How to collaborate with other businesses

The first coronavirus wave and national lockdown in spring 2020 saw many businesses seek collaboration opportunities – as a way of reducing the impact of closures and lesser demand.

With UK businesses once again navigating a challenging business landscape and increased COVID restrictions, in 2021 collaboration will again play a crucial role in helping them survive and thrive.

Our partner Be the Business explores how collaborating with other businesses can take different forms and have many benefits. It could be working together to create a new product or service, or working together to pay for and create new distribution or production approaches.

Businesses working together can pool resources and share costs, making affordable some initiatives or activities each couldn’t undertake alone.

Collaborations can be informal agreements to help each other or a formal strategic alliance with signed paperwork and contracts.

Getting separate businesses to work together is not easy. There are often common obstacles to overcome and risks of working together with companies and people you don’t know. It helps to have a checklist on how to approach it, which is what we’ve developed for you here.

1. What’s collaboration?

There are many different forms of collaboration, all of value to their participants. It can be as little as networking with businesses in a town or local area. It could be informal information sharing between businesses in the same sector in a region; sharing problems or experiences, through to a formal alliance to work together on a project sharing costs and revenue.

Undertaking different forms of collaboration will have its own burdens and steps. The following guide is focused on the deeper forms of collaboration with either a formal or semi-formal type of working together.



What’s collaboration?

2. Considerations

Most people start and run their own business because they like to be their own boss and want to build their own company.

Collaborating with other businesses doesn’t come naturally to many owners. But, particularly in a crisis, there are times when businesses are stronger together and where they can seize opportunities or meet challenges that they couldn’t on their own.

However, in a crisis like the current coronavirus, businesses can work together to survive and support each other. Here’s a step-by-step guide to how to do it.

Step 1: Research your options

The starting point has to be being really clear on the problem you are looking to solve or the opportunity that you can seize.

Without a clear understanding of what you want to get out of a collaboration you have no basis for choosing the right partner and agreeing what you will collaborate on. Shopify has four suggestions for different ways that businesses with an online focus can collaborate.

When you’ve identified the opportunity, research your potential partners. A government initiative, InnovateUK, has a useful video and page on the importance of not just partnering with the first business you meet.

Once you’ve identified the opportunity take the time, before you talk to potential partners, to list out all the assets and capabilities your business would bring to the partnership. Being confident and clear on all the things your business brings makes for a stronger and more positive negotiation and partnership.

Step 2: Choosing your partner

Meet and get to know your potential partners. At the moment, when face-to-face meetings are largely impossible, this will be harder. It is worth investing the time and effort in video calls though to really get to know your potential partners. have a useful guide on collaborating.

As in any negotiation or agreement it’s important to think about not just what’s in it for you but also what’s in it for your partner. Collaborations only work where there is value for all participants that reflects the investment and effort that goes into them.

When you have identified a partner, make sure that you have worked out and agreed what each partner will do. Add what they expect to get out of the collaboration too and write this down on paper.

If you’re pursuing a deeper, larger-scale collaboration then consider using a lawyer to make it a formal agreement. Northern Ireland business information have a useful guide to setting up the different levels of collaboration.

Step 3: Working together

There are three things to consider here in particular:

  • Once you start working together, it’s essential to monitor and evaluate how it’s going. When two businesses aren’t used to working together there will inevitably be problems, big or small. The key to minimising and overcoming them is open communication and a clear and regular joint assessment of how the collaboration is working.
  • At the start of the collaboration agree together measures for evaluating the relationship. The process of agreeing them together will help with ensuring that you have a shared understanding and expectation of what you’re both trying to achieve. Take the time to check your progress on those measures regularly. The frequency will vary with the nature of how you’re working together and what you are doing. Measure more frequently at the start to make sure that you spot any problems early.
  • Have open and straightforward conversations with your partner about what is working and where there are problems. Particularly at the start - collaborating is unlikely to be easy. After all, it’s something that most businesses don’t do. The more businesses that are working together the more complicated it becomes. Where there are unresolvable problems, be open with each other and if the problems are critical be prepared to end the collaboration.

Approached in this way, with clear expectations from all parties, collaboration can be a way to unlock new opportunities or to stand together to face the disruption and difficulty of the coronavirus outbreak.

3. Be the Business

This article was produced by our partner Be the Business. We’re working with Be the Business to help businesses across the UK improve their productivity and boost their performance.

Find out more about Be the Business.






Be the Business

Managing business costs and uncertainty

Support, guidance and financial options to help you build financial resilience and manage the impact of rising costs and economic factors on doing business.

Coronavirus support

Find information and support for your business from accessing your account and managing cash flow to government-backed lending schemes.

Support employee’s wellbeing

Maintaining a good level of mental health within your workforce is more important than ever.

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