Potential advantages and risks to implementing a cooperative strategy

Topic 

Potential advantages and risks to implementing a cooperative strategy

Instructions

What are some potential advantages to implementing a cooperative strategy?  What might be some potential risks?

Answer Preview 

A cooperative strategy is a strategy in which firms work together to achieve a shared objective. They usually have a business arrangement where both parties benefit. Firms share and combine effort in a variety of ways but not limited to sharing information, knowledge, expertise, losses as well as profits. Potential advantages to implementing a cooperative strategy include financial gain, market-entry, growth, risk protection, and competitive advantage. Financially a combination of resources enables the firms to come together to produce more products, they also increase their borrowing power and hence can receive aid easier than when as an individual.

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