If you are thinking about going into business with another individual, it is important to know that a partnership can either make or break a company. If you want to have a successful business endeavor, you must also set up a successful partnership.
The first step is to choose the partner that best complements your abilities. You must also have a collaborative and detailed conversation with your partner about the business and include everything in an agreement.
Choose the right partner
Entrepreneur discusses that choosing a partner in business is similar to choosing a partner in life. Just as you would typically date someone for a while before tying the knot, you must get to know a potential partner, and it is best if you know him or her for at least a year.
Honesty and trustworthiness are two important traits in a partner. You should also have the same vision, mission and goals for the business. Besides making sure your core values align, this is where similarities should end. The key to a successful partnership is complementing each other’s skills and abilities. For example, if you are a visionary, you should partner with someone who is good at details and planning. If you are terrible with numbers, your partner should have skills in finance.
Write a partnership agreement
Once you have chosen a partner, the next step is to write out all the details of your partnership in a contract. Homeland Magazine outlines some of the major elements addressed in this agreement:
- Ownership
- Liability
- Control
- Partnership dissolution or transfer
A thorough agreement helps to prevent conflicts and arguments. However, another smart thing to include is how you will resolve potential disagreements, such as with mediation or arbitration.
