I’ve been approached by my clients requesting a joint business plan to join two products or companies. Most of the time, these companies belonged to the same person. This made the process easier, but at the same time, it was a little confusing.
You see, a business plan is usually a story being told. It’s easy to explain a story from one point of view. However, when there are several viewpoints, sometimes the readers get lost. It’s like Game of Thrones. You need to take your time watching it. You can’t just skip to season five.
Similarly, you can’t skip any single page while reading a joint company business plan. But let me go a step forward to tell you that many joint business plans are sometimes not the best option. Let me share with you my experiences and advice in detail.
Should You Create A Joint Business Plan?
Let me just say who I am before moving on.
I’m AL Anany, a business consultant in Zurich, Switzerland. I’ve been working with clients for over ten years. Some of those clients raised over $120 million, while others were starting off a project from ideation.
Scenarios where you need a joint business plan.
Now you know me. As mentioned before, I’ve had many clients approach me for this request. I usually engage in a further discussion with them to know whether a joint business plan is the best idea for the eventual reader of this plan. Let’s discuss scenarios.
You Need a Joint Business Plan to Sell Your Business.
If that’s the case, then you’re thinking of combining multiple companies that have different products under one corporation for selling them. For that, you need to be careful about how you’re going to pitch this. Don’t get me wrong. If you need to sell your corporation, then you need a joint business plan. There’s no debate there.
But don’t confuse the reader by pitching two products that are in very different industries. Let me give you an example, imagine Alphabet, Google’s parent company, needed to create a joint business plan.
This would be the most complex plan of all time as they have tons of products. In their case, they would probably create a business plan for each product. Additionally, they would create an information memorandum or something to gather all these products under one umbrella. But just as a general document.
If you need a Joint Business Plan For a Merger – Then Beware of this Checklist
It’s a good feeling when you believe you found another entrepreneur to help fulfill your vision of a merger. Sometimes, but definitely not always, mergers could create legendary companies like Disney.
In other cases, like Google and Motorolla, it’s just a waste of time and money for everyone.
So the first thing to check if you’re looking for a joint business plan of two companies as a merger option is team synchronization.
This is usually the main reason why multiple M&As (Mergers and acquisitions) don’t work. This makes perfect sense. Let’s analyze.
A company has its own team, work methodology, environment, vision, and operations. If another tries to join in, it requires significant change from one of the parties in order to be coherent. This does not happen in many cases. It leads to failure, which leads to a waste of time.
So the first thing you should really consider is the coherency between the two parties. I’d recommend trying out such a merger for at least a year. If everything seems to be working fine, then you can consider moving on.
Your team could be perfect. Their team could be perfect. But the market might just reject your combined products. Remember, the market always has the final word when it comes to business.
For that, research is king. You need to double down on your market research for such a merger. Are you both operating for the same target segment? Could it by any means reflect negatively?
Write another fifty questions and perform a detailed analysis before taking a step forward.
Your brand tells a story. When you merge with another company, your brand has changed. Imagine a Harry Potter movie with a Star Wars environment. Harry Potter fans might hate it. Star Wars fans might also hate it. This is what I would call a lose-lose.
I would recommend getting outside consultants for this particular point. You need your marketing team to tell you what your brand means to your customers. Then put scenarios of your collaboration. Would you like to eat a Mcdonald’s Pizza? A McPizza? (That was actually a real failed product.)
Long term vision
Finally, this is something that needs to be put in a legal form. You can’t actually do that. But I’m just stressing how important this is. Let me give you an example.
Elon Musk joined Martin Eberhard, JB Straubel, Marc Tarpenning, and Ian Wright in creating Tesla. Now, these are five individuals with five different brains. It does not make sense that they all have the same vision. With a few sneaky business moves here and there, Elon Musk took control of Tesla. Then he used it to transform his vision into a reality.
If there was a change in how things turned out to be, you might have been seeing the Tesla “Eberhard” version rather than the “Musk” version. Who knows what that would’ve looked like?
Joint Business Plan Template
That’s all you need to remember before creating a joint business plan. If you’re looking for a template, then I would recommend this one.
Meet The Author Of This Article
I’m Al Anany, the founder and CEO of Albusi.
I always have a single goal while writing: focus on entertaining while adding value.