Steps to Forming a Successful Business Partnership

Forming a partnership can be advantageous in many ways. Joining with a partner means you get the benefit of their strengths and skills which may be different from your own. A partnership, however, is only as successful as the partnership relationship itself. Working with others can be challenging, so help set your partnership up for success with these tips.

Steps to Forming a Successful Business Partnership

Before you even establish your partnership, there are certain things you should do and precautions you should take to help ensure you are setting your endeavor up for success. This all starts with choosing the right partners. As previously stated, a partnership can be great when partners have complementary skills and strengths. Try to avoid partnering with someone just like yourself as this can be a valuable opportunity to build your business’s resources by backing it with leaders that bring different assets to the table. Your partnership will be, after all, a sum of its parts. So, if you love sales, but get lost in details, look for a detail-oriented partner. This will be the sort of thing to balance and round out your partnership.

While you will want a partner with different strengths and skills, you will want a partner that has similar values to your own. Nothing can spell disaster for a partnership like partners that have different work ethics, different, goals, and different values. These sorts of things, however, can be difficult to discern in a partner search. To help find out more about a potential partners values and goals, don’t just talk to them. Talk to their former co-workers. Do some online research about them, including reviewing their social media profiles. Talk to others that have a presence in your industry about them and their reputation among your peers.

Once you have found the right partner, the next step is to put down some very important rules, procedures, and more in writing. Create a comprehensive partnership agreement to manage expectations, streamline operations, and prepare for overcoming hurdles that will pop up for the partnership along the way. In the partnership agreement, be sure to address things like:

  • What contributions will be made by each partner?
  • What salary will each partner receive? Will earnings be equally split?
  • Who will manage the day to day business operations?
  • How will disagreements be resolved? Will mediation be required?
  • Can the partnership agreement be modified? If so, how?
  • Can new partners join the partnership?

Set up strong communication pathways between you and your partner. Communication may be the most important part of establishing and maintaining a partnership. Be prepared to address any issues that pop up between you and your partner and handle things with due care. Scheduling regular meetings and having other communication methods to touch base regularly can be great to solving problems before they become unmanageable. Take time to listen. Make a point to celebrate with your partner for all of the wins big and small.

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The team at Jones, Gregg, Creehan & Gerace is here to help set your partnership up for success. Contact us today.