analysis. 

By staying vigilant and responsive, organizations can identify potential issues early on and take corrective actions to maintain the trajectory toward shared goals.

Clear accountability structures are vital for the success of collaborative ventures. This subsection delves into the importance of defining roles, responsibilities, and expectations within the partnership. 

Establishing accountability structures fosters a sense of ownership among all stakeholders, ensuring that each party contributes actively to the joint business plan’s execution.

3. Value Chain Analysis and Multi-functional Execution

Conducting a value chain analysis is a best practice that can significantly enhance joint business planning execution. This subsection explores how organizations can identify value-creation opportunities at each stage of the collaboration. 

By optimizing the value chain, partners can streamline processes, reduce costs, and deliver enhanced value to customers.

Collaborative ventures often involve the integration of multiple functions within each organization. This subsection discusses the importance of multi-functional execution, emphasizing the need for seamless coordination across departments. 

By breaking down silos and promoting cross-functional collaboration, organizations can ensure the holistic implementation of joint business plans.

Creating Value Through Customer Focus

In today’s customer-centric business landscape, creating value for consumers is at the forefront of successful joint business planning. 

This section explores strategies for placing customers at the center of collaborative efforts, enhancing consumer sales, and elevating the overall customer experience.

How to Create Value for Customers Through Joint Business Planning

A fundamental step in creating value through joint business planning is gaining a deep understanding of customer needs and preferences. This subsection explores how organizations can leverage market insights, customer feedback, and data analytics to identify and prioritize customer-centric initiatives. 

By aligning collaborative strategies with customer expectations, businesses can create offerings that resonate with their target audience.

Effective joint business planning involves co-creating solutions that address specific customer pain points. This subsection emphasizes the importance of collaboration in ideation and product development, showcasing how partnerships can bring together diverse perspectives and expertise to deliver innovative solutions. 

Co-created offerings not only meet customer needs but also differentiate the collaborative venture in the market.

Consumer Sales and Customer Experience

Joint business planning can significantly impact consumer sales by optimizing distribution channels, expanding market reach, and aligning sales strategies. This subsection explores how organizations can leverage their collaborative efforts to boost consumer sales. Whether through joint marketing initiatives, bundled offerings, or cross-promotions, aligning sales strategies enhances the overall success of the partnership.

Customer experience is a critical differentiator in today’s competitive market. This subsection delves into how joint business planning can be structured to elevate the customer experience. 

From seamless transactions to personalized interactions, collaborative ventures can enhance every touchpoint in the customer journey. Focusing on customer satisfaction not only builds loyalty but also contributes to the long-term success of the collaborative partnership.

In conclusion, the journey through the intricacies of joint business planning best practices has highlighted the pivotal role that effective collaboration plays in today’s dynamic business environment. 

From aligning business strategies and setting joint objectives to executing plans with a customer-centric focus, the success of collaborative ventures hinges on a thoughtful and strategic approach.

Frequently Asked Questions (FAQs)

What are the key metrics to measure the success of a joint business plan.

Measuring the success of a Joint Business Plan involves tracking key metrics such as revenue growth, market share expansion, customer satisfaction, cost savings, return on investment (ROI), and adherence to compliance and risk mitigation. 

These metrics provide a comprehensive evaluation of the collaborative venture’s impact on both financial and operational aspects, ensuring a holistic assessment of the plan’s effectiveness.

How do you resolve conflicts during the Joint Business Planning process?

Resolving conflicts during the Joint Business Planning process requires an open communication approach, identification of root causes, and, when needed, the involvement of a neutral third party for mediation. 

A clear definition of roles and responsibilities, the establishment of conflict resolution protocols within the joint business plan, and a focus on shared objectives contribute to addressing conflicts promptly and fostering a collaborative environment.

What role do executive sales leaders play in Joint Business Planning?

Executive sales leaders play a pivotal role in Joint Business Planning by strategically aligning sales efforts with overall business goals, contributing to resource allocation discussions, cultivating relationships with key stakeholders, providing market insights, and overseeing the performance of sales teams. 

Their involvement ensures that sales strategies complement the collaborative venture’s objectives, driving success in terms of revenue and market impact.

How often should a Joint Business Plan be reviewed and updated?

The frequency of reviewing and updating a Joint Business Plan varies but commonly involves quarterly reviews for timely adjustments based on market changes and annual updates for comprehensive reassessment of long-term goals. Additionally, trigger events such as major market shifts or significant internal changes may prompt unscheduled reviews. 

Adapting the frequency based on the dynamic nature of the business environment ensures the plan remains relevant and responsive to evolving conditions.

Are there any software tools that can facilitate Joint Business Planning?

Various software tools facilitate Joint Business Planning, offering features such as collaboration, data analysis, project management, and document sharing. Platforms like Microsoft Teams, Slack, or Asana enhance communication, while tools such as Tableau or Power BI aid in data analysis.   Project management software like Trello or Jira helps in planning and tracking progress, and CRM systems like Salesforce or HubSpot centralize customer interactions and sales activities. The selection of tools depends on the specific needs and preferences of the collaborating organizations.

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Taking supplier collaboration to the next level

Companies with advanced procurement functions know that there are limits to the value they can generate by focusing purely on the price of the products and services they buy. These organizations understand that when buyers and suppliers are willing and able to cooperate, they can often find ways to unlock significant new sources of value that benefit them both.

Buyers and suppliers can work together to develop innovative new products, for example, boosting revenues and profits for both parties. They can take an integrated approach to supply-chain optimization, redesigning their processes together to reduce waste and redundant effort, or jointly purchasing raw materials. Or they can collaborate in forecasting, planning, and capacity management—thereby improving service levels, mitigating risks, and strengthening the combined supply chain.

Earlier work has shown that supplier collaboration really does move the needle for companies that do it well. In one McKinsey survey of more than 100 large organizations in multiple sectors, companies that regularly collaborated with suppliers demonstrated higher growth, lower operating costs, and greater profitability than their industry peers (Exhibit 1).

Despite the value at stake, however, the benefits of supplier collaboration have proved difficult to access. While many companies can point to individual examples of successful collaborations with suppliers, executives often tell us that they have struggled to integrate the approach into their overall procurement and supply-chain strategies.

Barriers to collaboration

Several factors make supplier collaboration challenging. Projects may require significant time and management effort before they generate value, leading companies to prioritize simpler, faster initiatives, even if they are worth less. Collaboration requires a change in mind-sets among buyers and suppliers, who may be used to more transactional or even adversarial relationships. And most collaborative efforts need intensive, cross-functional involvement from both sides, a marked change to the normal working methods at many companies. This change from a cost-based to a value-based way of thinking requires a paradigm shift that is often difficult to come by.

The actual value generated by collaborating can also be difficult to quantify, especially when companies are also pursuing more conventional procurement and supply-chain improvement strategies with the same suppliers, or when they are simultaneously updating product designs and production processes. And even when companies have the will to pursue greater levels of supplier collaboration, leaders often admit that they don’t have the skill, lacking the structures they need to design great supplier-collaboration programs, and being short of staff with the capabilities to run them. After all, what great supplier collaboration necessitates is much more than the mere application of a process or framework—it requires the buy-in and long-term commitment of leaders and decision makers.

A shared perspective

To understand more about the factors that hamper or enable supplier-collaboration programs, we partnered with Michigan State University (MSU) to develop a new way of looking at companies’ use of supplier collaboration. The Supplier Collaboration Index (SCI) is a survey- and interview-based benchmarking tool that assesses supplier-collaboration programs over five major dimensions (Exhibit 2).

