In a joint venture, two or more companies combine certain assets and work toward jointly achieving a business objective. Usually the time period of this combination is defined and limited in duration. This venture is then formally created as a business entity such as a separate corporation or partnership.
Strategic alliances are less formal associations between companies compared with joint ventures. In a joint venture, a separate entity is often created, whereas in a strategic alliance the agreement and the relationship are less formal.
Overall, if the entrepreneur is able to work alongside their business partner, joint ventures and strategic alliances offer a way to leverage the comparative advantage of each business in order to accelerate the growth of each business. By sharing core competencies, businesses can take the next step towards achieving their growth objectives.
There are many questions that will be answered in this video;
- What are joint ventures?
- What are strategic alliances?
- What are the advantages of joint ventures?
- What are the advantages of strategic alliances?
- What Determines The Success Of Strategic Alliances?
- What are the shareholder wealth effects of strategic alliances & joint ventures?
- Is a vertical or horizontal joint venture more profitable?
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