Have you heard of - or experienced - a business partnership ending badly?
Generally, only two of 10 work - one very well, and one is just okay.
Often the failures are a result of each partner's expectations of the business. Everybody has differing visions, targets and what they hope to achieve in the business. Conflict can arise in the partnership when one partner wants to go faster than the other, one partner wants to take it easy, or one partner has a higher appetite for risk than the other.
This can mean that a couple of years on, one partner is working a bit harder than the other and resentment builds.
Or, the business needs a cash injection and one partner has the money and the other doesn't. Or, one wants to invest time and money in going after a new contract or market share, while the other is happy with a steady, reliable business. That's when problems start.
The trouble is there is so much emotion and excitement in starting a new business that the partners often didn't talk about these kinds of issues before they got started. Successful partnerships needs clear communication and a lot of what-if planning.
What if:
• one of the partners wants to leave the business? How will you manage buy out?
• you suddenly need capital suddenly? Whose personal assets will and will not be available?
• each defines business 'success' differently? Is there a particular milestone you each want to reach?
• you disagree on the lifespan of the business? Do you intend to sell it? Run it forever and keep it in the family?
• you disagree on 'comfortable' working hours? Will this change after the first few years of intense work are over?
• you have different expectations regarding financial return - now, and ultimately? If you each have different skills, do you value your time equally?
• you have differing coping levels regarding losing sleep over personal or business debt?
These are the kinds of questions you need to discuss - and put in writing, to form the basis of a successful partnership. When you're working together, you need to know what to expect from one another. If you can see from this exercise that your expectations are not aligning on a lot of points, then you may need to consider other options rather than going into partnership.
Submitted by Patrick Greenaway of ActionCOACH KZN.