There can be many benefits when it comes to going into partnership for a business. Two minds means more ideas for your business and the potential to grow even more. If the partner is a close friend, it can also be fun to work with them. Partnerships tend to be quite popular in corporate and professional service businesses.
Unfortunately, there can also be downfalls when getting into partnerships. Even if the partner is someone that you trust highly, disputes can be rather unexpected in business partnerships. They can be so bitter that they can put the business at great risk unless the dispute is resolved quickly.
There are ways that you can prevent the partnership disputes happening altogether in the first place. It will require some patience, investment in time and some money. Here are some strategies to consider to avoid getting into any future partnership disputes and prevent the risk of your business.
File a contract
One of the assured ways that you can prevent any conflict or dispute happening between you and your partner is by putting agreements in writing. Filing a contract on agreements and terms of conditions of the partnership can provide clarity and structure for your business proceedings. The agreement should include some important factors including:
- The percentage of control in the business
- The roles of each partner
- Compensation
- Structure of how final decision making is made
- How circumstances will be handled when unexpected disputes arise and requires change in partnerships
- How termination of business partners can end
This contract should be in writing and kept confidential between the hierarchy of the business. It will outline the important aspects of the business in terms of how it runs and the roles of the senior members in the business.
Gain professional help for partnership operations and agreements
Whilst two heads being better than one can be beneficial in a business aspect, sometimes you may need external help when it comes to arranging legalities on the agreements. Some business owners tend to prefer to draft the agreement themselves. This can be mainly down to saving time and money, but it’s ideal to seek professional help instead.
The first reason for this is that all businesses operate differently. Following a generic template that you’ve found online can easily miss off more important aspects of your personal business. An agreement should be catered to your own preferences and business partners. A dispute resolution solicitor can help to draft this up and ask all the right questions to ensure every aspect of the business is covered.
Another reason is that it can save you money in the long term if something was to go wrong. A solid agreement contract means everything will be covered, whereas one you’ve drafted yourself could lead to disputes occurring in the future and becoming a costly expense.
Take the time to discuss the resolutions to your dispute
If disputes do happen to occur between you and your partner, rather than discuss the problems you should choose to think about the resolution. There should be time taken out during the busy work schedule to organise a meeting where positive discussions can be had.
There are many distractions and tasks during the day which makes conversations unproductive and come to no resolution. Instead, you should sit down together and come up with a resolution to the matter rather than argue about the problems. The goal of the meeting should be to work together to find a conclusion, rather than ‘beat’ your partner in the discussion.
Put across why your particular resolution will work, providing clarity on how it can solve the dispute and why it will be beneficial for both parties. This will create a vision where both partners can set out to achieve the goal and resolve any conflict that you have.
When you have a dispute with your partner, it can not only affect your business partnership but also your personal relationship and the business itself. You should put together a strategy that will prevent disputes from happening and also help to resolve disputes in quick fashion.
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