Over the years I’ve heard so many horror stories about family and friendship fallouts when doing business together. It’s like a nasty divorce. People forget why they went into business together in the first place which was most likely because the partners had a common vision about the business. Here are some great tips on how to protect your family and friendships when doing business together.
This could be as simple as a one or two page document that spells out exactly what each person will contribute to the business and what the various roles will be. Be clear on this. It’s always easier to address the terms of the business when everyone is happy, friendly and excited to be in business together.
I run the day to day operation
You keep the books
I make x amount for running the business
You make x for keeping the books
The more clear your arrangement is the better off you will be in the long run. This part can really save relationships. If there is a question about the operation you can always refer to the agreement. You see. This is what we agreed to. Simple.
This is one of my favorite legal forms for setting up a business. This separates the personal liability from the business liability. There are many factors that go into deciding what legal form your business should have. A good discussion is worth its weight.
What if someone wants out of the business or dies or just plain hates running a business with you? The buy sell agreement is a perfect remedy. This spells out how each partner’s exit strategy will work. This again is something that you should decide when everyone is happy. It will save a lot of trouble in the long run.
In today’s day and age these are simple cost effective ways to get your business off on solid footing. It’s not expensive to set your business up correctly and it’s easy to implement. Having these strategies in place from the beginning or at any time that all the partners are on the same page will allow your business to flourish for years and even generations.
A quick conversation is all it takes to get the ball rolling.
Kate's a practicing Attorney for over 20 years. She is a pet rescuer and a strong supporter of pets Rights. Kate expertise is Real Estate, Probate, Estate Planning, Personal Injury, and Business contracts. Kate is happy to discuss any legal or pet matter you may have and if she cannot help; she is more than happy to point you in the right direction. Kate Forte 17 Good Hill Rd Woodbury Ct 06798 Office 203-598-8847 Fax 203-841-1116