During 2019, researchers from McKinsey and MSU rolled out the Index in a pilot project involving a dozen leading consumer-goods companies in North America, along with ten to 15 of each company’s strategic suppliers. We collected more than 300 written responses from more than 130 organizations, and conducted in-depth interviews with around 60 buyer and supplier executives. The work provides some important insights on the state of supplier collaboration today, revealing the elements of collaboration that companies and suppliers believe are working well, and the areas that present the greatest challenges.

The results of our consumer-industry benchmark are summarized in Exhibit 3, with average buyer and supplier perceptions of their own collaboration programs rated from one (low) to ten (high) in each of the five dimensions.

Overall, the research reveals close alignment between buyers and suppliers on the relative strength of most dimensions. It also shows a clear drop in perceptions of strength as the discussion moves from theory (strategic alignment) to execution (value creation and sharing, organizational governance).

The in-depth interviews conducted with senior buyer and supplier personnel as part of the SCI data-collection process provide further insights into the challenges companies face in each of the five dimensions, while also revealing some examples of best practices that lower-performing companies can emulate.

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Achieving strategic alignment.

Benchmark participants understood who their strategic suppliers are, although they do not all use formal segmentation approaches to categorize their supply bases. Likewise, suppliers understood their strategic importance to their customers. Buyers and suppliers agreed that there was good alignment on the pursuit of sources of value beyond cost—but also agreed that their efforts to capture these value sources were not always successful.

The first step for an organization is to define what it wants to achieve from its collaboration efforts, and what it needs to do to realize those goals. Internal alignment and commitment by senior managers to ensure appropriate resources are available is also critical. For example, in a quest to develop more sustainable detergents, Unilever partnered with Novozyme—a major supplier of enzymes— to jointly develop new enzyme solutions. The collaboration leveraged each party’s strengths, merging Unilever’s understanding of which types of stains and materials were most relevant with Novozyme’s reagent-optimization capabilities. The partnership resulted in two enzyme innovations that improved product performance, increased market penetration, and allowed the company to target premium-branded competitors. Moreover, the new formulation performed well at lower temperatures, helping customers save energy and reduce CO2 emissions.

Joint business planning

Joint business planning is a collaborative planning process in which the company and its supplier align on short- and long-term business objectives, agree on mutual targets, and jointly develop plans to achieve set objectives (exhibit). It brings a formal approach to collaboration with suppliers and helps to engage stakeholders from different functions in the collaboration effort.

Joint business planning works best when companies have a clear understanding of the strategic suppliers with which they want to engage, and where they have strong core supplier management capabilities in place. The approach can be applied at several levels. At its simplest, joint planning can involve aligning on metrics and value sharing agreements. At its most advanced it can include joint investment to create new sources of value.

Other organizations participating in SCI have introduced formal methods to promote greater strategic alignment, such as by introducing a joint business-planning approach. The buyer and supplier align on short- and long-term business objectives, set out mutual targets, and jointly develop plans to achieve objectives. Areas of opportunity for collaboration include growth, innovation, productivity, quality, and margins (see sidebar, “Joint business planning”).

Communication and trust

Buyers and sellers both describe high levels of trust in relationships that they consider strategic. In most cases, that trust has been built up over time, based on longstanding business relationships. Companies involved in collaborations tend to appreciate each other’s capabilities, understand each other’s businesses, and believe that their partners will stick to the commitments they make.

Companies are less convinced, however, that their partners will be ready to put the interests of the collaboration above the interests of their own organization. Many interview participants noted that greater transparency over sensitive areas such as costs was key to attaining the highest level of collaboration, but said that this goal was often difficult to achieve.

Building trust takes time and effort. Often this means starting small, with simple collaboration efforts that deliver results quickly, building momentum. This way, companies can demonstrate a serious approach to collaboration and their willingness to share gains fairly. More importantly, companies should base their relationships on transparency and information sharing as a foundation, with the expectation that greater trust will follow.

Cosmetics company L’Oréal follows this approach to encourage collaborative innovation. Through open dialogs concerning company goals and long-term commitment, L’Oréal has been able to establish an effective codevelopment process. The company’s annual “Cherry Pack” exhibition, for example, offers suppliers a preview of the consumer trends that the company will be working on, and asks them to develop packaging solutions in harmony with these trends. During the exhibition, L’Oréal creates a trust-based forum for suppliers to present the ideas and products in development—including ideas that have yet to be patented. The forum thus gives suppliers access to practical short- and long-term ideas and projects that ultimately accelerate packaging innovation.

Cross-functional engagement

To generate value from changes in manufacturing methods, quality-assurance regimes, or supply-chain processes, representatives from the respective functions on both sides of the partnership will need to work together. Yet this type of cross-functional engagement is something most benchmark participants find extremely difficult. Executives reported that while traditional relationships—such as those between buyers and supplier sales teams, or suppliers and buyer R&D functions—were strong, wider cross-functional engagement was patchy and poorly managed at best.

Improving cross-functional engagement is a leadership issue. Organizations with the most successful collaboration programs use a formal approach to manage cross-functional teams, with clearly defined roles and responsibilities on both sides of the partnership, backed by changes to internal incentive systems to promote full participation in collaboration projects.

Some companies, such as P&G, have taken a step further in creating cross-functional teams solely focused on joint innovation with suppliers. By creating a practice of “open innovation,” P&G aimed to coordinate its efforts and leverage the skills and interests of people throughout the company to assess the competitive landscape, identify types of innovation that can help develop disruptive ideas, and identify appropriate external partners. For innovation to work, P&G has stressed the need to integrate cross-functional teams that, in turn, integrate business strategy with operations—which requires a broad network of interactions.

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Value creation and sharing.

The pursuit of shared value is the reason buyers and suppliers take part in collaboration projects, so unsurprisingly procurement executives consider it the most important dimension of their collaboration efforts. Yet few participants in our study track the impact of collaboration on sources of value beyond cost reductions. Where companies have tracked the impact of collaboration projects on revenues, margins, or other metrics, they have done so only for a handful of high-profile projects.

For buyers, additional volume remains the most common way that the extra value created by collaboration projects is shared. Some partnerships had made use of other types of value sharing, such as performance-based incentives for suppliers. Where these approaches were employed, both buyers and suppliers were happy with the results. That suggests significant opportunity for companies to expand their use of such approaches, provided they can reach agreement on cost baselines and incentive structures.

Cleansheet cost modeling

Many of the potential sources of value targeted by supplier-collaboration efforts depend upon a mutual understanding of the true costs of a product or service. Achieving that sort of transparency can, however, be difficult in buyer-supplier relationships. Suppliers may be reluctant to reveal too much about their own manufacturing processes and costs, fearing that this information will be used against them in negotiations, and buyers may not want to let suppliers know just how critical they are.

Cleansheet cost-modeling approaches have risen to prominence in recent years as a tool to allow an open, fact-based cost discussion between buyers and suppliers. A cleansheet calculates the cost of each step during the creation of a product, component, or service, using a database of information on the materials, labor, factory space, equipment, time, and energy required to complete each step—and the implications for the desired product volumes on the utilization of those resources.

Cleansheet cost transparency helps collaboration partners generate ideas for design and process improvements. The approach can also underpin value-sharing agreements, allowing organizations to establish clear cost baselines and measure improvements against them.

Cost transparency is a critical enabler here. Some companies have found cleansheet cost modeling to be a very effective way to conduct fact-based discussions on costs and improvement opportunities with their collaboration partners (see sidebar, “Cleansheet cost modeling”).

