By joining forces with like-minded businesses, entrepreneurs can unlock new horizons and jack up their business growth. According to statistics, about 60 to 70 percent of most joint ventures fail within the first five years due to cultural challenges. As per the Harvard Business Review, joint ventures that keep evolving perform better; however, restructuring joint ventures is crucial for maximum stability and growth.
The joint venture between Starbucks and PepsiCo is a top example of leveraging expertise to boost market opportunities. In 1994, these two companies joined forces to distribute and market Starbucks’ ready-to-drink beverages. By merging Starbucks’ coffee expertise and PepsiCo’s vast distribution network, the joint venture successfully expanded the reach of Starbucks’ products beyond its own stores. This collaboration enabled Starbucks to explore fresh avenues for generating revenue while benefiting from PepsiCo’s extensive knowledge in the beverage sector. This case study exemplifies the power of joint ventures to fuel strategic partnerships.
Another successful example is Vistara, a joint venture of Tata Sons Private Limited and Singapore Airlines Limited (SIA), which was formed in 2013. These two legendary brands decided to fulfill a long-cherished shared dream to provide an unparalleled flying experience to air travelers in India. The common goal of this joint venture was to redefine air travel in India to offer Indian travelers a seamless and personalised experience, blending Tata Sons and SIA’s service excellence and legendary hospitality together. With this joint venture, Vistara bagged the title of being the second-largest domestic airline in India in July 2022 and secured it for six months.
As per Deloitte, a joint venture resembles a marriage, requiring dedication and investment in nurturing the partnership with your collaborator. Once a joint venture is formulated, it shouldn’t be left alone in the midstream. Regular monitoring and evolution of a joint venture’s performance is crucial to ensuring its success. The success of a joint venture depends upon the combined alliance of strengths, resources, and expertise; the companies can achieve remarkable success and unlock new opportunities. To maintain a harmonious partnership and ensure the success of the venture, it is crucial for the companies involved to delineate precise objectives, select the appropriate partner, foster transparent communication, and establish clear roles and responsibilities.
