5 Steps to Forming a Business Partnership
Entrepreneurship is a field where the right partner can open new doors and change your life. Finding the right person can be a long journey, but it is worth it. But before you decide to embark on this journey, you need to know how to form a business partnership. Jordan Sudberg explains how.
“There are many definitions of partnership in the business world, and they vary depending on someone’s perspective. For this article, a partnership is an agreement between two or more people that binds them together to make a venture profitable. So before you form a business partnership with someone else, you need to ask yourself some questions about what kind of relationship you both want.”
Five steps to forming a business partnership:
Brainstorm with your partner about the strengths you both bring to the table. Be frank with your partner, so they know exactly what they are getting into. It may be a good idea to write down everything you want in your business so it is clear. Write down 5-10 things you want to accomplish in the first year of your business, five things you want to accomplish in the next year, and five things you want to achieve in five years.
If your partner wants you to give them your idea, they are probably not a good fit as a business partner. Ask them into the partnership if they want to be there for the long haul. Negotiate with them, find out their interest level in working with you, and see if you can cooperate. There are ways to strike the best deal for both of you, so don’t sell yourself short by just going for the lowest amount you can get away with. You have much more to offer than just money.
3. Consider what you bring to the table
What do you want for your business? How much money do you want to earn? How much time do you have to put into the business? Are you willing to work long hours or want it done from home? Jordan Sudberg says, “If you want to form a business partnership, then you need to decide how much you are willing to invest. If your partner is going to invest money into the business, then you need to consider what kind of investment they will be putting into it.” “You want a partner who has their head on straight, isn’t reckless with their money, and doesn’t want to take unnecessary risks.
4. Make a plan
Now that both of you have agreed on how the business will start and where it will end up, make a plan and stick with it. Both of you should help develop this plan. However, you may see that you cannot work together on developing a plan. If this is the case, then only one of you needs to develop the plan. Do not forget that you don’t need to be a perfect business partner or have the same goal. It would help if you worked together to come up with a plan that is realistic yet achievable.
5. Work out the details
Once you know what your business will entail, it is time for the details. Think about how much help you need and hire the people who are suitable for the job and can do their job promptly. Delegate tasks if possible so that each person can grow their skills and help each other learn new things.
Each step is a bit like going through a building block, so work through each step and not just jump into the next one.