A 3 minute read
Before starting any acquisition, there is one common question that businesses often ask themselves – whether they should buy, build or partner. When asking a random business leader about their major objectives for 2022, you’ll likely hear those growth and innovation they aim for in the New Year. CEOs, CIOs and other executives consider growth their major goal as they look for new opportunities toward stable and progressive development for their companies.
Every business working toward achieving a big goal can choose from different routines to get there. The approaches and techniques may differ. However, all of them fall into three main categories – buying, building, and partnering. What’s the right choice for you? Let’s see.
- Buying suggests that your company merges or acquires a business that compliments your project or expands its reach.
- Building means you use in-house capabilities, talent, and resources to grow and expand.
- Partnering suggests your brand joins forces with another company experienced in your topic and has the expertise needed to reach your goal.
Before making the right decision, there are several major considerations you need to take into account. Weigh the pros and cons of each option to ensure you choose the right way to accomplish your plan. Consider the following factors while making the build vs buy vs partner decisions.
- Human Resources. Do you need to expand your current team or your team has all the needed skills to achieve your goal? To make the right choice, calculate how much time, money, and effort it will cost you to hire more staff. Maybe it would be a better choice to expand your team through partnerships?
- Money. What budget can you afford to accomplish your goal? Buying is always the most expensive decision. The partnership is the most cost-effective than two other options, though it may include additional expenses like training new staff or upgrading the technology.
- Timing. How fast do you want your project to be up and running? Partnering is the least time-consuming option since you work with a well-established team. Opting for buying and building takes more time. Are you ready to wait for months until an acquisition meets your needs?
- Value. What are the main advantages you will get while teaming up with another company? What are the main values from buying or building? Unlike building something from scratch, buying and partnering lets you improve the well-established media relationships, SEO, and industry resupation.
Building and buying make more sense in most situations. However, partneting is often a smart move for companies looking forward to expanding their reach and growing more efficiently. When your company considers to partner with another busines, you take on less risk and long-term commitment. It’s like dating someone seriously before proposing. While entering this kind of business relationship, ensure that you and your partner’s company share similar goals and values and both of you are willing to achieve them ASAP.