ASML, a lithography-equipment manufacturer for the semiconductor industry, operates a value-sharing mechanism for its suppliers. The company allows suppliers to maintain healthy margins (as a volatility buffer), provides financing for the infrastructure needed to make its products, and offers staggered purchase guarantees. In this way, ASML incentivizes and rewards its strategic suppliers for prioritizing its business, gains access to cutting-edge technology, and reduces costs and improves stability in an industry with short lifecycles affected by substantial swings in demand.

Throughout its long history of collaboration with suppliers, P&G has used a wide range of commercial models to partner with suppliers across the entire R&D chain. Its value-sharing models range from shared fund pools for codevelopment of products to licensing agreements for commercialization. The flexibility to employ different mechanisms has allowed P&G to tap into supplier innovation without the need to overinvest in the development of deep partnerships with every potential collaborator.

Organization and governance

Like cross-functional engagement, the organization and governance of supplier-collaboration programs suffers from a lack of formal structures and processes. Interviewees admitted that their companies, both buyers and suppliers, were relatively lax in tracking and valuing their supplier-collaboration efforts. Few organizations had done anything to align the incentives of project participants within their own organizations, and most relied on informal mechanisms to share feedback or review progress with partners.

Introducing a clearer governance structure for the overall supplier-collaboration program and for individual projects has the potential to significantly improve outcomes in most organizations. Two-way scorecards, for example, allow buyers and suppliers to let each other know if they are effectively supporting the goals of the program. Governance of collaboration projects should be cross-functional, with appropriate incentives introduced throughout the organization to encourage full participation and ensure both parties pursue long-term win-win opportunities, not just short-term savings.

Supplier advisory boards

A supplier advisory board (or council) serves as a neutral and collaborative forum for the exchange of ideas between the host company and a group of strategic suppliers. Such boards are widely used by companies with mature procurement organizations, and they do so for a variety of reasons. A board may advise on key industry trends, risks, and potentially disruptive threats in the supplier ecosystem. Or they may provide a place for companies to explore the potential impact of business decisions on sourcing strategy. Some boards act as a hub for projects to improve operational processes between the company and its suppliers. Others are assembled to support special projects, such as joint innovation programs or sustainability initiatives.

An advisory board is usually chaired by an executive business sponsor and sourcing lead. Buyer-side members include representatives of multiple functions, such as marketing, legal, and R&D. On the supplier side, companies usually nominate a lead strategic supplier, along with around a dozen supplier board members chosen from the strategic supplier base. Those suppliers are selected after evaluation against a matrix of criteria determined by the objectives of the board.

Several leading organizations have created supplier advisory boards to provide high-level support and guidance for their supplier-management and supplier-collaboration programs. These boards act as a forum for the supplier base to advise on key issues and collaborate with the organization to further its business agenda. Companies use their supplier advisory boards to help manage risks and disruptive threats to the supplier ecosystem, and such boards also serve as a neutral space for the exchange of ideas between the host company and a group of strategic suppliers (see sidebar, “Supplier advisory boards”).

Toyota has been a prominent example of supplier collaboration, whose success can be explained in part by the use of clearly defined targets and supplier-performance metrics. These are built into contracts that hold suppliers accountable for continued improvements in quality, cost, and delivery performance. The company governs supplier relationships using a steering committee, staffed with relevant senior stakeholders from both organizations, to define the scope and objectives of the collaboration, review progress, and take action to remove roadblocks and resolve issues as they arise.

The Supplier Collaboration Index has already revealed several major opportunities for companies seeking to expand and improve their supplier-collaboration efforts. Some of those opportunities are quite straightforward, such as more proactive management of cross-functional teams involved in collaboration projects, or the introduction of formal governance systems to manage those projects. Others, such as greater cost transparency between buyers and suppliers, or the use of performance-based supplier-incentive mechanisms, may require more time and effort to achieve.

Excelling at supplier collaboration requires a more active and engaged working relationship with suppliers. It also calls for a change in mindset, encouraging both buyers and suppliers to commit to the long-term pursuit of value from their collaborative relationships. We end with eight steps that any organization can take to put its collaboration efforts on the right track.

• Start by identifying those suppliers that offer unique joint opportunities to create and retain significant value.
• Align strategically with these partners to define joint objectives and develop a compelling business case for both parties.
• Adopt a methodical and structured approach to define the scope, pace and targets for joint projects, including a clear methodology on how to measure value creation.
• Define simple, clear value-sharing mechanisms, and align incentives of the cross-functional team accordingly.
• Invest in allocating the appropriate resources and building the required infrastructure to support the program.
• Create a governance model focused on performance, implementation tracking, and hardwiring supplier collaboration into core operational processes.
• Foster a culture founded in proactive communication, transparency, consistency, and knowledge sharing, to strengthen long-term partnerships.
• Invest in building world-class organizational capabilities to ensure sustainability over time.

For any organization seeking to improve the performance of its procurement practices, supplier collaboration can no longer be considered a nice-to-have. As companies reach the limits of conventional purchasing practices, further progress will require a new approach based on close relationships, cross-functional engagement, and the shared pursuit of new value.

Agustin Gutierrez is a partner in McKinsey’s Mexico City office; Ashish Kothari is a partner in the Denver office, Carolina Mazuera is a consultant in the Miami office, and Tobias Schoenherr is the Hoagland-Metzler Endowed Professor of Purchasing and Supply Management at Michigan State University.

The authors wish to thank Juby Cherian, Pat Mitchell, and Valeria Saborio for their contributions to this article.

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How to Create an Effective Joint Business Plan

For two businesses to form a joint venture, they need a plan that outlines the nature of the business coalition. A joint business plan defines the state of the companies involved, the purpose of the joint business and the partners’ responsibilities.

A joint business plan describes all the activities that these business ventures must carry out to achieve specific goals.

The relationship between the two parties and their goals must be clearly understood. After creating the business plan, it must go through a legal review to test its legitimacy. In your business planning, you work together in a collaborative relationship toward mutually agreed terms.

Business planning for joint ventures helps the parties leverage resources, reduce costs, combine expertise and/or enter foreign markets. A well-defined joint business plan is vital for any agreement and business strategy.

What is a joint business plan?

A joint business plan is a document that defines a merger between two or more companies. It describes the purpose and responsibilities of each partner in the incorporation. You may also see it as a collaborative process of planning where a supplier and retailer agree on both long- and short-term goals, including growth, finances and shared initiatives for profitability.

The purpose of a joint business plan is to design a win-win strategy for increasing consumer sales. This plan allows the partners to build a formidable relationship with retailers for mutual support and benefits. Having agreed upon goals, both parties share insights on a common vision for better support, customer growth, enhanced process and improved sales.

Business planning depends on interested parties sharing their plans with defined mutual growth opportunities. The partners can detail and share strategic planning, growth strategy, tactics and any area of competitive advantage.

The joint business plan is created once a partnership agreement is mutually beneficial and defined. Parties would draw up, approve and sign a formal contract before the execution of the plan. This is followed by a periodic review of joint scorecards based on necessary performance metrics to fine-tune strategies.

The joint business planning process comprises every possible logistic, including human resources planning and how to reach project milestones. Resource accountability is vital to building trust. Your best tool for transparent resource use and accountability is a resource planner .

If the employees of the venture will need to go to a different location, the venture will likely have difficulty planning their tasks and locations. TimeTrack Auto-Scheduling provides joint ventures with a transparent planning tool that reduces effort and enhances error-free shift planning.

TimeTrack Auto-Scheduling

Types of joint business plans

Standard plan.

