A few weeks ago, Brandon Valorisation explained in an article how an SME could diversify its activity by licensing innovative products. This month, we emphasize the advantages of collaboration and its importance in the innovation process.
Just an example:
A subcontractor SME in the mechanical industry, with 25 employees, planned to use a license for a patented product in mechatronics to diversify its activity, develop its expertise and increase its reputation.
Its resources enabled it to validate the normative aspects and to carry out an industrialization study with the technical support of the patent holder.
However, this product incorporates a specific know-how in electronics that is difficult for the company to acquire in the short term.
Rather than looking for a subcontractor, the manager planned to work in partnership with a company willing to share the benefits but also the expenses, and the risks created to the project. This company would provide him with the additional skills needed to lead the project.
The manager then mandated a firm specialized in the search of one or more partners that could meet this need.
When the search is successful, a partnership agreement is signed with an SME based in the electronics sector and having all necessary resources and means, but also able to ensure the commercialization of the product.
Like this company, it is possible for any SME to differentiate or diversify their activities by integrating new technologies or additional know-how.
However, it is generally difficult to acquire and master these technologies or know-how in the short term within the company. That is why collaborative work may be considered. Indeed, it makes it possible to accelerate this integration and therefore to enhance the company’s offer more quickly.
Brandon Valorisation frequently supports small businesses in this search for partnerships, whether it is about developing a new product, or more about finding someone able to commercialize a product. In some cases, this partnership can extend to an opening of company’s capital.
Collaboration, a more secure option:
If the company wishes to exploit know-how or technology that it does not master, it will be difficult for it to call a subcontractor in a completely secure manner. Indeed, for a subcontracting to be effective, it is essential to clearly specify the needs first. This requires a certain expertise in relation to the know-how that the company wishes to use. The collaboration process therefore begins as soon as the specifications are drawn up.
It is therefore preferable to opt for co-development. The partner of the company will then help it to define the specifications of its product on the aspects he controls and will assume his share of risk.
So, for such a collaboration to be balanced, it is recommended to search for a partner who may be:
- A company of comparable size. Indeed, it is regularly observed that companies of very different sizes who collaborate on a common project tend to not share the same strategy.
- A university or an engineering school.
- A specialized laboratory, provided that a confidentiality agreement has first been signed.
Similarly, a production company that knows how to develop new products but does not necessarily know how to market them efficiently can consider a distribution agreement. In this case, it is interesting to consider the signature of a marketing agreement with a company which can do it.
Partnership is not a guarantee of success, but if it is properly done, it can give the company every chance of success for its project.
And, if the business manager thinks the challenge is worthwhile, he can launch its own new product on the market, on an exclusive basis.
Below is a graphic showing the development of a partnership: