Build Your Business Partnerships Carefully
In the early stages of forming or building a business, you may face the choice of whether or not to bring in a partner. And that may worry you, since you’ve probably heard stories about business partners who could not get along and ended up fighting for control of the company.
Studies show that two heads may be better than one. Businesses launched by partners, rather than solo entrepreneurs, have a better chance of really taking off, according to research by Marquette University’s Kohler Center for Entrepreneurship. Their study found that partners, not lone-wolf entrepreneurs, started more than 90 percent of America’s fastest growing companies.
Partners can share responsibilities and often bring different skills and knowledge to the business. One partner may be great with numbers and planning, while the other is a whiz at marketing and sales. Combining these elements can open more doors and help the business realize more opportunities more quickly than it could with only one person involved.
But conflicts between partners waste time and money, erode focus and strategic direction, cause emotional and financial pain and destroy businesses and reputations, says George Gage, a business mediator and partnership expert with BMC Associates in Washington, DC. Business schools rarely teach successful partnering techniques, and without proper preparation, partnerships are often doomed, says Gage, who has worked with many warring partners.
Gage, who is also author of The Partnership Charter: How to Start Out Right With Your New Business Partnership (or fix The One You’re In), lists seven cautions that would-be and existing partners should consider:
1) If you think you are not “partner material,” don’t take the partner path.
2) Use extreme caution when selecting a partner.
3) If you don’t really need a partner, don’t get one.
4) If it doesn’t feel good before you start, follow your gut and don’t do it.
5) Don’t be fooled into thinking that legal agreements and documents will keep you out of trouble with one another.
6) If you currently have a partner, and it does not feel like a positive working relationship, don’t just ignore it. Try to fix things.
7) If there are unanswered questions or vague boundaries and responsibilities with current partners, address these issues while you are still getting along.
For additional planning help for your small business, contact SCORE “Counselors to America’s Small Business.” SCORE is a nonprofit organization of more than 10,500 volunteer business counselors who provide free, confidential business counseling and training workshops to small business owners. Call (570) 851.1608 or visit www.scorescranton.org to contact the Greater Scranton Area SCORE Chapter.