No matter how solid your resolution process appears to be on paper, your business will be in jeopardy if a business decision threatens to drive out a partner while she is still a key asset to the business. Just as a sole proprietor is a single person running a business without the formality of incorporating, a partnership is a business run by two or more people who equally divide the risks and benefits of the business.
Partnerships have some dangers in ongoing management, which can avoided with proper planning. Consult with outside experts after you have finished drawing up your partnership agreement, but before you begin operating under it.
A married couple, for example, may allocate financial management "trump votes" to one spouse, and marketing and sales planning to the other. Partnerships pool startup capital to build their business, but frequently partners come to the table with different amounts of money.
Appoint an outside ombudsman, or a panel of advisers, to resolve disputes which cannot be resolved internally. This can differ widely from the division of labor later in the business; therefore, make repayment of your initial investments, with appropriate returns on investment, part of your business plan, to avoid later disagreements over the value of startup capital vs.
Advantages and Disadvantages of General Partnerships About the Author Ellis Davidson has been a self-employed Internet and technology consultant, entrepreneur and author since Determine a method of resolving disputes between partners.
Draw up a mission statement for the business that is agreed to by all partners equally. Your legal and accounting advisers may see issue areas you missed, or an experienced entrepreneur may be able to point out problems with your methods well in advance of problems that may arise.
Ideally, a partnership of an odd number people can resolve disputes by a democratic voting process; alternately, give some partners a "trump vote" in the areas of their expertise.
He has written a book about self-employment for recent college graduates and is a regular contributor to "Macworld" and the TidBITS technology newsletter. Develop an equitable means of reimbursing partners for their startup costs and investments.
Divide up the labor and management responsibilities of the partners, and determine exactly how each partner will be compensated for their effort. He is completing a book on self-employment options during a recession. Many partners are old friends, family members or spouses, and presume that these ties will prevent amicable resolution of disagreements; these partners may find that friendships, families and marriages can be wrecked by the stresses of running a business.
If you cannot resolve a problem internally, have trusted experts on hand to guide you through disputes. For example, a partnership may decide to divide all profits equally, but may pay salaried bonuses before profit calculations to some partners, to compensate them for workloads or responsibilities, which may be inequitably distributed.Dec 13, · Before you go into business with a partner, you’ll need to create a written agreement.
If you plan on going into business with a business partner, a written partnership agreement is important. If you and your partners don’t spell out your rights and responsibilities in a written business /5(52).
A Business Plan is a written document that outlines a company's goals and how it plans to achieve them. It also encompasses several other aspects of a company's future agenda and can serve as a tool for internal decision-making or as a business proposal to pitch to potential investors. A business plan is a written description of your business's future, a document that tells what you plan to do and how you plan to do it.
If you jot. Writing a Business Plan Georgia State SBDC 2 Why Write a Business Plan? A Business Plan helps you evaluate the feasibility of a new business idea in an objective, critical, and unemotional way.
Dec 13, · The partnership is the simplest and least expensive co-owned business structure to create and maintain.
However, there a few important facts you should know before you begin. Personal liability for all owners First, partners are personally liable for all business debts and obligations, including 4/5(4).
Now that you understand why you need a business plan and you've spent some time doing your homework gathering the information you need to create one, it's time to roll up your sleeves and get.Download