A joint venture partner is a company or individual that joins forces with one or more other companies to jointly pursue a new project, business activity or specific entrepreneurial initiative. In doing so, the partners involved contribute their respective resources, expertise, technology or capital to realize the venture.
In the event that a product is developed by multiple vendors, it is possible to set up a joint venture partnership to determine appropriate shares and avoid misunderstandings in revenue distribution.
A joint venture partner (JVP) is another vendor who has contributed a part to your product. For example, you created a series of videos for an online course, but left the editing of those (e.g., editing and subtitles) to someone else you want to participate. So you're offering a joint venture partnership.
To distribute the sales fairly, you need to define the share of the joint venture in percent. The rest of the process is automatic. After the product is sold, the revenue is automatically split between you and your joint venture partner. All joint venture partners that are stored in your product will be taken into account.
If the percentage rate is changed, this change will also apply to all subsequent subscription and installment payments.
The joint venture statistics are available for viewing on the “Transactions” page under the “Joint Venture” tab.
The total amount of JVP shares plus the vendor's share may not exceed 100%. The vendor's share is the sum that remains after all JVP shares have been deducted from the total revenue.
If the JVP shares for a particular product already add up to 100%, the Vendor will receive EUR 0.00 of the revenue accordingly.
Remember that affiliates cannot be joint venture partners for the same product at the same time.
Types of JVP
The vendor can select which service the JV partner can provide on the product page.
There are the following services that JVPs can offer at CopeCart:
Service: the JVP provides services for this product.
Sales Intermediation: The JVP is an intermediary in a product sales process.
Affiliate Management: The JVP manages affiliates for the specified product.
Support: The JVP provides support for this product.
Support Management: The JVP manages the support team for this product.
Product Development Assistance: The JVP assists with product development.
Product Manufacturer: The JVP is the manufacturer of this product.
Please note that these descriptions only serve to define your joint venture partners. The Joint Venture Partner's share and rights do not depend on the services provided.
Calculation process at a glance
Remember that a vendor always receives its share at the end. This means that deductions from the big amount are arranged as follows:
Applicable Tax Payment
CopeCart fee
Affiliate commission
Joint Venture Partner share
The sum that remains after all deductions is the net amount earned.
Gross amount—VAT - CopeCart commission—Affiliate commission—JVP share = Net amount earned
Distribution of revenue between joint venture partners
Total revenue is a revenue that is shared between a Vendor and its Joint Venture Partners. Essentially, it is a sum that remains after the tax charges, CopeCart fee and affiliate commission have been collected.
Gross amount—VAT - CopeCart fee—Affiliate commission = Total income.
How much will a Joint Venture Partner and a Vendor each gain?
This depends on their share of the total income set by the Vendor.
Example:
The gross amount is €1190.00, the VAT rate for the product is 19%, the CopeCart fee is equal to 4.9% of the gross amount + €1 per transaction. The affiliate commission is 50%.
Net amount = €1000
VAT = €190
CopeCart fee = €59.31
Affiliate commission = €470.35
Gross amount—VAT - CopeCart commission—Affiliate commission = total income
€1190—€190—€59.31—€470.35 = €470.34
€470.34 is the total income that will be divided between the JVPs and the Vendor according to the established rates.
The Vendor has set the share of one JVP at 30% and the share of another JVP at 40%. The vendor share is therefore 30% of the total income.
JVP1 receives €141.10 (30 % of total income = 30 % × €470.34)
JVP2 receives €188.14 (40 % of total income = 40 % × €470.34)
Net earned amount of the vendor = total income—JVP1 share—JVP2 share
Net earned amount of the vendor = €141.10 (€470.34—€141.10—€188.14)