This is often referred to as the working plan. It offers an overview of the company, outlines its goals, and details when and how entrepreneurs wish to achieve the goals. Such a plan helps secure funds, investments or loans. Within the plan, you could specify how you will use investor funds and their potential profits.

What-if plan

Sometimes things don’t go as planned in business. The what-if business plan defines the various roadblocks that a company might face as it strives to achieve its business objectives. The venture is largely at the whims of external factors, including the supply chain and stock market. You need to outline a predictable scenario to let business partners know how to recover their funds.

One-page plan

While a detailed plan is vital, there are instances where you will need to provide an abridged version of your plan. This one-page business plan outlines the summary of demand, solution, model, management team and action plan.

Start-up plan

A business plan for entrepreneurs, especially those in the early stages of their business planning, will need a start-up business plan. It is designed to give potential investors the bigger picture and outline how you want to achieve your goals. It often includes an executive summary, background, product and service descriptions, market analysis, costs and financial projections.

Expansion plan

This is a business plan that’s necessary when you need to scale your business and identify the necessary resources for its development. These could be financial investment, an additional workforce, new products or raw materials. This plan will detail the business background, needed resources and how they will contribute to growth and business expansion.

Operational plan

An operational business plan revolves around near-term goals , especially those you will work towards achieving within a year. It defines the activities your venture will focus on and emphasizes the role of the workforce and budgeting in achieving the operational goals. In most situations, the heads of departments are key participants in the operational plans because of the need for approval in achieving the goals.

Strategic business plan

This is different from the others because it focuses on how departments can work together. This venture plan is more comprehensive and requires senior-level approval before implementing goals. This plan answers the questions of how to achieve goals, what resources are needed and the execution plans for achieving the goals.

Joint business planning tips

Companies that benefit from a joint business plan

A joint venture exists mainly as a contract between new cooperating partners. In forming a joint venture, each of the business partners agrees to the assets they will bring to the table and how income and expenses will be shared.

While a joint venture is a corporation between two or more entities, each of the companies, be it an individual, company, corporation or group of individuals, still has its original legal status, though not all joint ventures result in a new business entity. These companies could be sole proprietorships or partnerships, limited partnerships, corporations, limited liability companies or non-profit organizations.

Examples of a joint business plan

Perhaps you have an online venture selling high-quality products at reasonable prices, while needing to increase brand strength. Such an example of a joint business plan outlines a company overview, executive summary, product and service offerings, marketing strategy, market analysis, budget and financial planning.

A joint business plan may be designed for ventures rendering menu services such as lattes, espresso, coffee, cappuccinos, and sandwiches. The business plan outlines an executive summary and studies your competition , target market, marketing plan, ownership structure and operational plan.

A joint venture could be designed around offering services such as shipping, faxing, postal and copying to residents to conduct research , create debate space and generate ideas. This example of a business plan will include an executive summary, a vision and mission statement, goals, objectives, and measures, organizational structure, marketing analysis and a financial plan.

Top strategies for effective joint business plan

In a joint business venture, there are risks which include rising complexity, cultural diversity, high failure rates and language diversity. The strategies detailed below will benefit the venture in navigating the challenges through effective joint business planning.

Strategic plan

Strategic global planning is an effective business practice for entering a new market. It helps to identify opportunities and threats. Before beginning strategic planning, be sure that a joint venture is the right action for you. Compare the strengths and weaknesses of the partners to confirm a good match. Your strategic plan should explain why you want to collaborate with that partner and what you hope to achieve, how to monitor trends and collect good data. Some of the reasons you may wish for a new joint partner may be to enter a new market, geographic expansion, financing, etc.

The right partner

The choice of partner is crucial, but what is more important is understanding the effectiveness of partners in delivering on their promises. Do your due diligence on your partner’s attitude toward collaboration, performance and level of commitment. What about sharing the same objectives?

Effective communication for a great relationship

After your investigation, if you deem the partner fit, find mutual ground. Communication is the key to a good relationship. Make sure your partner understands the foundation of the joint venture and agreement. Ensure they agree on human resources, financial contributions and goals. To consolidate the stability of your venture, be upfront, honest and transparent about your objectives.

Clarify how, what, and where

Be clear on the vision, strategic plans and scoreboard to ensure that everyone is energized and united about the goal. Define a common working pattern. This has to include conflict management, decision-making, collaboration, problem-solving and technology strategies. Focus on win-win solutions.

Track performance

Is everyone putting in the hours and making productive headway? One way to gauge this information is by time tracking. One of the challenges for companies whose employees work in shifts and in different locations is tracking attendance. TimeTrack Attendance Tracking helps companies monitor employees’ work hours and leave days, so that managers can stay up to date on potential delays.

TimeTrack Attendance Tracking

Once you have set out the goals and vision for the new venture, establish key performance indicators, the data you want to track and the process to measure those performance metrics. This involves creating a joint scorecard for each metric against trends and competition. The targets you set must guard against possible problems the partners might encounter.

Build trust

Your best joint business strategy is to build trust and create value, without which your partnership is bound to fail. Trust is the foundation of every partnership. It is an important factor in business planning. Without it, neither partner can succeed. How do you manage diverse cultures, interests and languages if the partners lack trust? Trust builds team strength and encourages creativity while promoting collaboration.

Good leadership

The cost of poor leadership is so high that you must not venture into joint partnership without assurance of good leadership. Focus on building good leadership and not just creating “bosses”. Leadership presents the biggest opportunities to change the performance narrative. Create a strong leadership team, from whom all employees can learn.

A joint business venture is not without its challenges. To ensure a successful collaboration, focus on a clear strategy, excellent communication, transparency and strong leadership.

I am a researcher, writer, and self-published author. Over the last 9 years, I have dedicated my time to delivering unique content to startups and non-governmental organizations and have covered several topics, including wellness, technology, and entrepreneurship. I am now passionate about how time efficiency affects productivity, business performance, and profitability.

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Improve Collaboration and Joint Business Planning Results in 3 Steps

Collaboration is on many organization’s strategic plans, with effective Joint Business Planning (JBP) being the outcome. Retailers’ and Vendors’ have the opportunity to determine mutual areas of interest and build their businesses in a collaborative way — namely by taking steps to improve Shopper satisfaction with a better experience.

However, effective Collaboration and JBP require more than a desire or written strategic plan. Both require that your organization undertake 3 consecutive steps:

• Prepare your organization internally for collaboration;
• Align your internal approach across your multifunctional teams through common training; and
• Implement external Collaboration and Joint Business Planning.

Collaboration and Joint Business Planning can help both Retailers and Vendors manage the change that continues to dominate, including:

• Changing partner needs and expectations between Retailers and Vendors
• Changing market and Shopper,
• Less resources available internally due to downsizing / consolidation, and
• Increased requirements due to more and bigger data and a more complex Shopper.

Here are some resources to help you get started:

• Complimentary Download: Collaborative Relationship Continuum Model
• Course Video Preview: Collaborative Business Planning
• Course Overview:   Collaborative Business Planning

3 Steps: Improved Collaboration and Joint Business Planning 

Step 1: be prepared internally.

It’s important for teams and organizations to first understand what collaboration is: 

Collaboration is highly diversified multifunctional teams   working together inside and outside a Retailer / Vendor with the purpose to create value   by improving innovation, Shopper relationships   and efficiency while leveraging technology for effective interactions in the virtual and physical space. (Carlos Dominguez, Cisco) (modified by Sue Nicholls, CMKG)

Are you ready to collaborate?  Start by defining your assets, prioritizing your opportunities and seeking out the right business partners. The questions below can help determine if your organization is ready to collaborate ( taken from the Category Management Association’s whitepaper on “Strategic Collaboration for Shopper Satisfaction” ):

• What do you want to gain by collaborating?
• Is your company set up to foster and support collaboration?
• What multifunctional resources / data / technology / intellectual property can be shared with your collaborative business partners?

