Joint Venture

A Joint Venture is a cooperative enterprise in which two or more business entities enter together. The business entities, on creation of a joint venture, may form a separate corporation or a partnership. There are also cases where the business entities retain their own individuality, while entering into a joint venture agreement which is operated as a separate entity altogether.

What Happens In A Joint Venture?
  * Before two or more companies join together, they decide on the terms and the conditions of the venture. The terms are decided in a way that all participating companies benefit in some way. When a joint venture is formed, the parent companies pool together agreed resources like capital, human resource, profits, risks etc. They share business expertise, technology, distribution channels and sometimes, even clients. Joint ventures are usually viewed as strategic alliances.
What Are The Benefits Of A Joint Venture?
  * There are many joint venture benefits. The biggest advantage is perhaps the combining of technologies and research, which can help cut costs and improve quality. The pooling in of human talent can help increase efficiency of commercialization of the business concept. The economic risk becomes shared and there is greater financial support and finally, joint ventures have larger resources to expand into hitherto uncharted markets.
Points To Consider Before Entering A Joint Venture
  * There are certain strategies which should be made clear before entering into a joint venture. The business plan of the new venture should be the foremost consideration. Leadership of the joint venture, communication strategies, human resource and talent acquisition are some of the important points that should be given due consideration before a final agreement on the venture is formed.
Joint Venture Trends
  * According to Ian Hewitt, author of the book ‘Joint Ventures’, the primary goal of joint ventures today is to form cross border alliances...