Having common long-term goals and objectives is critical when partnering with a new business. In some cases, it’s a matter of choosing a partner for a new venture. And others in having to bring on a new partner for an existing business, one where you hope they have the same aspirations and long-term commitment to success as you. But how do you know for sure whether this company the right one?
Having Common Long-Term Goals
First, you and your business partner must have the same long-term goals and objectives for the future. This involves being on the same page relative to your one, three, five, ten, and fifteen year plans. Granted, ten and fifteen years is a long way away. However, if both of you don’t have the same aspirations for long-term success, then it’s best to find out now before it becomes a bigger problem later.
Working Well Together
Ultimately, you both have to be able to work well together in all levels of business, which means clearly defining each other’s roles and responsibilities. Both of you need to be clear as to what is expected of the other. Try to play to your strengths. Be honest with one another and state how you see your own strengths and weaknesses. The focus is to find synergies that will simplify how you interact and work in different capacities.
Having Agreements in Writing
There will be times when you’ll need to come up with some kind of contractual agreement, one that clearly outlines the liabilities and responsibilities for both parties. Will your partner sign such an agreement? Better yet, are they willing to put it in writing? It shouldn’t be a hassle to get them to sign a written agreement about important issues affecting you both. If they aren’t willing to do this simple step, then you may not have the partner you’re looking for. It might be necessary for you to hire a business law attorney to help work out the details. Firms like Carter West in Sacramento specifically specialize in agreements and partnerships and can help meet both side’s arrangements.
Agreeing on Financing
Both companies should have the same money management principles and philosophy. Both of you must come to understand and appreciate each other’s position as it relates to how your business will manage cash flow, how it will finance its day-to-day operations, and how both of you will manage finances for the company as a whole. This includes being on the same page as to your monthly, quarterly and yearly expenditures. Make sure you have a plan for finances in the future and where money will be spent and saved.
Success with a business partner ultimately comes down to both of you understanding each other’s position. You must have similar long-term goals and objectives, work well together, resolve disputes, and most importantly, agree on how best to manage finances. Partnering up can be nerve wracking not just as a business owner, but for employees as well. Level with all your departments what to expect and what their part will be in the new venture. When you’re well prepared and have a plan with a new business a new partnership should be easy to manage.