9 Questions to Ask a Prospective Business Partner Before you Team Up
Want to get more work done than you can manage, but you can’t afford to hire? Perhaps it’s time to take on strategic business partners.
One of the main reasons people start their own business is to be their own boss. As business owners, we like to do things our way and often are happy doing this solo. But you can only get so far on your own. It’s hard to reach the same heights of success that can arise when you collaborate with others. Collaborating doesn’t always come naturally especially when you are used to doing it for yourself and by yourself.
For many business owners the thought of having a business partner & sharing control is terrifying.
Like personal relationships, everyone has heard disaster stories where a partner ripped off the business or didn’t pull their weight. The thought of potential disaster stops us taking a chance with another. But imagine if we could reduce the risk of it not working? You can.
Collaboration doesn’t have to be permanent and there are factors to consider that will improve your chances of choosing the right partner to collaborate with.
Here are nine questions to consider before diving in.
1. Do you have different and complementary strengths?
The best collaborations make two a much stronger option than one. Make sure that your prospective business partner is bringing different strengths to your operation. Maybe they have expertise in an area that you don’t which is beneficial to your customers.
2. Do you have a communication channel you both prefer?
To collaborate successfully, communication is important. There is nothing worse than when someone in business insists on communicating through a method that just doesn’t work for you. For me, it’s text. I can’t stand using text. You may feel the same way about direct phone calls and prefer that people email you. It’s vital that when choosing someone to collaborate with that you can agree on a communication platform that works for both of you.
3. Do your values align with your prospective business partners?
What’s important to you in business? What values do you hold dear? Are these shared by the other person? In particular, consider the level of customer service you provide, where you stand on whether the customer’s always right and what other similarities or differences exist in your respective work ethics.
4. Are you equal in reputation?
If you have a good reputation it might be important to consider someone who has a similar reputation. If you are just starting out in business this may not be as important. However, it is helpful to do a bit of online background research to see if there are any reputation red flags.
5. Have they had successful experience in collaborating?
To be good at relationships both personal and business may take practice and skills. What evidence is there that this person has been successful working with others? Even knowing that they haven’t had experience can help you navigate the collaboration more easily.
6. Do you both have clear goals for collaborating?
Is each party clear about what they want to gain from the collaboration? Do you both have a ‘why’ for the relationship? The more clarity you have around why you want to collaborate the more successful you will be.
7. Is there a time limit on the collaboration or a natural end point?
In business, having a succession plan is helpful from the outset. Likewise, having an idea of when the collaboration may end before you enter into it can also be beneficial.
How long do you need to stay together to be considered loyal? When will you know it’s time to end the collaboration?
8. How long have you both been in business?
Business experience and length of time spent running a business can be an important factor in choosing a collaborator particularly if there’s finances or financial risk involved. The more experienced someone is in business the easier it will be to navigate a relationship with them.
9. Do you like each other?
There’s no point in teaming up with someone you don’t really like. Make sure you like them as a person as well as the way they do business.
By considering the above as something of a pre-partnership checklist, you’ll position yourself, your new business partners and your business to succeed.
In addition, the implementation of a legally enforceable Partnership Agreement (commonly referred to as a “buy sell” agreement) is a very important consideration in the event that things don’t work out. Need to know more about Partnership Agreements, contact us on 07 3883 8999