Frequently Asked Questions
A JV is a very profitable arrangement since it provides the parties to the JV with a huge number of benefits. The JV could be advantageous in the following ways:
- Using the resources and strength that each party has to offer.
- Establishing a platform to achieve commercial objectives that would be challenging or expensive to accomplish on its own.
- Access to emerging markets or niches.
- Increase market share in current areas; diversify into new industries.
- Provide competitive advantages.
- Shares the risk or initial losses that come with starting a new firm.
- Enables the company to grow with less cash.
The following structures are possible for a JV:
2. Partner-Based Business
4. Strategic Partnership
No. This is not required.
The J.V.’s participants may contribute in the form of cash, plant and equipment, technology, clients, know-how and expertise, etc.