The strategic alliance in practice: Renovator and design/paint store ...

Ottawa mayor Jim Watson (centre) with OakWood Renovation Experts CEO John Liptak

John Liptak, president of OakWood Renovation Experts, invited several industry representatives and community leaders to the grand opening of ?the Oakwood Renovation Design Centre?in a Randall?s paint and decorating store at a suburban shopping centre yesterday.

Hardly earth-shattering news, you might say, but beneath the ritual ribbon cutting with Ottawa mayor Jim Watson is a fundamental business concept ? the strategic alliance between two complementary, yet distinctive, businesses.

Both Randall?s and OakWood are locally owned. ?This means decisions can be made without reference to ?higher authorities?. Both have modern, state-of-the-art showrooms in areas where current and potential clients could relate. ?And both offer complementary products/services. ?Homeowners planning for renovations need paint and decorating supplies. ?A store selling these supplies will likely find at least some new customers (or extended purchases from existing clients) if it can partner effectively with a local renovation contractor.

Here, the concept is simple. ?OakWood has a small room set aside in each of the four Randall?s locations where renovation clients can meet with Oakwood representatives to conduct initial plans and estimates for their work. ?The OakWood rooms are linked to the renovator?s central computer server, with the capacity to produce comprehensive plans and quotations.

Certainly, I think most of us attending yesterday?s event enjoyed the reconnecting and networking ? this perception may reflect personal bias, as through a variety of relationships, I knew many of the people in the room. ?The mayor, I think, referred to Ottawa Construction News as the equivalent of the New York Times for construction in Ottawa. ?We also publish the Greater Ottawa Home Builder Association?s internal newsletter, The Impact! and (in partnership), Ottawa Renovates magazine, which we started at the request of the GOHBA?s Renovator?s Council.

Enough for the connections . . . the question is, will the strategic alliance between OakWood and Randall?s succeed?

I think so, provided the ?exclusivity risk? is managed effectively. ?That is, if two strategic alliance partners are so closely identified as allies, will others shy away from wanting to do business with one or another of the two businesses? ?You can gain some insights into the risks and advantages of strategic alliances in my Society for Marketing Professional Services (SMPS) Foundation white paper on the topic.

In this case, I think the potential rewards far outweigh the risks. ?Both the retailer and renovator can generate traffic and sales to benefit each others? business, and both have enough connections and relationships beyond the alliance which will be sustainable regardless of it.

Source: http://constructionmarketingideas.com/7152/the-strategic-alliance-in-practice-renovator-and-designpaint-store-chain-co-operate/

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