There has been a shift in West Michigan business over the past decade. Through advancements in technology and as a result of the economic downturn, many specialized small businesses have sprung up. Some (even those that own these businesses) view these small businesses as unable to compete with big established businesses. West Michigan is seeing a new trend that is changing that perception.
Small businesses often focus on very specific areas of a market. Our law firm is a classic example of this. We focus on business law and the areas of practice that our business clients need. Big firms can offer a full menu of services. They can offer an estate planning attorney, criminal law attorney, patent attorney, etc. Our firm, instead of spreading our resources thin, has chosen to be excellent in one area. Many other small businesses take this same approach.
In order to meet the demand of their customers or clients and also to leverage resources that they don’t have, many Grand Rapids small businesses are collaborating with other businesses. A collaboration is the agreement of two or more businesses to pool their resources (or a portion of their resources) together in a joint effort. Basically, small businesses come together to create an entity that can compete with much larger entities.
The Center for Entrepreneurship and Innovation (CEI) at Grand Valley State University actively tries to match young entrepreneurs with others that have talents or resources that complement each other. West Michigan coworking spaces like The HUB, The Factory, and East Grand Rapids’ 654 Croswell are springing up. There are a number of incubators like Start Garden that have also gained serious traction in the local community.
Small businesses have found a new level of success by coming out of their bubble and combining forces to create something stronger, faster and more innovative. While these collaborations can revolutionize your small business they have to be approached with some caution. Similar to choosing who to partner with to start your small business, who you choose to collaborate with should be vetted. Make sure they can actually fill the needs you want. At the same time, make sure you can fill the needs they want filled. Getting involved with another small business and hoping that it’s a fit is a recipe for trouble. If you cannot meet their needs, a potential dispute can creep up.
Having an agreement between the two collaborators is also vital. Not only can the agreement ensure that everyone knows what is expected of them but it can contain an exit strategy if things do go south. There is nothing worse than a project failing but then on top of it you are stuck to it. That failed project can easily become an anchor and you can’t get away from it.
A small business attorney can help guide you through the collaboration process and ensure that you are protected in the event of a successful collaboration or one that goes bad. We all want our small businesses to boom. The issues arise when we get too far ahead of ourselves without planning. Your West Michigan business lawyer can make you money by keeping you protected.
Source: “Focus shifts to collaboration, removing barriers for entrepreneurs” Nick Manes of MiBiz