Keys To Ensure That A Business Partnership Works

Keys To Ensure That A Business Partnership Works

Starting a solo business is usually exciting but quite tough and demanding when dealing with difficult situations.

Hence, while we give life to the business idea The questions that we all ask ourselves about the convenience of associating arise:

  • Should I find a partner?
  • Will I be able to handle the financial and mental burden of the development of my project alone?
  • It is better to be alone than in bad company?
  • What is the best way to ensure that the business works?

Doubting whether the business will run well partnering with another person can be a matter of great importance when starting that can make a difference in the success or failure of a company.

On the one hand, it is proven that the so-called Public Limited Companies can work very well and enhance the possibilities to unimaginable levels, provided that some rules are followed.

Advantages of a Business in Partnership

  • You share the investment
  • You share responsibilities and workload
  • You make more consensual decisions
  • There is a balance of ideas when planning
  • Solving everyday problems can be more effective

Disadvantages of a partnership business

  • Problems if the conditions are not clear
  • Annoyance if functions are not clearly distributed
  • Mishandling of money
  • Confusion with staff
  • Unnecessary wear and tear on discussions

In general, your decisions can be better if you have a partner.

But how to achieve success in a society?

Partnering means sharing the burden in every sense of the word. If we understand it this way from the beginning, it is easier “get on the boat” in a business project.

We talk about sharing the responsibility of the business, the capital to invest, the work and also the profits.

Of course, this distribution can be shared between one or more partners and does not necessarily mean that everyone has to have equal shares.

A decisive aspect is that societies can divide these powers into clearly agreed proportions from the beginning. In fact, not everyone invests the same, therefore not everyone will earn the same.

Some partners contribute money, others will contribute machinery and equipment, others invest their time and labor, and eventually others only consulting.

Everything is important and valuable for the development of a company. However, the fundamental thing is not the proportion itself, but taking care that everything related to the company is carefully stipulated and with sufficient clarity on the part of each partner involved.

Each one must assume specific responsibilities and preferably have a salary assigned for them. It must be agreed from the beginning and in detail its attributions, schedules, responsibilities and what is expected of it.

Everything must be in writing. For this reason, it is essential that a document be prepared that can be called “partnership agreement“,”partners agreement“or similar, where the corresponding initial agreements are left in writing.

Of course, if the partners consider it convenient, or if the level of investment warrants it, this document must be legalized in order to protect each other and prevent a disagreement from affecting the company or the other partners.

Unfortunately, in practice, many companies and companies are weakened and even destroyed by simple misunderstandings or disagreements between the partners, which, had they been established in writing and stipulated with sufficient clarity, would not have occurred.

In conclusion, societies work. Two or three heads are better than one and the well-known proverb of “the Union makes the force“is real at the time of do business.

The key is to respect each other and develop the agreement that strengthens and protects them as entrepreneurs.

Have you participated in any society?
Could you contribute something from your own experience to enrich this topic?

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