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Love Thine Enemy

Making friends with your rivals can help you grow--in life and in business.

In business, you'll likely have the chance to make both friends and enemies, much like in your personal life. But if given the chance to make a business enemy, can you choose to create an ally instead? If you're like Lee Labrada, founder of Labrada Nutrition, a manufacturer of sports nutrition products and functional foods, you can.

Labrada, 45, started his Houston-based company in 1996, and created a whole line of low-carb food products in 2003, trademarking the name CarbWatchers in the process. So he was surprised to find a low-carb weight-loss center in New York City using the same name while he was surfing on the internet one day.

Labrada hoped to resolve the conflict by sending a cease and desist letter--but fate had something better in mind. When the owner of CarbWatchers Weight Loss Centers called him to come to some sort of resolution, Labrada realized that he had a golden opportunity on his hands.

"We came to a meeting of the minds," Labrada says. "[We said], 'Why don't we figure out a way to work together?'" Instead of making the other entrepreneur change her business's name, Labrada decided it made perfect sense to stock his CarbWatchers products in her store--both would profit from the partnership, and both would raise the brand awareness of the CarbWatchers moniker.

"Based on my experience, it's better to try to work through a problem with a potential adversary than to go to court or involve attorneys in an ugly way," says Labrada, whose philosophy has helped him grow his company to $20 million in yearly sales. Now that sounds healthy.

This story appears in the March 2005 issue of Entrepreneur. Subscribe »