Thursday, July 9, 2015

Should I have a partner for my small business?

Beth and I are fortunate to have a really great partnership so in my experience, having a partner makes owning a small business much easier.  We have been able to split duties easily and what scares me doesn't scare her and what makes her nervous doesn't bother me.  We have seen other partnerships which have not been successful.

Being a solo entrepreneur can be stressful as all the decisions must be made by the single owner. The positive is that there is no need to compromise: the solo entrepreneur gets to decide exactly how the business should be run.

Take your time to get to know a potential partner.  Have detailed conversations about your business philosophies: how to handle employees, problem customers, borrowing money, raising prices, etc.  Determine how you are going to handle disagreements, especially if you have equal ownership.

One of the most important things you can do to insure a successful partnership is to put together a detailed operating agreement.  We have talked in early articles about the kinds of things you should include in an operating agreement and the best way to put one together.  See  How to create a successful partnership

If you have owned the business by yourself it can be difficult to share the decision making with a partner.  The business is like your child and it can be difficult to let go of full control. Make sure you test out your ability to do so before you sign any legal documents and form any partnerships.

Having a partner can give you additional funds at start up and during tines of expansion.  It gives you additional thoughts on how to solve problems and more hands to get the work done.  Just make sure you pick the right partner so the business and the partnership is a success and not a nightmare.

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