
A joint venture (JV) is a business venture in which two or more organizations combine their resources to gain a tactical and strategic advantage in the marketplace.
Companies often enter into a joint company or joint venture to pursue specific projects.
The joint venture may be a new project with similar products or services or it may involve the creation of an entirely new company with different core business activities.
Companies initiate a joint venture through a contractual agreement between all parties involved. The profit and loss of the venture are shared by the participants.
THE MAIN ADVANTAGES OF JOINT VENTURES
A joint venture offers several benefits to its participants. It can help a business grow faster, increase productivity and generate additional profits.
Shared investment
Each party to the venture contributes a certain amount of initial capital to the project, according to the terms of the partnership agreement, thereby alleviating some of the financial burden imposed on each company.
Shared Expenses
Each party shares a common pool of resources, which can reduce costs on an overall basis.
Technical expertise and know-how
Each party to the joint venture often brings specialized expertise and knowledge, which helps make the joint venture strong enough to move aggressively in a specified direction.
New market penetration
A joint venture can enable companies to enter a new market very quickly, as all relevant regulations and logistics are handled by the local player. An international joint venture is an agreement between a company headquartered in country “A” and a company headquartered in country “B” that wants to gain market access in country “A”. With the creation of the joint venture, the companies are able to expand their product portfolio and market size, and the company from country B gets easy access to the market in country A.
New sources of revenue
Small companies often face limited resources and capital for growth projects. By entering into a joint venture with a larger company with more financial resources, the small business can grow faster. The larger company’s expanded distribution channels can also provide the smaller company with larger and/or more diversified revenue streams.
Intellectual Property Gains
Advanced technologies are often difficult for companies to create in-house. Therefore, companies often enter into joint ventures with technology-rich companies to gain access to these assets without having to spend the time and money to develop the assets for themselves. A large company with good access to financing can bring its working capital strength to a joint venture with a company that has limited financing capabilities but can provide key technology for product or service development.
Benefits of Synergy
Joint ventures can offer the same type of synergy benefits that companies often seek in mergers and acquisitions – either financial synergy that lowers the cost of capital, or operational synergy where two companies working together increase operational efficiency.
Increased credibility
It usually takes a long time for a start-up company to build market credibility and a strong customer base. For these companies, forming a joint venture with a larger, well-known brand can help them achieve greater market visibility and credibility more quickly.
Barriers to competition
One of the reasons for creating a joint venture is also to avoid competition and price pressure. Through collaboration with other companies, companies can sometimes effectively erect barriers to competitors that make it difficult for them to enter the market.
Improved economies of scale
A larger company always benefits from economies of scale, from which all parties in the joint venture also benefit. This refers to the notion of operational synergy.
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Actoria has allowed me to quickly diagnose the dysfunctions in the processes of our company, to offer optimizations and to implement them. Actoria has also successfully supported us in all phases of our company’s transfer to a group in our sector: preparation of my company, identification of buyer partners, negotiation up to the entry of the partner’s capital. Actoria brought us negotiation expertise and found us a good partner.
We were relatively anxious to find a solution because my health was deteriorating rapidly. Actoria’s consultant allowed me to successfully carry out my company’s sale. Its action has been crucial to carry out this delicate project because it involved all of our day-to-day activities. This project was close to my heart and was becoming increasingly necessary. The impulse given by Actoria was decisive to make it happen.
First, Actoria made an effective diagnosis of the strengths and weaknesses of our company and then proposed to take them into account in our management in order to increase the value of our company. Actoria led this project with my entire management team which made it possible to involve all the operatives and to be able to quickly implement a solution to enter the capital of an investor supplemented by the entry of certain executives of my company as well as a bank.
I couldn’t be happier with the result, but I am especially pleased with my decision to work with Actoria. The success of this mission was the direct result of Actoria’s hard work and sophisticated professionalism on my business. From our first meeting through the reasonable preparation process, all phases of the transfer, legal and financial operations were managed by the Actoria team. Their skills were even more evident when the complexities of this transaction were at its peak.
Hiring Actoria made the difference to achieve my original goal and move on to my next professional challenge. Selling a company like AMR in this market has not been an easy task. Actoria has demonstrated perseverance in identifying good buyers with knowledge of my industry in order to continue the development of my business, and has provided professional advice throughout the process.
The company’s sales process has been a very long and difficult journey. The professional support of Actoria made this effort much easier. I would especially like to thank the consultants from Switzerland and France for their very effective collaboration. Your consultants proposed creative solutions during the negotiations to effectively overcome significant obstacles in order to conclude the agreement. Their experience, knowledge and professionalism contributed to the success of this transaction.
The group in short :
Every year More than 30 successfull transactions with 20 Senior Consultants and Partners On companies with 5 to 100 employees With a turnover of 1 to 100 Million
We are located in many countries in Europe and Africa to provide access to foreign buyers/investors:
The question of selling a business in France arises sooner or later. How to find the right buyer in Europe ? How to successfully transfer my business in Europe ? When you want to hand the hand over to a successor, buyer, buyer or investor, the terms used are various: delivery company Europe, sale company france, sale company Europe, sale company Europe, sale small business in Europe. Whatever the terms used for the sale of your company in Europe, you can put your company on a list of companies for sale in Europe, a business exchange, or seek advice from a fusacq, a specialist in business transfer in Europe. With him you can think about the best buyer: family,employee, investment fund, external buyer. Sometimes it can offer you other solutions such as a getting closer to a company, a merging or establishing an alliance with another european company.
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