Step 2: Create Internal Alignment

Moving to a collaborative approach requires your multifunctional teams to be able to see the “bigger picture”, turn data into insights, think beyond brand into total category, and better understand the consumer AND Shopper. These responsibilities must be expanded to marketing, sales, private label and retail teams in an aligned approach. 

Alignment of all functions in your organization occurs through engagement and training in category management . In fact, training approaches need to change for most organizations, as traditional “point and click” linear approaches based on a new data source or tactic no longer suffice. In a collaborative approach, teams need to start thinking more strategically about how the decisions and recommendations they make align to the overall strategies for the organization and for their external collaborative business partners. This can be accomplished by equipping multifunctional teams with a common set of knowledge and skills acquired through training courses. 

Role-based training in combination with strategic training will help individuals and teams feel more confident they are making choices and recommendations that match with your overall collaborative efforts and Shopper.

Step 3: Move to External Collaboration and Joint Business Planning

Now that you’ve established where you are currently at with your Retailer or Vendor partners, you can undertake Joint Business Planning (JBP) — the “next level” in a collaborative relationship. JBP should build from foundations established in collaborative relationships.

In theory, Joint Business Planning is a collaborative effort between the Vendor and Retailer which involves open sharing of information. Shared information allows for the creation of a common, mutually-agreed-to business plan. But let me insert a bit of reality into this idyllic definition. From a basic level, it is a business plan that is developed between Vendors and Retailers, through sharing of select information. The plan should include expected trends, initiatives and the forecasted market environment, so that there is a greater chance for the goals and objectives within the plan to be attained. 

The higher the level of collaboration between the organizations, the closer you will move toward the theoretical definition of Joint Business Planning.

A successful Joint Business Plan requires each party to clearly understand the others’ goals, business and customer requirements. This shared understanding becomes the foundation of the JBP, with both businesses pooling their resources and expertise to achieve specific goals. The risks and rewards of the plan are also shared.

While specific approaches vary by Retailer, the following framework from CMKG category management training provides the key steps associated with most joint business planning processes:

Let’s look at the first step for the Retailer – identifying corporate strategies and goals . The Retailer, usually led by the senior management team, creates the sales, cost of goods and operating targets for the upcoming year. When you look at a Retailer’s income statement , there are 3 ways that a Retailer can influence net income:

• increased sales;
• decreased cost of goods sold; and
• decreased operating expenses.

Retailers’ targets will most likely include initiatives behind all three of these components of the income statement to increase their net margin and income. Examples of initiatives may include new store openings, the current market, and private label opportunities for the Retailer. Other initiatives may be based on supply chain upgrades, information technology upgrades, or any other types of business process improvements that will impact the bottom line for the Retailer.

In summary, if you have properly defined collaboration internally and strategically selected your business partners upfront, you are less likely to run into problems. Problems are likely to arise in a Joint Business Plan if:

• There are unclear objectives, one of the parties was not transparent in their sharing of information, or the plan was not properly communicated to everyone involved.
• The partners have different objectives or hidden agendas in the joint venture.
• One party is investing much more in terms of expertise, financial, and/or assets than the other party, creating an imbalance.
• Different cultures and management styles with partners may result in poor integration and cooperation.
• The partners don’t provide sufficient leadership and support in the early stages of the program.

The Opportunity?  For Retailers and Vendors to define mutual areas of interest, build business in a collaborative way, and improve the Shopper experience. 

Want to learn more about Collaborative and Joint Business Planning? Category Management Knowledge Group can help you, your team or your organization through a single online, live or webinar course or a customized program. We have some great category management training options available to meet your needs. You can preview our brand new, accredited  Collaborative Business Planning   course below:

Topics: Category Management , Strategic Collaboration / Joint Business Planning

Written by Sue Nicholls, Founder & President CMKG

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JBP: The Brave Approach to Writing a Joint Business Plan

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How you can take the Brave Approach to Writing a Joint Business Plan – JBP – with a UK Supermarket:

Writing a Joint Business Plan (JBP), creating Joint Business plans, JBPs, or terms negotiations, as they can be known, are all relatively new phenomena in the world of supermarkets and suppliers. Whilst some supermarkets and suppliers, particularly the brands, have talked about joint business planning for some time, it is only in the last few years that it has become ‘business as usual’. Now featured in industry news and some Joint Business Plans are published online – This JBP is for Tesco and Nestle in Poland.

The first moves towards a JBP were made when Category Management and ECR made an appearance in the 1990s with tools like the Category Scorecard. Hard-nosed buyers and sceptical account managers reluctantly dipped their toes in the water of true collaboration. Though, as Stephen Covey writes in Habit 4 win:win, the only way forward is together for mutual benefit. The definition of joint business planning is to work with a collaborative mindset towards mutual goals agreed upon for the benefit of the supermarket, supplier and shopper.

The Brave Approach to Writing a Joint Business Plan with a UK Supermarket is about helping UK supermarket suppliers to identify their true business objectives . Also, to understand what is strategic planning, identify the business terms and create a business plan that is worth having for both parties. Here are 7 brave moves that should be taken in The Brave Approach to Writing a Joint Business Plan with a UK Supermarket. This is because a supplier that does, will be best in class:

1. Stating the Blindingly Obvious – A Joint Business Plan is All About Trust

In Accenture’s free report on joint business planning, they talk of a change in mindset for both parties to achieve ‘Increased trust among parties’. And, of course, Accenture is right that trust is absolutely essential for a joint business plan to be effective. Plus, the IGD industry survey on Category Management Capability and Partnership of 2014, said that ‘Too often trust is the biggest barrier to putting any proposal into action’.

The challenge is that trust is hard to build and even harder to understand, particularly for people representing two large companies, where the aim is to make as much money as you can, usually by giving the other party less.

Discussing trust can be a sensitive topic and a brave topic to raise. Doing so provides a solid foundation to build upon. The simple choice is to either raise these issues now or to become frustrated when nothing happens. Better now because both parties are wanting to build a future together.

Action: Add ‘Building further trust’ as an early agenda point in your joint business planning meeting.

2. KISS is the Route that Succeeds Most with Joint Business Plans

KISS is a mnemonic that is often said and rarely used. In joint business planning the watch out is not to write a joint business plan together where people spend days locked away in darkened rooms solving the vision, the big category problems, discussing shopper switching, the next range review, why promotions don’t work, and the ‘kitchen sink’. The challenge and the brave approach is to work on less to achieve more.

Scoping what both parties want to achieve is essential and then identifying the 80:20 of those items. The objectives will be easily identified and usually around, ‘To write a joint business plan that delivers x growth/market share/sales by <date>’. The scope is hard. The important part because it might be just to complete a simple one-page document showing:

• Category Targets
• Category Measures
• Enabling Big Projects
• Project Milestones
• Ways of Working

This document could be just one page. But it is a bought-in, thrashed and motivating page. A page that both parties agree to start with and then review in 3 months. An 18-month plan is about the right timescale to tackle a joint business plan. There are those that will advocate 3 years and even 5-year business plans are needed. The challenge is that most supermarket buyers will not be in place beyond 18 months, and many account managers too.

Action: Agree on the scope of the joint business plan. Divide a page into two, headed up with the scope and then 2 columns; In and Out. Agree on what is in scope, e.g. Discussions that are big picture and what is out of scope, e.g. The day-to-day detail.

