What is Business Relations
Business relations are the connections that exist between all entities that engage in commerce. That includes the relationships between various stakeholders in any business network, such as those between employers and employees, employers and business partners, and all the companies a company associates with.
Breaking Down Business Relations
A company's business relations may include a long list of customers, vendors, sales leads, potential customers, banks, stockbrokers, service providers and any municipal, state and federal governmental agencies. Essentially, business relations are all of the entities with which a business is connected or expects to have a connection, whether internal or external.
Businesses depend on the development and maintenance of vital relations with employees, business partners, suppliers, customers — any person or entity that is involved in the business process. Companies that intentionally cultivate and maintain connections may be more successful than those that ignore these connections. Strong business relations can promote customer awareness, customer retention and collaboration between businesses in the supply chain.
Business Relations Hallmarks
Hallmarks of good business relations include trust, loyalty and communication. The success of long-term business relations is dependent upon trust, as it can foster employee satisfaction, co-operation, motivation and innovation. Similarly, loyalty helps companies form strong and lasting relationships with employees, who return that loyalty by providing high-quality services. That, in turn, can translate to high customer satisfaction and better sales because customers tend to pay more for products or services when they hold a company in high regard. Inherent to trust and loyalty are good communication, which is essential to managing and optimizing internal and external business relations.
Establishing good communications protocols early on can facilitate and improve planning, projects and policymaking. From a financial standpoint, business relations can theoretically make or break a business. Strong business relations can create a competitive advantage. Weak relations can lead to detrimental outcomes, including unhappy employees, dissatisfied customers, negative reputations and limited growth.
Business Relations in Practice
Many companies use a number of strategies to ensure strong business relations are fostered and appropriately maintained. Relations may be established through a number of means including social media, emails, phone calls, face-to-face meetings, etc. Relations can similarly be maintained through frequent contact (by phone, email, in person, social media, etc.). Social media as an integral part of business relations can give users and companies a competitive advantage and therefore improve business performance. Multiple modes of contact tends to translate to stronger business relations, though face-to-face contact is the most effective method. More contact generally equals stronger business relations.