AVON, CONNECTICUT, USA (February 24, 2004)�About 30 percent of the worksite carriers in a recent Eastbridge study entitled Joint Ventures and Alliances for Worksite Marketing said they generate some sales through joint ventures. Alliances and outsourcing agreements, while not specifically measured in the study, are likely to be even more prevalent. So why such a high percentage?
“Based on our study, lack of internal expertise is the most common reason carriers look outside for products,” says Gil Lowerre, president of Eastbridge. “Many carriers just don’t have the ‘know how’ to build all the products that their distributors want and need,” adds Lowerre. Speed to the market and cheaper costs are also reasons that carriers outsource product manufacturing. Renting expertise is often much cheaper�and faster�than trying to develop the resources in-house.
Although these arrangements have proven successful for many carriers and outsource partners such relationships take commitment and resources. “First, both parties need to evaluate one another�from financials and administration to corporate culture and values,” comments Eastbridge vice president, Bonnie Brazzell. It’s also important for each side to understand the objectives, goals, and expectations of one another and to make sure all are in sync. According to Brazzell, “We’ve seen too many carriers (on either side of an agreement) with outrageous expectations, especially when it comes to sales. Outsourcing agreements cans also have unrealistic assumptions about claims or other aspects of the product.”
The key, according to the carriers surveyed, is having regular communications between partners�and not waiting for a problem or issue to surface before speaking. Periodic review meetings should be scheduled where both parties can talk about what is working and what needs improvement.
The Joint Ventures and Alliances for Worksite Marketing report gathered data from carriers and those representing outsource partners. The study explores the current and potential joint venture/alliance opportunities from both participants’ perspectives.
For more information visit www.eastbridge.com