Having a business partner is often beneficial, but almost every partnership will have disagreements at some point. Hopefully, you and your partner can work things out without having to take legal action.
There are two strategies that minimize the chances of having a dispute with your business partner: Making sure it is a good relationship from the start and signing a contract that outlines details about the business and partnership.
Choose the right partner
According to the Coworking Mag, the first strategy is to pick the right person for the job. In general, a good partner shares the same vision and mission for the company and complements your strengths and skills.
It is smart not to rush the decision, as it takes time to really get to know someone. You may like someone as a person, but imagine spending hours on end making decisions with him or her. Trusting each other is essential, and you both should be honest about your strengths and what you are looking for in a partner.
Discuss the overall goals of the business and talk about what that looks like for each of you. You should also be able to communicate well, as that is extremely important to maintain a good working relationship.
Write up a partnership agreement
The Chron discusses the importance of writing up a partnership agreement. This legal contract outlines the details necessary to run the business, and it brings clarity to the relationship. Some things to include are:
- Monetary and labor contributions of each partner
- Ownership percentages
- Profit and loss distribution
- Decision-making power
- Partnership exit plans
- Daily and overall responsibilities of each partner
Many contracts also include the desired method of resolution in the event there is an unresolved dispute between partners.