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STRATEGIC ALLIANCE ACT AS CATALYST FOR GROWTH COMPANIES, FUELING THEIR RISE, 'TRENDSETTER BAROMETER' SURVEY FINDS

 NEW YORK, June 1 /PRNewswire/ -- Strategic business alliances are fueling the growth of America's most rapidly growing companies, according to the latest Coopers & Lybrand "Trendsetter Barometer" survey.
 More than half the CEOs of America's fastest growing companies (55 percent) say they are currently involved in an average of three strategic alliances, the survey found. Another 8 percent have plans to enter alliances, and say they will consider at least two, on average, over the next 12-month period.
 These businesses are likely to get an additional boost from the federal government. Last month the House of Representatives approved legislation that would encourage high-tech alliances for joint production ventures by limiting the firms' exu?re under antitrust laws. Joint ventures for research and development are already protected from antitrust judgments.
 Growth companies with alliances surveyed for "Trendsetter Barometer" differ from their counterparts that "go it alone" in that they are 11 percent larger in revenue, 8 percent larger in terms of employees, and are currently growing 20 percent faster. Almost two in three of these CEOs (64 percent) say these agreements are "very or critically important to present and future growth." Over the next 12 months, those involved in alliances expect a 30 percent annual growth rate, compared to 22 percent expected by firms without alliances.
 "These CEOs attach importance to strategic alliances because of the opportunities such associations provide for growth," says George Auxier, national director of entrepreneurial advisory services for Coopers & Lybrand, the international professional services firm. "These opportunities may be in the form of potential for entry into new markets, added financial leverage through avoidance of overhead or debt, improvements to products and manufacturing capabilities, technology commercialization, and risk sharing in an uncertain economic environment."
 But strategic alliance partnerships are not all alike, "Trendsetter Barometer" found. Although almost two-thirds (64 percent) involve joint marketing or promotional arrangements and more than half (52 percent) incorporate joint selling or distribution arrangements, they may provide for a host of other activities, such as technology licenses, design collaboration, research and development contracts, and production arrangements.
 Nearly eight in 10 growth firms participating in strategic alliances (78 percent) are partnering with larger companies. And a surprising 37 percent are involved in alliances with smaller firms.
 "Trendsetter Barometer" found that the most important strategic alliances for growth company CEOs are those with leading companies, and those involving research and development -- particularly new product development and licensing. Also of high importance were joint marketing and distribution agreements, especially for international selling, and joint manufacturing or production arrangements.
 Most fast-growth companies (85 percent) rely on their own executives for screening and due diligence on potential alliance candidates. And three-quarters say they informally source through trade and industry contacts.
 "It is remarkable," says Auxier, "that these special partnerships, so critical to business growth, are for the most part so informally chosen."
 One in three fast-growth CEOs currently involved in strategic alliances admits to an occasional failure, where the alliance turned out to be ineffective and was terminated early, or worked out badly for b ?parties. These failures were more apt to occur among service firms and among firms having a higher than average number of present and planned alliances.
 Coopers & Lybrand's "Trendsetter Barometer" is developed and compiled by the firm's entrepreneurial advisory services group with assistance from the opinion and economic research firm of Business Science International. At each Coopers & Lybrand office, an entrepreneurial advisory servit?eam is available to serve the needs of growing and midsize companies.
 One of the world's leading professional firms, Coopers & Lybrand provides services for enterprises in a wide range of industries. The firm offers its clients the expertise of more than 16,000 professionals and staff in 101 U.S. offices and more than 66,000 people in 120 countries worldwide.
 -0- 6/1/93
 /NOTE TO EDITORS: Coopers & Lybrand's "Trendsetter Barometer"


interviewed CEOs of 400 product and service companies identified in the media as the fastest growing U.S. businesses over the last five years. The surveyed companies range in size from approximately $1 million to $50 million in revenue/sales. Graphic art available upon request./
 /CONTACT: Maggie O'Donovan of Coopers & Lybrand, 212-536-3174/


CO: Coopers & Lybrand ST: IN: SU: ECO

SM-WB -- NY007 -- 3926 06/01/93 11:56 EDT
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Date:Jun 1, 1993
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