9 Things to Consider Before Forming a Business Partnership

Getting into a business partnership has its benefits. It allows all contributors to share the stakes in the business. Depending on the risk appetites of partners, a business can have a general or limited liability partnership. Limited partners are only there to provide funding to the business. They have no say in business operations, neither do they share the responsibility of any debt or other business obligations. General Partners operate the business and share its liabilities as well. Since limited liability partnerships require a lot of paperwork, people usually tend to form general partnerships in businesses.

Things to Consider Before Setting Up A Business Partnership

Business partnerships are a great way to share your profit and loss with someone you can trust. However, a poorly executed partnerships can turn out to be a disaster for the business. Here are some useful ways to protect your interests while forming a new business partnership:

1. Being Sure Of Why You Need a Partner

Before entering into a business partnership with someone, you need to ask yourself why you need a partner. If you are looking for just an investor, then a limited liability partnership should suffice. However, if you are trying to create a tax shield for your business, the general partnership would be a better choice.

Business partners should complement each other in terms of experience and skills. If you are a technology enthusiast, teaming up with a professional with extensive marketing experience can be quite beneficial.

2. Understanding Your Partner’s Current Financial Situation

Before asking someone to commit to your business, you need to understand their financial situation. When starting up a business, there may be some amount of initial capital required. If business partners have enough financial resources, they will not require funding from other resources. This will lower a firm’s debt and increase the owner’s equity.

3. Background Check

Even if you trust someone to be your business partner, there is no harm in performing a background check. Calling a couple of professional and personal references can give you a fair idea about their work ethics. Background checks help you avoid any future surprises when you start working with your business partner. If your business partner is used to sitting late and you are not, you can divide responsibilities accordingly.

It is a good idea to check if your partner has any prior experience in running a new business venture. This will tell you how they performed in their previous endeavors.

4. Have an Attorney Vet the Partnership Documents

Make sure you take legal opinion before signing any partnership agreements. It is one of the most useful ways to protect your rights and interests in a business partnership. It is important to have a good understanding of each clause, as a poorly written agreement can make you run into liability issues.

You should make sure to add or delete any relevant clause before entering into a partnership. This is because it is cumbersome to make amendments once the agreement has been signed.

5. The Partnership Should Be Solely Based On Business Terms

Business partnerships should not be based on personal relationships or preferences. There should be strong accountability measures put in place from the very first day to track performance. Responsibilities should be clearly defined and performing metrics should indicate every individual’s contribution towards the business.

Having a weak accountability and performance measurement system is one of the reasons why many partnerships fail. Rather than putting in their efforts, owners start blaming each other for the wrong decisions and resulting in company losses.

6. The Commitment Level of Your Business Partner

All partnerships start on friendly terms and with great enthusiasm. However, some people lose excitement along the way due to everyday slog. Therefore, you need to understand the commitment level of your partner before entering into a business partnership with them.

Your business partner(s) should be able to show the same level of commitment at every stage of the business. If they do not remain committed to the business, it will reflect in their work and can be detrimental to the business as well. The best way to maintain the commitment level of each business partner is to set desired expectations from every person from the very first day.

While entering into a partnership agreement, you need to have an idea about your partner’s added responsibilities. Responsibilities such as taking care of an elderly parent should be given due thought to set realistic expectations. This gives room for compassion and flexibility in your work ethics.

7. What Will Happen If a Partner Exits the Business

Just like any other contract, a business venture requires a prenup. This would outline what happens in case a partner wishes to exit the business. Some of the questions to answer in such a scenario include:

How will the exiting party receive compensation?
How will the division of resources take place among the remaining business partners?
Also, how will you divide the responsibilities?

8. Who Will Be In Charge Of Daily Operations

Even when there is a 50-50 partnership, someone needs to be in charge of daily operations. Positions including CEO and Director need to be allocated to appropriate individuals including the business partners from the beginning.

This helps in creating an organizational structure and further defining the roles and responsibilities of each stakeholder. When each individual knows what is expected of him or her, they are more likely to perform better in their role.

9. You Share the Same Values and Vision

Entering into a business partnership with someone who shares the same values and vision makes the running of daily operations considerably easy. You can make important business decisions quickly and define long-term strategies. However, sometimes, even the most like-minded individuals can disagree on important decisions. In such cases, it is essential to keep in mind the long-term goals of the business.

