9 Things to Consider Before Forming a Business Partnership
If you are the kind of person who always has an idea, or you are someone who is actively looking for one, forming a business partnership may be something that interests you. Partnerships, when they work properly can be very good for output and productivity. However to keep things working well it is important to consider these 9 things before entering into a business partnership with anyone.
1.) Length of Partnership
It isn’t just the length of time that you have known your potential partner should matter to you but rather how long do they plan on being in your industry? Have they given any thought about what will happen if either of you get sick or injured or worse? Many people think planning for retirement is too far away so instead give little thought to it, or even none at all. However planning for this will help you plan other aspects of the business more effectively.
2.) Writing a Business Plan
If you are starting your own company with someone else make sure that you write your “Mission, Vision and Values” statements together. This is something that almost no one does but if you want to work well with another person and give equal input in decision making, than it is important that the two of you sit down and write these out together before moving forward. This way each partner gets their say without feeling like they were left out or unappreciated by the other member of their future firm.
3.) Keep Partners Fun
It is important that you and your partner enjoy each other’s company if you plan on working together for an extended period of time. Being around someone all the time can get old quick so it is important that not only do you both share some common interests but some different ones too. This way when things start to become mundane or there are problems, you always have something else to talk about rather than focusing on any negative aspects of your work life.
4.) Supplying Equal Effort
While one person may be better at writing business plans while another is better at math, make sure that no one feels like they are getting the short end of the stick when it comes to equal effort. You should never feel like your ideas aren’t being heard or worse, are being completely discounted. The only way to make sure that things are fair is if you both put your ideas out there, discuss them together and then focus on what everyone else has said rather than arguing over who’s idea it was first.
5.) Respect for Each Others Time
There will be times when one person needs to have time alone or vice versa, but at the same time you need to know that this should never happen during crunch times of company projects. When working together with someone it is important that you respect their wishes for wanting some personal time away from work but also respect the fact that they are putting in their share of effort along with you so there shouldn’t be too much complaining about occasional nights or weekends spent at the office.
6.) Agree on the Major Decisions
While you may be friends with your work partner, that doesn’t mean that all of your ideas are going to mesh at all times and as such you need to remember that there is a time for brainstorming and a time for making important decisions. When it comes down to making those key choices about where the company needs to go, make sure you both sit down together and discuss what is best for business before making any final decisions or committing yourself financially and emotionally.
7.) Discuss Legalities
One of the most important things that you have to do when creating a business partnership with anyone is talk about how money will be split up, who contributes what percentage of their knowledge and skill set and how much money each partner will be putting into the company. It is important that you get these issues talked about early on so that there are no surprises later on down the road when it comes time to decide whether or not to buy out your partner’s share of the company. This can cause major problems if you have put in a lot of work yourself but then have to pay for another person’s share as well just because they are not ready to leave yet.
8.) Running Meetings
Most people don’t realize this but holding meetings is one of the most important practices you should engage in with your business partners. Don’t meet everyone once a month, instead meet every day if possible so that you both are able to discuss any issues that come up daily. This will not only allow you to fix problems faster but also keep communication between the two of you completely open during the work day, allowing for less miscommunication or being left out of important company decisions.
9.) Plan Vacations Together
One of the most stressful things about working with someone is worrying about whether or not they are going to show up during your prime business hours while you are away on vacation. Make sure that everyone agrees on when they can take off and how this will affect the company before committing yourself financially towards growth that may or may not happen with one half of your business.
If you follow these tips then it should be possible for both partners in a business to truly respect each other and work on their shared goals together.
If you are the kind of person who always has an idea, or you are someone who is actively looking for one, forming a business partnership may be something that interests you. Partnerships, when they work properly can be very good for output and productivity. However to keep things working well it is important…