Business Partners – The Pro and Cons of the Relationship
However, just because you need a business partner to make your ideas a reality does not mean that it will be a walk in the park. Despite the possibilities of challenges, however, the benefits often make them worthwhile.
Like any opportunity you take to add people your team, you should understand the pros and cons of the relationship. This will allow you to make informed decisions about whom to bring on, and help you know if what you are experiencing is normal as the relationship progresses.
Business Partners – The Pros
The number one reason to bring on a business partner is that they can offer something to the venture that you cannot. It might be:
- Money – Funding for equipment, inventory, hiring a team, renting/buying location, etc.
- Business Idea – Ex: you have the skills to develop an app, and they bring the perfect app idea
- Business Knowledge – They have run a similar business before and can guide you or has a currently lacking skillset
- Time – They have the time to use their skillset to complete or assist with the needed work
Bringing in the missing pieces often allows you to reach success levels that are not possible on your own.
Two heads can be better than one when it comes to brainstorming new ideas or coming up with a solution to a problem.
Having a partner allows you to brainstorm with someone who has a different perspective, skill set, and knowledge base. This not only gives the opportunity to have different ideas brought to the table but also gives you someone who will challenge your suggestions. When ideas are tested, you often dig deeper which allows you to validate the merit of the plan or see why it’s not the correct path at this time.
Shared Workload and Responsibilities
It takes a lot of work to start and run a business. When you have a business partner, you have someone to share both the workload and the responsibilities.
You do not have to do and be responsible for the completion of it all. Someone else who is equally accountable for the success of the company can share the workload and more importantly the responsibility of the tasks.
Procrastination and lack of follow-through can plague an entrepreneur. As much as you want to get things done, competing priorities and overwhelm can get in the way. Having a business partner can help hold you accountable when it comes to completing essential and forward moving tasks.
In turn, you can hold your partners accountable to ensure that the business is moving forward on the agreed upon timeline.
Business Partners – The Cons
Complicates Personal Relationship
The number one con of having a business partner is that is can it can severely impact the previous relationships you had with that person.
Running a business is stressful, and when not handled properly, some relationships cannot make it through the challenges. Going into business together has ended the best friendships and even relationships with significant others and family members.
You will never see eye-to-eye with your business partner 100% of the time. Conflicts will occur at some point during the relationship.
When disagreements are not dealt with appropriately, they can lead to a strain on both the partner relationship and ultimately the business.
Loss of Control – but responsible
When you bring in a business partner, you are giving up a part of your business. While this means you have someone to share the workload and responsibilities, there is also a downside – You are also giving up some control.
The business is no longer 100% yours, and therefore neither is the decision-making power.
However, you are still responsible for the outcomes of all decisions. This means if a business partner makes an excellent choice, you’ll profit. However, if they make a poor decision that negatively impacts revenue or breaks the law, you also lose.
Not the Right Fit
Finding the right business partner can often be a challenge. While it might seem like the perfect connection before you join forces, things might come to light after. Maybe their work ethic is different from yours, or perhaps they are not as skilled as you believed.
Once you bring on a business partner, however, it’s not always easy to end the relationship. This leaves you with someone who might not be the best fit for the company or its goals.
How to Reduce the Negative Impact of Having a Business Partner
The best way to reduce the impact of the business partner cons is to create a strategy designed to help you get through the hard times. Ideally, This strategy should be created before problems start and will help create an environment that allows for more open communication and feedback.