3. Naming the Big Project Outcomes is the Key to Success

In our Time Management Training course we talk with the learners about the importance of having a project list and describe the daily to-do list as the wheels of a car, and the project list as the steering wheel. Those without a project list fail to steer towards their KPIs and KRAs , preferring to work on the day-to-day, refusing to acknowledge the big stuff and claiming that they are ‘too busy’.

The same is true of joint business plans and the key is to define the outcome. Instead of writing ‘Promotions Project’, change it to a project outcome title, which could be ‘Promotions Adding Sales of £5m p.a.’. Whilst a subtle change, the difference is that if no traction is made the impact is obvious – £5m lost. Plus, it is less likely that the person will remove the project when the outcome is obvious, and the project owner can genuinely begin with the end in mind – £5m sales to identify.

Making traction on the big projects is essential to see early progress on joint business planning. For each big project, the collaborators need to agree on the first 3 practical and simple actions. These 3 actions will get the project moving. Even if those actions are to get together for 1 hour to brainstorm. Maybe brainstorm how to achieve £5m additional sales from promotions. It is imperative that these debates are not tackled at the Business Planning meeting. This is because it is ‘scope creep’. Which means that it is against the scope that was agreed. Plus, the meeting will achieve very little because too much is trying to be achieved.

Action: Change project titles to project outcomes and agree on the first 3 practical and simple steps for each project.

4. A Simple Dashboard Every 2 Weeks to Keep Things Moving

The experience of most people is that business plans are built with love and sit on a shelf with hate. Their examples have taught them that joint business planning is a necessary evil and ultimately achieves very little.

The brave move is to change your mindset. Get out of the self-fulfilling prophecy, by doing Joint Business Plans differently to the last 10 times. Helping to achieve that is a simple dashboard showing the Category Targets, Category Measures, Enabling Big Projects, Project Milestones, & Ways of Working and most importantly, the progress, with a short commentary. Ideally, on one page, the dashboard is published every 2 weeks. Fortnightly because 1 week is not long enough to see progress and one month is too long if progress is going off-course.

By having a dashboard the joint business plan is kept alive.

Action: Propose a simple dashboard that is to be published every 2 weeks, for the group to approve.

Free Download: JBP Template

Please contact us if you have any questions, 5. reviewing the joint business plan quarterly together.

A smaller team is a brave move. This is because, during the landing of Category Management and ECR in the 90s, the supermarket team and the supplier team would be around 12 people each.

Whilst this was more a demonstration of collaboration and ‘equalling the fight’ than anything else, progress was slow. Nowadays a smaller team can achieve more if they accept that their accountability is to get the information, persuade the other departments, and basically make progress, not being able to cite every other department in their company as the reason for not achieving the required progress.

A smaller team should meet every quarter with the only point on the agenda to discuss the joint business plan. These dates need to be diarised for the full 18 months. Again, the scope is important because the temptation will be to discuss the other 100 issues that need addressing. But bravely accepting that the joint business plan, if delivered, will achieve everyone’s goals, then this is the only topic of discussion.

Beginning with a refresh of what the joint business plan looks like, the agenda should look like this:

• Refresh the joint business plan.
• Ways of Working – Have these been adhered to? What else needs to be done?
• Performance Vs the agreed targets.
• Project progress Vs the agreed milestones.
• Discuss the usefulness of the dashboard, not being tempted to make it too onerous.
• Run through the actions stating what, who and when very clearly and emailed before everyone leaves. Our top tip is to capture actions on email as the meeting progresses. Not afterwards because each one is likely to be re-debated.
• Agree on the date of the next meeting.

Action: Propose dates for the next 18 months and a suggested agenda.

6. Strategic Thinking is the Essential Skill

In the most recent IGD trading survey both suppliers and supermarkets ranked ‘strategic alignment’ and ‘long term planning’ as important now and even more important in the future. The supermarkets said that having these skills was what a supermarket would expect from a ‘best in class’ supplier. Strategic Thinking , as well as being one of those overly used terms and mystifying skills, has now become essential to joint business planning. So much so that job advertisements are asking for applicants to have joint business planning experience. Strategic thinking, strategic planning, and having strategic objectives are about being able to see the big picture, identify insights with high impact and make them happen. The skills of joint business planning are the same, as well as an effective use of some negotiation skills.

The brave move would be to initiate a joint business plan with the supermarket and begin to implement this roadmap to category growth. Action: Read this post on strategic thinking and consider an executive coach to prepare you for your next JBP so that you are the best version of yourself when you negotiate, share your big-picture thoughts and discuss trust.

7. These Critical Meetings are ‘Must Win Meetings’ for Any Supermarket Supplier

Initiating, or being invited to a Joint Business Plan meeting, is pivotal to every supplier because, of course, terms are negotiated and the outcome will have a high impact on the supplier’s annual performance, but also a Joint Business Plan meeting is an opportunity to demonstrate ‘best in class’. Best in class for category understanding, shopper understanding, supermarket understanding, possible solutions, and how to manage these plans to make them work.

For these reasons, the preparation for a must-win meeting must be to achieve the old adage of ‘sweat in training, no need to bleed in battle’. Role plays are an undervalued tool for preparing and for getting the heads-up on those things that could not be predicted and are yet to happen. When millions of pounds can be at stake for one meeting, it pays to be prepared, and ask the experts for help to be the very best version possible.

Action: Book a role play with a suitable colleague/s so that you can sweat in training, or contact us for help. See our Fyffes testimonial for how we supported them.

A Summary of the 7 Brave Moves 

Here is a summary of the 7 brave moves that should be taken in The Brave Approach to Writing a Joint Business Plan with a UK Supermarket because a supplier that does, will be best in class:

• Stating the blindingly obvious – It’s all about trust.
• KISS is the route that succeeds most with joint business plans.
• Naming the Big Project Outcomes is the Key to Success.
• A Simple Dashboard Every 2 Weeks to Keep Things Moving.
• Reviewing the Joint Business Plan Quarterly Together.
• Strategic Thinking is the Essential Skill.
• JBP Meetings are ‘Must Win Meetings’ for Any Supermarket Supplier.

What is your top tip for writing a JBP? Please share your view by commenting at the end of this article.

Creating a JBP that Includes the Required Elements of the Groceries Code Adjudicator 

Only 1 in 2 Suppliers has a written supply agreement according to research by the Groceries Code Adjudicator (Slide 16). A written supply agreement is often a joint business plan. Therefore here is a checklist of often-forgotten items that should form part of the written supply agreement/JBP:

• Payment terms
• Marketing costs, e.g. artwork, packaging, consumer research, or hospitality
• Payments for wastage

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Ten Best Practices for Better Joint Business Planning

We recently led an alliance team through an alliance business planning session.  Through that process we captured a number of best practices that lead to better business planning and ultimately better performing alliances.  Here is what we learned:

•  Develop the business plan with your partner.  Successful alliances are win/win/win . Your partners’ strategic objectives, resources, commitment and creative insight are critical to the process and to a successful outcome for you, your partner, and your joint customers.
• Use the templates and checklists as stimuli for thought not a rigid formula.  Your alliance is unique. The value creation thought process and business plan should reflect that.
• Build from the specific to the general.   You may find that over several initiatives you have 80% commonality, but it is that 20% differential that makes for a successful joint offer.  Specifics make an impact – generalizations put you to sleep.
• Articulate the differentiation in the solution clearly, unambiguously. Contrast with the competition…50% more scalable than .
• Individual value propositions should include specific descriptions of how value is created, so that a reader not in the alliance understands it. You will be describing the value of this alliance to executive management and other stakeholders.
• Include customer value and metrics .Hard metrics on customer value ie. “reduces deployment costs by 7%”, gives you a compelling reason to get in the door with customer decision makers and energizes the sales teams to engage collaboratively.  Value props that impact customer business model are especially compelling i.e. increased competitive advantage for your customer. Focusing on your customer maintains common vision between partners.
• Keep focus on specifics: – “saving millions per drill head” is a more powerful vision than ‘saving costs’; “ saving up to $5M per well” even better! Same for alliance objectives, again, the best have very clear, numerically stated objectives for both partners and customer.
• For each metric establish a baseline “where you are today” and a goal “where you want to be in 6 mo, 1 yr”
• Identify risks and obstacles to success and include risk mitigation and contingency plans
• Evaluate your sales and marketing value props from the sales perspective.  Are they strong enough to compel you sales teams to want to sell with a partner?
• Bonus Best Practice: Relationship strength is critical in an alliance.  Measure it regularly via partner health checks and proactively manage the relationship.

