Joint ventures can be beneficial to companies aiming to broaden to brand-new markets and areas. Carry on reading to get more information.

There's a long list of joint . ventures that covers different sectors and companies across the globe, a few of which have actually culminated in the creation of the world's most successful companies. That said, there are different types of joint ventures and picking the right one significantly depends upon the objectives of the entities involved and the nature of their respective organisations. For example, project-based joint ventures are a kind of collaboration that combines 2 entities from various backgrounds to reach a common goal. This could be a JV in between a business entity and a university or short-term collaboration in between a businessman and a federal government such as Farhad Azima and Ras Al Khaimah's joint venture. Vertical joint ventures are also another popular means for expansion as these combine two entities that co-exist in the same supply chain like buyers and suppliers, and they provide increased growth opportunities for both parties.

For decades, joint ventures in international business have culminated in mutually advantageous outcomes, and entities such as Geely and Concordium's recent joint venture is a fine example on this. There are lots of reasons why companies go into joint ventures but possibly the most important of which is to leverage resources and gain access to expertise that one business may be missing. For instance, one company may have excellent marketing and distribution channels however does not have a structured manufacturing hub. By partnering with a company that has a well-established production process, both entities benefit considerably. Another reason JVs are popular is the truth that companies share costs and risks when starting a joint venture. This makes the partnership more appealing as both parties would share the expense of labour and advertising, and they both take advantage of lower production costs per unit by leveraging their abilities and combining expertise.

Business expansion is an ambitious objective that any entrepreneur thinks about at some time throughout their career, however, it can be an extremely stressful and pricey procedure. It is for these factors that some entrepreneurs go with joint ventures when attempting to break into new markets and territories. Launching a world-class joint venture such as Telkom Indonesia and Telstra's joint venture can greatly increase the possibilities of success as partners pool their resources and connections in an drive to maximise performance. For instance, a business wanting to expand its distribution to brand-new markets and areas can take advantage of partnering with regional players. This way, it can take advantage of a currently existing regional distribution network, not to mention having access to knowledge and know-how on the target audience. Beyond this, regulations in certain jurisdictions restrict access to foreign businesses, suggesting that a JV agreement with a local entity would be the only way to gain admittance.