Building a firm in isolation limits growth potential. No business — accounting and tax practices included — can succeed and grow without establishing relationships. Aligning with other practices and business professionals has become more critical than ever before. Some of the benefits of developing mutually beneficial strategic partnerships include:

• Boost trust and credibility as prospects see that other reputable companies have confidence in your firm.
• Gain qualified referrals as more prospects within your target market learn about your business.
• Increase revenue as you attract more qualified leads and convert them into paying clients.
• Save time because strategic partnerships allow you to spend less time prospecting for ideal customers.
• Expand profitability as you’re able to spend less money on advertising and marketing costs by leveraging your strategic partnerships and their reach.
• Extend your professional network as you gain more opportunities to connect with people you otherwise might not have met.
• Build client loyalty by directing your customers to reliable, trustworthy service providers (your strategic partners) that will provide exceptional value and quality when satisfying client needs beyond the scope of what your business offers.

So, what are some ways you can go about starting and nurturing relationships that will empower you to reap these rewards?

Four tips for developing successful strategic partnerships

1. Carefully choose the professionals and companies you want to approach about being strategic partners.

Think about whom within your network and community provides services or products that complement your business in some way. Some examples to consider include:

• Business consultants;
• Executive and leadership coaches;
• Attorneys;
• Life coaches;
• Office supply stores;
• IT companies that specialize in implementing accounting and tax software solutions.

Also, don’t disregard businesses that offer some of the same services you do. Tax preparers and bookkeepers may have clients who need services they don’t — or are not legally allowed to — provide. Having them as a strategic partner to whom you can point clients in need of bookkeeping and general tax return preparation can give you some breathing room when your workload is at capacity.

You might even consider reaching out to other accounting firms to see if you have synergy. If their specialties are different from yours, or if you both want to have a trusted resource to take on overflow business when your plate is full, a “competitor” might make an ideal partner.

Be picky when deciding whom you will approach about forming a strategic partnership. It’s critical to align yourself with firms and professionals who are ethical, responsive, reliable and capable. Even though strategic partners are not part of your firm, they will, to some extent, be an extension of your brand in the eyes of the clients you share.

2. Learn about each other’s business.

Invest some time learning about your strategic partners’ capabilities, skills and unique qualities that set them apart from their competition. The more you know about them, the better able you will be to identify opportunities to direct clients their way for services you don’t provide.

Likewise, openly communicate with your strategic partners about your services and the value you provide. You’ll want them to have a firm understanding of what you offer and the types of opportunities you welcome. Also, realize that learning about each other will be an ongoing to-do. As your businesses evolve and add or remove services, you must communicate with each other to ensure you refer the right clients under the right circumstances.

3. Agree on how you will work together.

Although you and your strategic partners are operating independently, you will need to reach a consensus on serving mutual clients. Talk about and document in detail how you plan to help each other fulfill clients’ unanswered needs. Further critical details to discuss include:

• Will you share any company assets (e.g., software platforms, office supplies, equipment, etc.) when serving mutual clients?
• How will you invoice customers when you’re both providing services to them? (Will you send separate invoices, or will your business send an invoice that includes the billing for your services and those of your strategic partner? If so, how and when will you pass that payment along to your strategic partner?)

While a handshake or verbal agreement may seem simple and no-fuss, consider putting everything in writing to avoid misunderstandings and disagreements. I encourage you to discuss with an attorney if a formal contract is advisable to protect your and your strategic partners’ interests.

4. Regularly assess your strategic partnership arrangements.

Strategic relationships should be mutually beneficial and well thought out so they don’t interfere with each other or create conflicts of interest. Periodically schedule time to talk with your strategic partners about what’s working and what’s not. If a relationship is heavily one-sided in whom it’s benefitting—or if it’s not delivering value to either of you — you may want to discuss tactics for improving the collaboration or part ways.

“Alone we can do so little; together we can do so much.” — Helen Keller

Business owners, new and experienced, too often think they must do it all on their own or they’re tentative about giving away too much insight about how their company operates. Either mindset can stand in the way of forming the types of strategic relationships that will enhance and expand your business. Always take measures to protect your confidential and proprietary information and processes, but also keep an open mind to see opportunities for collaborations that can help you grow your business.