CREDIT: DUSTY KNUCKLE/MATT AYRES
Support can be invaluable to SMEs, especially in the early days. For some, this comes in the form of collaborating with other small businesses that share values and goals. Collaborations can be seamless, or they can be incredibly difficult. Here, SMEs with experience of teaming up share their stories of success and strife.
Maximising a trend
Dashcams are one of the fastest growing areas of consumer electronics, now that the UK’s biggest insurance companies accept footage as evidence. Nextbase, the UK’s largest manufacturer of dashcams, knew that it needed to infiltrate the insurance market, so it collaborated with Sure Thing! Insurance Services to offer discounts on each other’s products.
“When we met them, it became obvious that our goals aligned and collaborating could be mutually beneficial, raising awareness of both companies,” Nextbase’s director Richard Browning says. “Our partnership gave us the flexibility to provide significant discounts while gaining valuable sector insight, crucial for the direction in which we were heading.”
Being on the same page was critical, he adds. “Think about the value a collaboration could bring. Do your goals align? Will it be worth the extra work? On this occasion, it most certainly was, but this isn’t always the case.”
For Crunch, a financial services company for small businesses and the self-employed, it went beyond sharing goals.
“Our online accountancy software was only available for limited companies, so we wanted a collaborator who could deliver software to make it accessible to sole traders too,” says chief executive Darren Fell. “We had a healthy rivalry with FreeAgent, competing for limited company clients. We realised that the quickest way for us to build our services was to collaborate with a business that shared our values.”
It has proved successful for both parties, amplifying their names and making it possible for them to offer more services. “It reaffirmed our belief that collaboration is often the key to success,” says Mr Fell. “We’re determined to put our customers’ needs first. Innovation and internal growth are not the only answer to achieving that.”
Working with competitors isn’t for every SME. When Wales’ biggest independent visitor attraction, Folly Farm Adventure Park and Zoo, recognised a need for more affordable and effective leaflet distribution locally, it was cautious about who it teamed up with on its group venture.
“Distribution companies represent many businesses on their stands, but we weren’t standing out, so we tried distributing as a small group of similar tourist-focused businesses,” says Zoë Wright, the company’s head of marketing. “It was important to pick complementary attractions that have a strong reputation like us, but are not our competitors.”
The approach has been questioned, but Folly Farm is sticking with it, because it works. “We’re often contacted by other local businesses that want to come in on the collaboration, but we’re successful because it’s exclusive. We’re not looking to become a distribution company; we just want to make our brochures stand out from the crowd.”
From pop-ups to partnerships
Some SMEs collaborate after meeting at pop-up events. Natasha Broady, owner of online homeware outlet, A Splash of Colour, met Joel Adebayo, founder of clothing brand, UTTER Couture, at a pop-up unit in Shoreditch’s BoxPark.
“We respected each other’s businesses. We felt that the fusion of the two non-conflicting brands would work,” Ms Broady says. “We hoped that collaborating would bring a more rounded lifestyle concept to UTTER’s in-store customers, while giving us the opportunity to have a high street presence – something that’s invaluable for a new business.”
It took only a week from initial conversations to Ms Broady’s products being stocked in UTTERCouture. But keeping both online and in-store customers happy has been a learning curve. “I’ve noticed a split in what my both customers want, so I’m definitely widening the customer base,” she says. “It’s going well, but it could be six months before I see clear results. Patience and adaptability are key.”
Similarly, Positivitea, a wellbeing tea producer, and Well + Happy, a guilt-free raw chocolate company, paired up after meeting at an event. “We met at a yoga pop-up event,” explains Positivitea’s founder, Ellie Wharton. “We were both serving our products and were struck by the synergy between our brands in terms of market demographic and positive messaging.”
The two companies now promote each other’s products, with plans to hit trade fairs and launch product packs together. They recently teamed up on Chakra & Chocolate gift boxes – a tea and chocolate treat box that both brands sell online.
It’s a relatively casual and enjoyable partnership, says Ms Wharton: “It’s easy to collaborate with someone who shares your mindset. We haven’t entered into any lengthy and litigious contracts. It’s just a profit share and a meeting of minds.”
Like-minded and shared values
Dusty Knuckle, a street-food pizza business, grew as it toured South Wales’ food markets. “We had the opportunity to meet great producers who knew their produce and went to huge efforts to make it,” says co-founder Phill Lewis. “We developed organic relationships with companies and collaborations came through those.”
The company juggled multiple collaborations at once. “Charcutier Ltd, a local meat producer, developed a pepperoni product exclusively for us,” says Mr Lewis, who has also worked with Crafty Devil, a local brewing company.
Their relationship echoes that of Positivitea. “There were no formal meetings and contracts, although an occasional pub meeting was called for,” he says. “We were just like-minded people getting together to look at how we could progress our businesses.”
Mr Lewis is pleased with how things are going. He has learnt a lot, he says. “Clear communication channels, trust and shared values are crucial for whomever you go into business with. I’m not talking from personal experience, but it’s easy to see how it can go wrong if those things don’t exist.”
Source: The Daily Telegraph