The 5 Essentials All Business Partners Need To Agree On
For some people, setting up a business means going into a partnership with a friend or professional contact. There can be numerous reasons why partnering up with someone can be very advantageous in the world of business. It gives you the chance to pool your money together so that you can take advantage of a larger sum of savings with which to fund the business. It’s not just money you can pool – both of you might bring different sets of skills and experience to the table as well, which can put you in better stead to make a success of the company.
But teaming up with a business partner doesn’t come without its own set of issues as well. For example, you might not both see completely eye to eye on certain business matters and when trying to make some decisions. So, it’s important that you make sure you work with someone who you are compatible with and who you agree with on the majority of business affairs.
Here are some of the essentials that you will always need to be agreeable on.
#1 Ownership Of The Company
One of the most important things to decide upon right from the outset if the split of ownership between the two of you. If you are both going to own 50% of the company, then this won’t be a difficult decision at all.
However, if one of you is putting more capital into the company up front, they may want a larger share of the business. For example, they might want to own 70% of the company while you take the remaining 30%. The split of ownership can be whatever you want it to be. Your partner might even want to be a sleeping party with little or no responsibility – in this case, you could own up to 95% of the business.
#2 Each Other’s Role
You also need to be very clear about what each of you is responsible for within the company. Otherwise, you could end up stepping on each other’s toes when you are both trying to do the same task. So, when you are in the very early stages of setting up the business, it’s worth sitting down together and splitting up the tasks and responsibilities between the two of you.
This is why it is often advantageous to team up with a partner who has slightly different expertise to your own. For instance, if your partner comes from a financial background, they will be able to oversee all of the company’s accounting and bookkeeping, while you can deal with the side of the business that is your specialty.
#3 Employee Development
Not many employers realize it, but fostering a work environment that promotes employee development is critical for any business. As a result, it’s essential that you and your business partner agree on the best ways to provide training for your workforce.
You will need to think carefully about whether your company will offer in-house training or if it is more beneficial to send employees on training days at places like the TraCen Guard Base. This is a decision that you and your partner will need to agree on as either option is going to be a big investment for your company.
#4 Dealing With Unexpected Developments
Who knows what will pop up in your business’s future?! We can’t tell what may happen, unfortunately, but there are some common emergencies and unexpected developments that many businesses will have to deal with. Even though you will hopefully never have to deal with any, it’s still coming up with a plan or solution to help you out of these tricky situations.
Not only will this keep you prepared, but it also ensures that you and your business partner are always on the same page when anything happens out of the blue.
#5 Bringing The Company To A Close
Companies can’t always last forever. Even though you will no doubt want yours to be a long-term success, it is still important that you agree with your partner about how you will dissolve it if things ever go south.
It’s also worth discussing how one partner can leave the company if they want out before the other does. Make sure you are always open and honest in all discussions about future departures so that you don’t get your wires mixed.
Once you have agreed on all of the above, everything else associated with running a business with a partner should come easy. Good luck with it!
