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Patrick Gallagher, CEO of CitySprint, discusses how businesses can use collaboration to move from just "surviving" to "thriving".

It’s been an optimistic couple of weeks for UK businesses. We’ve seen the government report a decrease in unemployment figures and the CBI hail the return of growth on the high street. Although the clouds of recession may not have disappeared, they do appear to be receding.

No one in their right mind would want to prolong a recession, but the challenging economic climate recent years has brought about some positive changes. Put simply, businesses were forced to work more closely together, and CitySprint’s annual Collaborate UK report found that 3.2 million SMEs are still sharing skills, expertise and networks to this very day. This trend of close cooperation could shape the future of business in the UK.

Benefits of collaboration

There are many benefits to collaboration between businesses. By partnering with companies that have specialist knowledge, SMEs can focus on their area of expertise while strengthening their offering and being more flexible and efficient. For example, a marketing agency could exchange free services with a design agency, enabling both to offer more comprehensive packages to their clients and as a result boost their bottom lines.

Similarly, collaboration allows SMEs to keep fixed costs low, making them more agile and able to react to changes in the market – particularly important during a time of recession. This, in fact, this is something we have noted in our own business when operating in a market that experienced natural peaks and troughs.

As we begin to leave the darker days behind us, appetite for risk is growing amongst businesses. SMEs are no longer simply looking to “survive” anymore, they are looking to “thrive”; our research found that marketing & advertising and sales & customer services were the most outsourced functions last year, ousting training and legal services from the top three. With this push for expansion in mind, it’s important that businesses find partners that make mutual support of both parties’ ambitions possible.

Here are three things to consider when pursuing a collaborative business relationship:

1. Don’t settle for sub-par service

Collaborative partnerships often involve businesses exchanging or providing discounted services to one another, or recommending their respective services to clients. However, working together for mutual advantage should not mean accepting anything but the highest quality of work. The relationship must be built on trust; if your partner fails to deliver an acceptable service, don’t be afraid to seek another.

2. Look beyond your borders

For two years running, our Collaborate UK report has found that the “lack” of good business partners has hampered many SMEs in their collaborative pursuits. However, as almost 5 million small businesses contribute to the UK economy, it’s likely this talent does in fact exist but locating it can be a challenge. If the right collaboration partner isn’t next door, look further afield and use available technology to overcome physical distance.

3. Feel free to flirt

Like any relationship, you may not find the perfect match straight away. You should feel free to trial and test services with several partners to find the most like-minded businesses to work with. In fact, there’s nothing wrong with collaborating with multiple partners, even in the same sector, provided the relationship is mutually beneficial for all parties.

We are all familiar with the idiom “two heads are better than one”, and it is certainly applicable to growing SMEs. Ultimately, those businesses that collaborate effectively will be best placed to pursue bigger and better opportunities, and even take on larger competitors.

Emma.Catlow
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