Choosing a partner for your business venture is not a decision to be made lightly. Your decision to take on a partner may stem from an increased workload, or a desire to bring a fresh perspective to the business.
No matter the reason, it is important for you to consider the advantages and disadvantages of sharing profit and liability with a business partner.
Advantage — Different Perspective
The success of your business may rely on a unique perspective given you by a partner who knows the ins and outs of the business as you do, which gives those in a business partnership an advantage.
Problem-solving is always better with two heads put to the task, rather than just the one, and having a business partner may lessen the pressure with someone else to brainstorm ideas with.
Disadvantage — Too Different a Perspective
The downside to this is that if you consistently find yourself at odds with your business partner, you may yourself held back on the decision-making process as you constantly butt heads.
To avoid this, it is vital to team up on your business venture with someone who has the same mindset and approach as you. Constant in-fighting will weaken your business from the inside out, leaving you vulnerable to outside attack.
Advantage — Capital
Being in a partnership will help you financially. Since you will not be relying solely on your own finances to keep your business afloat, having a partner is an advantage financially.
Splitting every cost in half can only be described as a bonus. And, due to your doubled financial worth, you will find it easier to take out loans as well.
Disadvantage — Shared Profits
The downside to having another person involved in the finances is that you will be able to enjoy only 50% of the profits.
If you feel as though this con may outweigh the financial pros, it would do you well to think twice before entering into a partnership, or at least comb out the fine details with a lawyer before going ahead.
Advantage — Shared Responsibility
This may seem like a small advantage, but there is a lot to be said for having a partner who will help you make key decisions.
The main stress factor in being a business owner can often be the responsibility that comes with it, and having a partner who can shoulder half of the burden will benefit you mentally.
Disadvantage — Lack of Complete Control
Not having complete control over the business is one downside to a business partnership.
If it matters to you that final word will never always be yours, perhaps you should reconsider entering into a business partnership.
Advantage — Mutual Support
There is a lot that can be said for the support that you can glean from a successful business partnership.
The mental and psychological benefits of working with a partner can help a business flourish in ways that working alone could not.
Disadvantages — Shorter Lifespan
You may find your business coming to an abrupt end if your partner decides to pull out, even if you have no issues with going forward.
It is important to find someone who shares your business goals and is willing to stay in the partnership for as long as you mutually agree to.
There are a few options for business partnerships that you can consider, giving you more or less control over business decisions, so do your research before making this important decision.