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What You Need to Know When Forming Business Partnerships

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 You can compare a successful business partnership to a good marriage. Both unions require long-term mutual interest and compatibility. They also call for shared values in resources and expectations, goals, and vision.

 It’s worth noting that compatibility doesn’t demand being precisely like each other or agreeing on everything. When forming a business partnership, it’s essential to take care of all details and allow room for some give and take.

Setting Expectations for Business Partnership

Setting expectations is usually not a very easy conversation in business. Nevertheless, it’s crucial to have it as early as possible. The goal is to clarify all the conceivable aspects of the partnership out loud and in writing. A business partnership can’t work if the parties operate on presumptions.

What Is the Motivation of the Partnership?

One essential question to answer before getting into a partnership is the motivation behind it. What does each party hope to gain from the relationship? Why would this be more effective than doing the business alone?

 A healthy business partnership is only possible where there’s a mutual understanding of what each party brings to the table. How does your partner’s contribution support the business? For example, a partnership with Shiply would ease the logistics for a company in the transport sector. 

Responsibilities

It would help if both parties can agree on what they bring to the table. An honest discussion of what each partner can comfortably handle can help prevent disagreements in the future. It’s also essential to be candid about financial responsibilities and all the technical issues involved.

 Agree who will be the leader or the Big Idea Person. This is the more visionary person that will act as the “first among equals.” The other party can take over the execution of plans depending on skills and expertise. 

Agree on a Vision

Nothing can bring a business partnership down faster than not having a shared vision. You and your partner should agree on the short-term understanding of the value proposition. You also need to discuss the long-term picture of how the business venture fits into a global perspective.

Resolving Disagreements

With a business partnership going into the future, the question of ‘if’ you’ll have disagreements doesn’t arise. The fact is that it’s just a matter of time before you both come up with different perspectives on issues.

You must agree on how you’ll make decisions when tensions are high. Would you like to resolve the conflict right away or wait a few days? Are you open to working with a partnership or business coach to navigate the business issues? This is critical and should be part of the initial discussions.

Having a Clear Communication Flow

Most of the time, relationships fail to work due to inadequate or lack of communication. It’s essential to develop a detailed plan from day one on the channels and mode of communication. plan should also outline the elements of communication and the person responsible. 

Final Thoughts

Forming a business partnership is not easy, but it’s possible when the parties know what they want. Having a plan from the very beginning will help business partners avoid the pitfalls that lead to business failure. Whatever agreements and discussions you have in forming a partnership, ensure to put them in writing. 

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