White-label partnerships solve problems. They provide opportunities to improve product quality, account growth and personal development.
In the interest of time, I’m not going to list the daily challenges every agency owner faces. Or, for that matter, the hurdles any agency team has to overcome, from Account Managers, to Sales Reps, to Client Services Directors, you know the pains of growing an agency.
Today, I’m going to focus on some specific short-term challenges (the “oh sh*t moments”) as well as longer-term challenges to realise the ambitions every stakeholder has for their agency.
To save suspense – I’m looking at the following:
The “Oh sh*t” Challenges:
- Impending resource gaps.
- Team capacity ceilings.
Ambition Challenges:
- Diversifying revenue streams.
- Securing longer, more lucrative retainer contracts.
All of the above can, at best, leave you feeling like you’re chasing your tail. At worst, it’s the start of a pretty grim spiral away from your objectives.
The solution? White-label partners.
To me, a well delivered white-label partnership creates a genuine win-win. There aren’t many of those in the agency game, but if the end-client is getting a good service, your agency’s getting credit alongside a healthy margin, and your WL partner gets their fee – it’s pretty spotless.
What is White-Label?
The term White-Label (WL) originates from the image of a blank white label on a ready-made product, primed for the vendor to imprint their brand.
In real terms, a WL company, let’s call them ‘Company A’, will work for another company, ‘Company B’, essentially executing a product/service, but with Company B’s branding visible upon delivery. Very simply, The term “white-label” refers to products and services made by one company, but sold by another. The consumer/end-client needn’t be aware of any third-party involvement.
The core value-proposition behind WL for agencies is the ability to offer services to their clients, hands-free, with a set margin guaranteed. Each agency & end-client company will have different requirements and proper WL agencies can create bespoke packages to fit every brand or company’s needs.
For example, a creative agency might want to bring in a ‘Performance’ arm to help take their concepts to market. In reverse, an advertising agency might want a stronger content/creative offering to help give their campaigns that extra bit of spice.
Every agency’s challenges, position and objectives are unique, but have a look and see if one of these scratches an itch…
Advantages of White-Label:
1.
One-Stop-Shop Delivery Partner:
First and foremost, the biggest advantage of using a WL partner is that your agency can expand the services you offer. ‘One stop shop’ is horribly cliché, but in the current climate, as an agency with growth ambitions, being able to meet widely varied requirements from SMEs is incredibly valuable.
Partner up & offer a range of curated services from one WL provider to save time. Keeping everything under one roof has its own advantages which will be covered in more detail in the following points.
Expanding company services would usually mean money would have to be spent on recruitment, training and equipment; not impossible, but it’s slow and tricky. The other option would be to stretch current staff to cover the new services – and you probably already know that’s not a great route. Working with a WL partner allows you to deploy the required extra resource to deliver high-quality services, promptly, whilst keeping your staff doing what they do best.
2.
Ability To Compete With Larger Companies:
Traditionally, small agencies have found it difficult to compete with larger competitors. This was mainly due to not being able to offer enough specialisms under one roof, or being understaffed to deliver on larger projects/campaigns.
Many end-clients only want the biggest agency their budget can afford, but the smart clients prioritise an agency that’s got a personal delivery and genuine buy-in from all stakeholders on the account – which is much more common amongst small-mid sized agencies (Insert cliché no.2: “Big enough to deliver, small enough to care.”)
Ok, it’s always going to be hard to compete with larger agencies – that’s the nature of just about any industry. But, by using a WL partner to broaden your service offering, you can fill any gaps & get that proposal out the door! (Quick note – Partner with ZH.A & we’ll even help you put that proposal together…)
Working with a WL partner increases your manpower and gets you onto a level footing with your bigger competitors; without the burden of increased staff costs.
3.
Get Access To A Talent Pool Of Experts:
One of the biggest benefits of working with a WL agency is that you get access to their team of experts – growing your network, delivery options, and skill sets. As specialists, the team will have the most up-to-date techniques, tools and technology.
Again, save on staff, training and equipment, just plug & play.
4.
Improve Efficiency And Costs:
As mentioned throughout, WL can be a great cost-effective way to increase your company’s services and clients.
If your WL agreements have guaranteed margin levels, you’ve got the peace of mind that your cost base is covered, with a pre-agreed profit on top.
(Spoiler Alert: We always work with our agency partners to get margin-levels agreed up front to avoid any nasty surprises down the line).
5.
Gain More Clients & Retain Them:
Working with a WL partner will allow your company to take on more clients and also manage your current accounts’ needs more effectively.
You won’t get caught short on resource, you won’t have to decline adding new services as your clients’ businesses evolve, and you won’t have to worry about your staff struggling to manage workload.
Have the best of both worlds – secure your existing accounts for longer & go out to get more/bigger contracts with new prospects.
6.
More Freedom:
Outsourcing some of your services allows you more time to spend on what your company does best. You can keep your team working on the areas they are experts in and let your WL partner take care of the rest.
Prioritise key projects and streamline workloads; focus on your business’ goals and trust delivery with your WL partner.
7.
Scale Your Agency:
If you’ve read this far, it’s hopefully clear how a well-structured WL partnership will help you scale:
- Retain more accounts, for longer.
- Offer more services to maximise revenue opportunities.
- Control cost base via revenue with guaranteed margin.
- Take pressure off your internal team.
- (& My favourite: Arm yourself to stick it to the big agencies when you’re pitching up against them!)
The Downsides:
As a business, we’re “all in” on building our agency partnerships. Clearly, we’re big fans of white-label work.
But, sure, WL isn’t always perfect:
- If your WL partner develops too big an ego & tries to muscle in on your accounts, it could get ugly.
Depending on your partner, you’ll have to make a judgement on the likelihood of this happening, as well as protecting yourself with a Non-Compete in the meantime.
- Flipside, as your agency grows from the revenue generated through your WL partnership, you’ll potentially want to provide the services in-house, which stings for your WL partner (believe me, we’ve felt that pain a few times already…)
This happens, it’s business – it’s a good problem to have in a way because it means a job well done. In any case, not really your problem.
- If your client catches wind of the WL agreement, they might baulk at paying for your margin on top of the initial service delivery fee.
If your WL partner is professional and discreet, the chances of this are minimal. Plus, in our experience, clients genuinely don’t tend to care, as long as the service they’re paying for is of a high-quality & their needs are being met.
Of course, the pros & cons will be unique to your agency, so take the above as general assessments from our experience at ZH.A. (P.S. I’d love to hear if you think I’ve missed anything.)
Thoughts/Feeling/Concerns?
When done properly, WL is a huge opportunity for both agencies. It’s what we love at ZH.A – the opportunity to work with other, like-minded professionals, whilst still making a difference to a variety of businesses & their industries.
Let me know what you think though. If you have any questions, reach out via the form below or give us a call. If you want to get started, hit the “Partner With Us” button at the top of your screen, or again, give us a call! You can expect one of ZH.A’s founders to get back to you within a couple of hours.
Cheers,
Dominic
