Co-op advertising is a cost-sharing arrangement between a manufacturer, supplier, wholesaler or distributor and your business in which the manufacturer pays for part of your advertisement.

The catch? In exchange for paying for a sizable portion of the ad, the manufacturer or supplier will want the ad to mention its product or business. When a grocery store advertises a certain brand of bananas, when a tire store features a famous tire in its ads or when a carpet company features a certain carpet brand, you're seeing co-op advertising at work.

It is a classic win-win. For you, the small-business owner, co-op funds offer a variety of benefits:

• They allow you to reduce the cost of your current advertising or advertise more.
• They permit you to create bigger or more colorful ads.
• Because co-op funds can usually be used in any medium (television, radio, print, online, phone directories and so on), they make it possible to extend your brand into areas where you may not have had much reach previously.

By the same token, suppliers, manufacturers, distributors and wholesalers also benefit from co-op advertising programs:

• Co-op ads increase overall awareness of their brand.
• They increase their sales.
• They increase their market share.