One of the joys of starting your own business is the ability to choose who to work with. However, if you dream of starting a business with a close friend, family member, or former colleague as a business partner, don't assume that everything will be easy just because you know each other. Like weddings, business partnerships often cross troubled waters.
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Why should you keep a business partnership?
41% of experts, use partner marketing to reach a wider audience. The next 20% partner to complete their offer with another company and another 18% join as a way to increase brand awareness. Unsurprisingly, some of the next reasons put forward by the experts, at 11%, are to increase sales and 5% to expand distribution.
Three other reasons, 2% each, said they formed partnerships to leverage the authority of another brand, enter a market they previously didn't have a place in, and leverage each other's domains.
To build strong business partnerships, follow these tips:
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Share the same values
Don't write the first word of your business plan until you know that you and your partner have the same dreams, goals, and vision for your new business. Does your partner dream of opening the next Starbucks, while you envision a part-time restaurant business that allows you to spend a lot of time with your family? You and your partner must share the same core values, goals, and work ethic if you want the company to be successful.
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Choose a partner with complementary skills
When you and your business partner have different strengths, you will soon double the power of your startup team. For example, a shy technician who wants to start an internet business would do well to find a partner with sales, marketing, and people skills. This way, both partners can focus on doing what they love and are good at.
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Have a story together
Being successful as a business partner doesn't require running a business together or even collaborating first. It requires a track record to successfully overcome similar challenges together. Look for a partner with whom you have managed conflicts, achieved common goals, and survived difficult times in the past.
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Clearly define the role and responsibilities of each partner
An informal organization where each partner does what is needed at that time may work in the early stages of a startup, but not in the long run. Defining each partner's title and functions helps eliminate disagreements by giving each partner control of their domain. Employees and customers also benefit from knowing which partner manages which aspects of the business.
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Select the appropriate business structure.
A partnership can be organized as a general partnership, limited partnership, or limited liability company. You can organize it in whichever way you wish. Each form of business has its advantages and disadvantages in terms of liability, taxes, and continuity. Speak to an attorney or other experienced consultant to determine which form of business is right for you and your partner.
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Put it in writing.
Even if you are starting a business with your best friend from kindergarten, you need to prepare legal documents regarding the structure of your business, the capital contribution to the business, how decisions will be made and disputes resolved, and what happens if a partner wishes to leave. the business. Thinking about all the things that could go wrong and how to handle them makes it easier to deal with the difficulties that arise.
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Be honest with each other.
Holding onto your true feelings because you don't want to hurt your business partner will cause more problems than it will eliminate. For your partnership to work, you both need to feel comfortable openly sharing your opinions and discussing any disagreements that come up. Sweeping your worries under the rug only leads to bitterness and resentment that can destroy your partnership and your business.
These can be difficult topics to discuss, especially when you're excited about your startup and can't wait to get started. But unless you take the time to lay the foundation for a lasting business partnership, your new business may never get off the ground.
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