International Strategic Alliance Agreement

The analysis phase sets performance targets for the partnership. These objectives are used to determine the general skills of the business that are needed. During the selection phase, these performance objectives are used as criteria for evaluating and selecting potential alliance partners. The most frequent activities related to the analysis phase are: [25] Strategic alliances can be flexible and some of the burdens that a joint venture could entail. The two companies are not obligated to merge capital and may remain independent of each other. Many companies find it difficult to operate their alliances as they had imagined, and many of these partnerships are not meeting their defined goals. A few common mistakes are that the costs of a comprehensive strategic alliance are generally distributed equitably among the companies involved and are generally the most cost-effective way for all stakeholders to form a partnership. An acquisition, on the other hand, offers a faster start to using an overseas market, but it tends to be much more expensive for the recipient company – a business that is probably very much after reach for an exclusive supplier. While a global strategic alliance works well for the expansion of core business and the operation of existing geographic markets, an acquisition works best for the immediate penetration of new geographic areas. This is why an alliance offers a good solution for global distributors who do not have the necessary distribution to access overseas markets. Even if you are not an international technology company or the world leader in mobile telephony, you can follow the example of Nokia and Microsoft and see which contacts, colleagues, colleagues and competitors in the international market may have compatible needs and objectives. You`ll probably feel the safest with a company with which you already have a long-standing business relationship, especially if you`ve achieved significant revenue growth together.

It could be your distributor in South Africa, a manufacturer that has taken over the distribution of your product in China, or that trading company in Japan that cannot keep up with consumer demand. Any of your contacts with a problem that you can solve or a need that you can address could serve as a potential partner. They must also be informed of the political and economic stability of the host country. Contact local economic development offices in the host country. You should be able to assess the country`s future investment climate and share past, current and future growth trends. This will give you a better idea of the risks you will take if you continue with the Alliance.