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JOINT BUSINESS PLAN: Top 7 Secrets To Successful Joint Business Planning&

• by Kenechukwu Muoghalu
• August 14, 2023
• No comments
• 8 minute read

Table of Contents Hide

What is joint business planning, what are the benefits of a joint business planning, what is a joint business plan , #1. have a plan, #2. choose the right joint venture partner , #3. communication, #4. define the where, what, and how, #5. monitor performance, #6. build trust, #1. how ready are you, #2. choose the right partner, #3. source business together, #4. ending a joint business planning, what if i lack the skills to create a joint business plan for myself, joint business plan faqs, what should be in a joint business plan, how do i set up a joint venture in the uk, how do you split profits in a joint business.

If you have plans to join a joint business, you have to understand the ethics of this venture before you proceed. You will need to set the right objectives for the business partnership. You will also need to have a joint business plan stipulated just for this course. There are a lot of processes, but not to worry. This article has exclusively explained what a joint business plan is and how it can help your investment, coupled with a sample template that can help make your journey easier. Let’s dig in!

Joint business planning is a collective effort between a vendor and a retailer. In this form of business, the two parties will be involved in the open sharing of information. However, it allows the joint parties to reach common ground and mutually agree on the business plan. I will give it a simpler definition, I need you to understand the basics of this Joint business planning. 

A joint business plan can also be said to be an agreement between two or more businesses in order to pool their resources to achieve a goal. It’s just like two or more people running a business. A joint partnership can be initiated in any business. A sample of this can even be found in jointly owning a personal trainer business and turning it into a joint business. 

They also share the risks and rewards of the investment. The joint companies also collectively own equal shares and put their heads together to make their investment successful. They work with trends, initiatives, and forecasted market environments. 

People can choose to open a joint venture for multiple reasons. It can be due to a business expansion, a new product development, or moving into new markets, especially internationally. Or just practicing the adage that says “two heads are better than one”. 

However, it can be difficult to build the right relationship that can boost the venture. But with the right resources, which includes having a joint business plan to serve as a guide, you would scale through. You should also know that Joint business planning with partners has proven to be one of the most effective ways to drive revenue and establish joint accountability.

Having talked about what a joint business venture is, now we will talk about having a plan that will serve as a guide through your investment. A joint business plan is a document that outlines a business coalition of two or more companies. This joint business plan is divided into several sections which state the companies involved, their purpose, and their responsibilities in the business. 

In summary, you can say that the plan contains temporary activities that can help achieve specific goals. What a proper joint business plan requires is to incorporate each party and make sure they clearly understand themselves and their goals. After the plan is been created, it will need to pass through a legal review just to test its legitimacy. 

Read Also: JOINT LOAN: Definition And All You Need To Know

Mind you, this joint business plan is above and beyond a standard business plan . It can also help you plan some measurable objectives, execution tactics, go-to-market, target account lists, and more. This business plan can serve you well, especially when it is for a joint business. Keeping track of all your business activities is a must because other people are involved in the investment. You can try checking your partner’s progress once in a while against the agreed plan.

Top 7 Secrets To a Successful Joint Business Planning

When it comes to joint business planning, there are secret tweaks that can help you scale through. You know Joint business comes with risks because of its joint partnership nature. Partnership most times can be diverse language, increased complexity, diverse cultures, and frequency of failure.

That is why we have formulated the top 7 secrets to having a successful partnership. Let’s take a quick rundown on them.

It always pays off to have a strategic plan on standby in your joint business. Your joint partnership should kick off with careful planning. To aim this, review your business strategy to see if a joint venture is even the best way to plan and achieve it. Consider the businesses involved, and compare their strengths and weaknesses to determine if it is a good match. Your strategic plan has to also answer why you want to partner with what you need to achieve from it. Is it for geographic expansion, new markets, or funding? Being clear will make the parties involved work towards achieving their objectives. 

Before going ahead to choose a partner, it is wise to determine how well they perform. Find out their attitude to collaboration and their level of commitment. Find out if you share the same business objectives with them, are the people you could trust? Do they have a nice reputation? These questions are necessary to determine who you are going into business with. Do your due diligence checks and don’t spend time having lunches with them. 

After your little investigation work on your partners, and hold a common ground with them if they fit. Communication can help build a relationship. Ensure that your partners understand what the basics of a Joint Business agreement really are. Are they clear on the goals, human resources, and financial contributions? This is the time to meet them, have those one-on-one meetings with them, communicate and make the best out of it. If you fail to plan like this, your joint business won’t be stable.

Create ways of working to energize and unite the partners involved. Map out the vision, strategic plans, and the scoreboard to make sure that everyone is following a common goal. Provide a common working pattern that includes decision-making, problem-solving, conflict management, collaboration, and technology. Find a way to deal with problems that occur, and look for win-win solutions instead of trying to score points off each other. 

When your partners have reached common ground on what the goal is, then let the work begin. You and your partners should also establish a clear performance indicator that allows you to measure your performance towards the goal. You should also set targets so that you can keep track of any possible problems that might occur. 

To be honest, this is the most crucial step in these secrets. You should understand that without trust, your Joint partnership will fail. There is no need to paint the truth to make it appear nice. Every team needs trust amongst themselves. Imagine having companies merging together, having diverse cultures, languages, and interests without trust. How do you think that ship will sail? When you have trust in someone, their differences turn into strengths. You will also tend to encourage creative challenges just to promote collaboration. This is an important factor that should not be ignored in your joint business planning.

This is another important variable that needs to exist in a Joint partnership because, without it, things will fail to happen. Invest in leadership, don’t focus on the senior leader, because even those leaders at the pointy ends will do just great. The reason for this action is that leaders tend to be the biggest opportunity to shift performance. You need to have a strong leadership team. And they must trust each other, connect, listen, and engage like no other. 

Joint Business Plan Template Checklist

To summarise all that is been said in this article, we have also included a sample template checklist that can help you prepare for and plan a successful Joint business. To make use of this joint business plan sample template effectively, you have to make sure that you follow all the options listed below. They include:

This is a joint business plan template you need to check off your list. Determine how ready you are, is your business also ready for the change? You can determine this by researching on the activities of other businesses. You can also carry out a SWOT analysis of your business. Compare your working methods with that of your partners and also involve your employees, tell them about your new plan.

This is been mentioned again for those at the back. It is crucial to choose the right partner. When choosing you should consider their existing customers and suppliers, their behavioral patterns, and also the available finances of the partners. 

