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International Joint Ventures: Making It Work Long Distance

When it comes to international expansion, a joint venture with a pre-existing company operating abroad can be a faster and more efficient route than going it alone. This type of partnership offers many advantages as your international partner will already have knowledge of the market you’re expanding into, pre-existing contacts and relationships and many other resources that would otherwise take years to develop. However, working with an existing company means they will already have their own way of doing things, which may differ to yours. Add to this the difficulty of being thousands of miles apart and relationships can quickly become strained.

So what’s the secret to setting up and maintaining a successful international joint venture? To answer this question, we will use the example of http://www.airblastafc.com – a joint venture between UK-based Airblast Eurospray and California-based AFC Finishing Systems – and the methods they use to maintain a successful working relationship over a great distance.

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1. Common ground

In the early stages it is important to agree what your main objectives will be. If they differ, then the partnership will never work because you will constantly be pulling in different directions and will end up making major compromises that will ultimately benefit no one. When Airblast Eurospray and AFC Finishing Systems first made contact they both had a single goal in mind – to get Airblast products into the North American Market. By agreeing to work towards a common goal they ensured that both parties would always be striving to achieve the same thing, even if there were discrepancies along the way.

2. Stay in touch

The key to any good relationship is communication. With international partnerships this is even more important and keeping your business partners in the loop can be simpler than you might think. The idea of organising a mass telephone conference every day is unsustainable – people have busy schedules and if you have a time difference then the window of opportunity is very small. Airblast and AFC, who have an 8hr time difference to compete with, have overcome this problem by simply copying each other in on any emails that relate to the joint venture. This way everyone is kept up to date without having to have a major discussion about every little decision. Of course, it is important to organise more in-depth conversations and it’s a good idea to schedule telephone conferences from time-to-time to ensure that everyone is still on the same page.

3. Dealing with conflict

It’s important to realise that each company has something the other doesn’t – if this wasn’t the case then there would be no need for a joint venture in the first place. When they met, Airblast and AFC were both well established companies with plenty of experience and tried and tested ways of doing things. However, both were prepared to concede that the other had resources and expertise in an area they did not. By working collaboratively, Airblast would benefit from having a well-established distributor in the North American market, while AFC would be able to offer industry-renowned surface preparation equipment to complement their existing range of surface finishing products. Clearly defining what each company has to offer and where their expertise lays early on can help to prevent conflicts. In the areas where your knowledge is lacking, you should defer to your partner for guidance and encourage them to do the same with you, thereby cultivating a mutual appreciation for each other’s expertise and ideas.

The Result

These simple steps will ensure your joint venture has a solid foundation from which to grow. Of course, there will be disputes and complications along the way, but these will be much easier to overcome when you are communicating effectively and working towards a common goal.

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