Similar to any other business endeavour, joint ventures have advantages and drawbacks. This post will note the most notable ones.

For decades, joint ventures in international business have culminated in mutually beneficial results, and entities such as Geely and Concordium's recent joint venture is a good example on this. There are numerous reasons companies enter joint ventures but possibly the most important of which is to take advantage of resources and access knowledge that one business might be missing. For example, one business may have outstanding marketing and distribution channels but does not have a structured manufacturing hub. By partnering with a company that has a reputable manufacturing process, both entities benefit greatly. Another reason JVs are popular is the fact that businesses share costs and risks when embarking on a joint venture. This makes the partnership more enticing as both parties would share the cost of labour and marketing, and they both take advantage of lower production expenses per unit by leveraging their abilities and integrating expertise.

There's a long list of joint ventures that spans various sectors and companies across the globe, a few of which have culminated in the creation of the world's most successful companies. That stated, there are various types of joint ventures and picking the best one greatly depends upon the objectives of the entities involved and the nature of their respective organisations. For example, project-based joint ventures are a type of partnership that brings together 2 entities from different backgrounds to reach a common goal. This could be a JV between an industrial entity and a university or short-term partnership in between an entrepreneur and a federal government such as Farhad Azima and Ras Al Khaimah's joint venture. Vertical joint ventures are likewise another popular vehicle for growth as these unite 2 entities that co-exist in the exact same supply chain like buyers and wholesellers, and they provide increased growth opportunities for both parties.

Business growth is an ambitious objective that any entrepreneur considers at some here time throughout their professional career, nevertheless, it can be a really demanding and costly process. It is for these reasons that some business owners opt for joint ventures when attempting to break into brand-new markets and areas. Launching a world-class joint venture such as Telkom Indonesia and Telstra's joint venture can significantly increase the opportunities of success as partners pool their resources and connections in an effort to increase effectiveness. For instance, a company wishing to broaden its distribution to new markets and territories can gain from partnering with regional businesses. By doing this, it can benefit from an already existing local distribution network, not to mention having access to knowledge and proficiency on the target audience. Beyond this, guidelines in specific jurisdictions restrict access to foreign businesses, indicating that a JV contract with a local entity would be the only way to gain access.