Know the capabilities of your partners, and discover which has a specified responsibility. It can be sales activities, marketing, or new business generation. Each company should understand what they should work for and see that they achieve it. 

Most times, we should consider all possible factors because of the fear of the unknown. Your agreement with your partners should make provisions for terminating the joint partnership. In your agreement, make sure to include an exit strategy , specified ownership of assets in the business, and distribution of any weaknesses resulting from the joint venture. 

We got you, just right in time. We understand where it pains the most and we also understand why you would have so much difficulty creating a joint business plan for yourself even with the provision of a sample template. If this is you, then you need not worry.

Creating a business plan from scratch is no child’s play. It can even be harder while trying to use an existing plan to mold yours. You don’t have to if you don’t want to, because we have created a ready-made joint business plan just for your comfort.

This business plan does not require you to spend most of your day trying to figure out one section or the other. All you need to do is to apply directly to your joint business and watch it blossom. No long talks! Grab a copy of your joint business plan here !

It is certain that having Joint business planning can be difficult and challenging with tons of risks to take. But there is always a way around every hard obstacle. If you carry your Joint partnership and nurture it in the right way while following all the rules that apply, then you won’t have a problem.

These rules can be either creating a Joint Business plan or following some basic factors that can help maneuver your way through the investment or even using a sample template. When you follow the rules and secrets that guide them, then your investment won’t be the same. If it gets too hard, then contact us here.

To acquire a successful joint business plan, you need to ensure that both parties involved are capable of understanding each other’s goals. They should also understand the nature of their business and customer requirements. When they are on a mutual level, their foundation becomes strong.

To set up your joint business in the United Kingdom you will need to check the exact legal status of the new business. You can also begin due diligence on your joint partners. Know the financial commitment and how profits can be earned.

Before splitting the profits in a joint business, you must ensure that all business partners are in agreement about the profit-sharing. It can be split equally or on a different base according to the original agreement.

Related Articles

• SETTING UP A PARTNERSHIP: How to Start a Business Partnership In simple Steps
• JOINT MORTGAGE: Simple Guide To The Processes
• JOINT LIFE INSURANCE: Guide to Life Insurance Plan

Kenechukwu Muoghalu

Kenny, an accomplished business writer with a decade of experience, excels in translating intricate industry insights into engaging articles. Her passion revolves around distilling the latest trends, offering actionable advice, and nurturing a comprehensive understanding of the business landscape. With a proven track record of delivering insightful content, Kenny is dedicated to empowering her readers with the knowledge needed to thrive in the dynamic and ever-evolving world of business.

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The Importance Of Joint Business Planning

• verdeassociates
• Thought Leadership
• Tags: accelerating growth , B2B , commercial processes , cooperation , joint business planning , process improvement

At Verde, we understand the impact of successful collaboration between B2B partners on business growth.

The key to success is creating a joint vision that is grounded in marketplace realities, coupled with flawless execution.  To solidify this success and identify course-correction options, partners should develop progress measurement tools and processes.  We want to share with you results of work to benchmark and improve Joint Business Planning (JBP) for the Electrical industry. (Spoiler: the process is not working as well as it should, but we know how to fix it). We will be rolling out new process between a major manufacturer and distributor later this fall.  Stay tuned as we will share improvement results with you!

To find the full version of the article please visit the Electrical Trends website by clicking  here.

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• Best Practice Joint Business Planning

Joint Business Planning is mission critical for today’s consumer products retailers and suppliers. The consumer products and retailing industry is very competitive and companies are seeking advantage. Companies with a well-defined JBP process are able to formulate win-win plans and execute more effectively and efficiently by focusing their resources to areas of highest returns.

Joint Value Creation

• Best Practice JBP Pilots

TPG’s multi-functional Joint Business Planning Program helps manufacturers and retailers transform the relationship, the value chain and business results through aligned strategies and a collaborative execution plan. The key inputs for success are:

• Shared insights to develop strategies and initiatives
• Dedicated cross-functional resources
• Joint investment to drive demand or reduce cost
• Assessment: Help Suppliers understand their gaps versus JBP Best Practices
• JBP Process/Template/Tool Development: Using our Best Practice methodology, help develop the “Supplier Way” of JBP along with the templates/tools needed to activate
• JBP Training: Help train the entire multi-functional organization on the new way of working
• Facilitation: Help facilitate the JBP process with key Retail Partners, including the development of the JBP Materials needed by the Supplier as well as the facilitation of the actual Retailer meetings and follow up
• Shopper Understanding: Assess the current Shopper Insights and help develop improvements to the insights that help drive JBP Plan development and activation
• 3 Year and Annual Plan: Help develop the long range strategic plan and the 12 month plan of activation
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• Execute: Design and implement a multi-functional execution and monitoring process that is fully integrated across functions, work streams and companies, including joint KPI’s and balanced Scorecard. Identify issues and take corrective action as needed

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Biden administration seeks to close the 'gun show loophole' to buy firearms

WASHINGTON — In what could be the biggest expansion of federal background checks in decades, the Biden administration is moving to end the controversial “gun-show loophole.”

“This single gap in our federal background check system has caused unimaginable pain and suffering,” said Vice President Kamala Harris in a call with reporters.

On Thursday, the Justice Department will submit a new 466-page regulation to the Federal Register outlining that the Bureau of Alcohol, Tobacco, Firearms and Explosives will require anyone “engaged in the business” of selling guns at a profit to register as a federally licensed firearms dealer and run background criminal and mental health checks on buyers.

The new rules would cover those selling guns not only at gun shows, but also at flea markets and online. In addition, the definition of being "engaged in the business" has been expanded to include those who sell small numbers of firearms. However, exceptions will be maintained for those selling private collections and family heirlooms.

The Justice Department says the new regulation will affect more than 23,000 unlicensed dealers and tens of thousands of gun sales every year.

Republican Sens. John Cornyn, of Texas, and Thom Tillis, of North Carolina, plan to introduce a joint resolution disapproving of the changes.

Attorney General Merrick Garland said of the change in a statement, "Under this regulation, it will not matter if guns are sold on the internet, at a gun show, or at a brick-and-mortar store: if you sell guns predominantly to earn a profit, you must be licensed, and you must conduct background checks."

He called the regulation "a historic step in the Justice Department's fight against gun violence."

In a video posted Thursday on X, President Joe Biden said: “Congress needs to finish the job and pass universal background check legislation now.”

ATF Director Steven Dettelbach said the change is set to take effect in a month. It is likely to face legal challenges, though the administration argues it will hold up in court by using a provision of the sweeping gun control law Congress passed in 2022.

“This final rule does not infringe on anyone’s Second Amendment rights and it will not negatively impact the many law abiding licensed firearms dealers in our nation,” Dettelbach said.

The rule will go into effect 30 days after it is published in the Federal Register.

Advocates have been intensifying calls for the move since the 2022 mass school shooting in Uvalde, Texas, and it comes as the Biden campaign seeks to highlight the administration’s efforts to reduce gun violence. Last month, Harris visited Parkland, Florida, and met families whose loved ones were murdered during the 2018 mass shooting there. In December, the vice president also brought together nearly 100 state legislators from 39 states to launch an initiative that would provide states with additional tools to advance gun safety measures. In September, Biden established the first-ever White House Office of Gun Violence Prevention.

“This is maybe the most impactful change made possible by the 2022 gun safety bill,” said Sen. Chris Murphy, D-Conn., who has been outspoken about the issue since the 2012 shooting at Sandy Hook Elementary.

Gabe Gutierrez is a senior White House correspondent for NBC News.

Diana Paulsen is a desk assistant for NBC News.