I recently wrote a post: Taking on a Business Partner and I would like to take it a bit further and share 9 questions you should be asking before taking on a business partner.
Going into business with a someone is a lot like getting married. It’s legally binding, requires a lot of work to maintain the relationship and when things go bad, like they sometimes do, they go REALLY bad. So just like with personal relationships it’s important to know as much as you can about a potential business partner before signing any kind of agreements.
Here are the questions:
- The first question to ask is one to ask yourself – WHY do you want/need a business partner? Search deep and find out the real reasons why you are thinking on taking on a business partner. Are you coming to realize that your business is in need of someone who is comfortable talking to strangers or a crowd because you are a major introvert? Do you need someone who is better managing finances because you are a bit of a spendthrift? Realize that the person you are looking for needs to be someone who compliments you – which also means someone who is not just like you. THAT may lead to disagreements that you need to be prepared for. What will you do when your new partner starts to do the very things you took them on for but turn out to irritate you? Know yourself and your reasons for wanting a partner before going any further.
- How much time will you each spend on the business? It’s not important that you each spend the exact same amount of hours on the business each week but it is important to know what the expectations are before you begin. If you are expecting your partner to put in 40 hours, but they really only have 20 there will be conflicts. Best head them off and know up front how much time each of you have to spend working on the business.
- What is his/her financial situation like? Are they paying for a huge house, a single parent or paying child support? If your candidate has huge personal expenses they may not be able to live on the income your business provides at this time.
- Might your potential partner have family issues that could make the business take a back seat? Do they have obligations to family, like an older live-in parent, or an un-supportive partner that are likely to make them less committed to the success of the business?
- How committed to the success of the business is your partner likely to be? You need to feel that the candidate has as strong of a commitment to the success of the business as you do. The answer to this question may found in your “gut” as well as some fact finding.
- What questions might he/she have for you? Your potential partner should be asking questions of you that are as tough or tougher than the ones you ask them. If he/she has no questions for you, you may want to see that as a red flag. Either they aren’t interested enough or they making assumptions – both are bad for the partnership in the long run.
- How would your partner handle tough situations? Share some of the troubles you’ve had with customers or clients in the past or ask about some tough situations he or she have already dealt with. Asking how he/she would, or did, handle it will help you to get a feel for how he/she may handle tough situations. .
- What do other people think of your candidate? What do fellow community members, church goers or tradespeople think about your potential partner? Are they well liked and respected?
- Are they willing to sign a contract or agreement? It’s very important to outline expectations for the relationship you are about to enter. It will give you both a higher standard to hold yourselves to when you’d rather slack off a bit and it also gives you documentation to refer to if a disagreement does arise. When drawing up your agreement be sure to include options for if things don’t work out well. How will you split without losing everything you’ve worked so hard for?
And now you may be asking yourself if you really do want to take on a business partner. Don’t let fear hold you back from something that could potentially give your business a HUGE boost. Just be sure to go into it with eyes wide open and fully aware of the pros and cons.
Have you ever considered taking on a business partner? What questions might you add to this list?
By: Vicki O’Dell, The Creative Goddess
You can find more of Vicki’s article right here on her profile page!