Forming a new business partnership takes careful consideration to ensure the long-term success of a business. Initial impressions may leave you feeling you have found the best partner to move forward with to create the business model you envision. However, there are essential considerations to make before forming and finalizing a business partnership in Arizona.
Ensure Compatible Values
Like a marriage, business partnerships require shared values moving forward in establishing a business. Though this doesn’t mean you agree on everything, your core beliefs should align so that both partners are ethically and morally on the same page. Also, like marriage, disagreements over money management can be contentious, and these differences can bring successful partnerships to an end.
Establish a Partnership Agreement
If your values align, a partnership agreement is the next most important piece of a business partnership. This agreement will establish the structure of a new business and serve as a guide to many of the decisions that must be made. A partnership agreement can address many common business partners’ disputes, offering guidance and solutions in the heat of the moment when emotions are running high.
Choose a Business Structure
Establishing and understanding a company’s business structure is vital to daily operations. It will demonstrate how a business pays taxes and determine personal legal protection. There are several business structures to choose from, but identifying the one that is best for a company that offers the most protection in the event of significant changes, such as divorce, can offer the security a business requires as partners’ lives shift and change.
Define Each Partner’s Role
Each partner will bring skills to the business to keep daily operations flowing smoothly and ensure its growth. When partners understand the contributions they are expected to make and what duties they are responsible for, then little room is left for guesswork, allowing the completion of essential tasks without assumptions of who should perform in what capacity.
Have a Plan for Mediation and Dissolution
Some partnership disagreements require the intervention of a mediator or a mediation plan to navigate disputes that cannot be effectively solved. Disagreements will happen, but those times when partners don’t see eye to eye do not have to lead to the end of a partnership. Successful businesses plan for the times when challenging circumstances demand neutral assistance.
These disputes between business partners may even lead to the dissolution of the partnership. How this step is addressed is as critical as managing the startup of a business.
And life has a way of taking people down paths they never considered traveling. Family commitments, divorce, death, and a change in direction simply because it is more than enough reason to determine how to end business partnerships when the time arises.
Ensure Trusted Business Partnership Guidance in Arizona
Successful businesses are built on sound legal guidance. The Law Offices of William D. Black have worked with businesses for over three decades to establish the foundation every business needs to survive in a competitive market. Businesses are legal entities requiring the guidance of trusted representation.
William D. Black values your trust, whether you are establishing a large corporation or small business. Schedule a free consultation to build success and protect your Phoenix business by establishing partnerships that last and promote healthy working relationships.