Partnering in Business

It’s a new year, happy 2021.

I chose partnership as our first business topic for the year. The reason is that
for some of us our goals this year is to partner with other individuals or entities to grow our portfolios / businesses. But often we get carried away by overlooking some important aspects that one need to process prior building the working relationship. It is as a results we see most of the times either the relationship does not last or end with an ugly fight.

I am just here to assist with few things that we need to look into before we even start the work.

1. Please draw a business contract
A contract will provide a guideline of what it is expected of each other in the business. The terms and conditions, responsibilities and duties to be catered by each need to be stipulated accordingly.
Remember you will be investing time, money and skills into the venture. Thus you cannot presume that you know your business partner without first discussing the matter and agreeing to a written definition.

2. Share the same Vision
It is of critical importance that you understand the drive and motivation in the business. Apart from our different personalities and culture we need to find common and solid grounds that will assist in steering the business in the same direction.
For e.g Money and fear of going into business alone cannot be reasons enough to form a partnership. The vision need to be clearly outlined.

3. Is the partnership necessary?
You both need to bring critical talents and resources to the table, which will bring a healthy partnership. How does partnering together make your business venture more successful than if you were to do it alone?

4. Know your relationship
Discuss your key questions about your relationship before the going gets tough, and you will better be prepared to weather the storms of business ownership together. This should be same as knowing each other ‘s personal values. You do not want to learn already within the relationship that your partner is not exactly what you were looking for!

5. How will you measure each other’ s contribution?
When you are feeling the stress of a new business, it’s easy to assume that your partner isn’t pulling their weight. To avoid mounting resentment, define clear and objective performance indicators from the beginning to measure each of your contributions. It will be easier to have a conversation once there is a lack of performance thereof.

6. What financial liabilities does each of you currently hold?
This is important such that you know each other ‘s personal financial liabilities as it will leave an impact on the cash flow, your Income needs and ability to obtain financial assistance – should the need arise.

A partnership should be beneficial to all parties involved thus you all need to structure it properly to avoid unnecessary conflict.

Compiled by Dikeledi Seoloane on behalf of Matsobanemetja Business Consulting – http://www.matsobanemetja.co.za