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LIKE YOU. LOVE YOU. HATE YOU.
Before you say, “I do,” think it through.
By Karin K. Schaff Glazier
Do you have a great idea for a product or service? Are you thinking about involving someone else in that great idea—perhaps a best friend or family member? If so, be cautious! When you marry your friendship with a business partnership, you need to be very cognizant of the diverse dynamics of each type of relationship—and outline and plan the “agreement” accordingly. Going through a “friend to business partnership relationship” myself, I am fully aware of the ins and outs of what individuals should look for, pay attention to and operate by when it comes to saying, “I do.”
A business relationship is much different than a friendship in many ways. Therefore, you need to outline the techniques and approaches to working together up front; this allows you to help avoid future conflict, as well as the risk of losing the friendship altogether. With proactive thinking and realistic expectations, plus a touch of complete honesty, you can have a mutually beneficial partnership.
When entering into a business partnership with a “friend,” be sure to consider the following:
- 100% honesty is the best policy. Upon entering the business agreement, the partners need to open to one another their “personal books” about any financial requirements or limitations that exist. For example, most startup businesses do not have enough capital to pull wages right away, sometimes for months. Make sure both of you are fully aware of this possibility and will be prepared and completely agreeable to not receiving wages until revenue begins to flow into the business. In addition, be on the same page with how much of that revenue gets put back into the business to support growth.
- Have a partnership agreement! No matter what you think of your soon-to-be business partner and how much you feel you can “trust” that person, it’s critical to have a partnership agreement outlined on paper. This will ensure that one or both of you doesn’t change your mind midstream on the dos and don’ts of the business. Remember, close family members have been known to get in bitter fights over money and materialistic items; your partnership is no different.
- Determine your roles and responsibilities. Many times, partners’ enthusiasm, passion, and personal and professional investment get in the way of running the business and establishing a process. A simple solution to avoiding stumbling over one another and duplicating efforts (and avoiding power plays) is to take a sheet of paper and list each other’s roles and responsibilities. The list should also include your strengths and those of the other person. This list helps a great deal in deciding where you both can leverage one another’s strengths to better the business.
- Trust each other! If you start a business working from home offices, you need to trust that your business partner is doing everything possible to get the business up and running—ultimately to show a revenue stream and then, in time, a profit. You can ensure that this issue doesn’t arise in several ways. You can set weekly staff meetings to go over needs as well as discuss current sales activities and projects; you can also establish work hours from 8 a.m. to 5 p.m. In addition, you can set objectives and goals to accomplishing key milestones; revisit them to determine their success rate.
- No capital could mean no business growth. Even though businesses can start up without capital, it is very rare that those companies can grow as quickly as those with capital. Make sure both of you are ready to put more money into the business than you will get out right away. In addition, keep in mind that the business can pay you back through cutting an expense check for business-related purchases—once money is available to do so!
- Things are not always equal. Just because you are “partners” doesn’t mean everything will always be equal between you both. For example, one of you may need health coverage while the other does not. You need to weigh these decisions carefully to make sure both partners are fairly supported as well as compensated. The need for health insurance and the desire to receive it are things that fall under the 100% honestly policy mentioned earlier. Discuss these issues before moving into business together, not after.
Partnerships can be great success stories or complete nightmares. Remember, a partnership in business is between people, and people have different likes, dislikes, personalities, work ethics, expectations, personal and professional goals, and views on what success is. Be smart. Before you say, “I do,” think it through carefully and strategically. Then, make the move that is best for you.
All rights reserved. No reproduction of any kind of
this article is allowed without written consent by author.
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For more information about how Pinpoint Positioning can help you
remove the barriers to marketing success, please call Karin K. Schaff
Glazier at 585.330.1811. You can also e-mail her at:
karin@pinptpositioning.com
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