Bottom Line

Business partnerships are a great way to share liabilities and increase funding when setting up a new business. To make a business partnership successful, it is important to find a partner that will help you make fruitful decisions for the business. Thus, pay attention to the above-mentioned integral aspects, as a weak partner(s) can prove detrimental for your new venture.

How to Start an Online Business Step by Step

To start an online business is not an easy task to perform. There are so many things to prioritize in its whole process to make sure that it will bring great results in the end. It needs to be provided with a sufficient and excellent set of investments to make sure that it will be very exciting and really satisfying. But always remember the fact that money is not enough to provide a business with an amazing startup.1. How to Write and Sell your own eBooksAn online business must always be supported with several eBooks that are containing unique contents and useful information for the consumers. Such items can help a businessman to enhance the reputation of an online business more effectively. The best way to write an eBook is to rely on excellent references and to ask for the assistance of a reliable SEO company. Selling eBooks will become much easier to accomplish when conducted in a trusted online store like Amazon.2. Promoting the Business with Social Media Such As Facebook, TwitterA business will never be so popular in the market and trustworthy for consumers if it was not provided with a set of high quality advertisements that are showcasing its set of products and services. Businessmen should always try their best to advertise their businesses more effectively to achieve increased traffic and revenue. One of the most convenient and effective ways to do that is to utilize the power of social media. Create interesting sales pages and fan pages in social networking sites like Facebook and Twitter to promote a business more effectively without spending a lot of money.3. Part-time or Full-time Online Income StreamOne of the most effective ways to fund a business as the time passes by is to rely on the advantages of part-time and full-time online income streams. It’s easy to create a set of special accounts for these online income streams. Such things can really help businessmen to allocate their reserved financial assets more efficiently on the daily needs of their businesses.4. How to Sell eBooks on Your Own WordPress WebsiteAll types of WordPress Websites can be used by businessmen to sell their unique eBooks online without spending a lot of effort. But what is the most effective way to perform this process while aiming to gain higher rate of income? Well, the best answer to that question is to add a PayPal account in a very responsive WordPress website which has an excellent amount of traffic every day.5. Guide To Selling eBooks on Google, eBay and FiverrGoogle, eBay and Fiverr are examples of the most reliable search engines in the internet nowadays. The most effective way to sell eBooks on the stated search engines is to rely on the performance and features of the dependable online stores and sales pages that are available in its search results pages. Mastery of the idea of online marketing and creating several accounts in search engines are included in the list of best strategies that businessmen can use to sell eBooks faster in Google, eBay and Fiverr.6. ClickBank Success GuideClickBank success starts with the process of mastering the uses and advantages of ClickBank in online marketing as an affiliate. It becomes more useful in the process of promoting a business when used to prove to online consumers that the online payment process for the products of a business is totally safe and secured at all times.7. How to Success in Internet MarketingSuccess will never be impossible to achieve in the field of internet marketing if a businessman has a very responsive website to use in the promotion of an online business. A responsive website can provide an online business with a very high rate of traffic every day which can be converted into a huge number of real buyers through a perfect traffic conversion process.

Starting An Online Business – What You Need To Know

If you’re thinking of starting an online business, there are some key issues and areas you need to address to get your dreams off the ground.Why are you starting an online business?
You need to clearly identify your reasons for starting this business. Are you appealing to a gap in the market that you’ve noticed or are you basing your business on your passions and lifestyle? Do you want to establish this business purely for financial gain or to, first and foremost, meet a consumer need or demand? It doesn’t matter which of these reasons you claim as your reason for starting an online business, it’s only important that you clearly identify your reasons and intentions. If you know why you are embarking on this particular journey, you have a greater idea of what goals you will put in place and the direction in which you’d like to be heading. A clear direction will feed into clear goals, and once you establish your business goals, you can construct an online strategy to achieve these goals. At that point on the process, you can then decide whether you want to go it alone or employ the services of an online marketing specialist to really give your strategy some additional drive.Identify your target audience
You need to know your target audience inside and out. Without a clear idea of the group you are marketing to, how will you market your business towards them? Ask yourself questions about your ideal audience: how old are they? What gender are they? What are their likes and dislikes? What problems do they need solutions for? The more you know about this group of people, the more you can target your marketing efforts to entice their business and increase your sales success.An excellent example is analysing the target market of a retail fashion store. It is a boutique store or budget friendly? Is it targeting young females or catering to the needs of tall men? The best way to determine your target market (and thus, how you will market your business to them) is by sitting down and putting yourself in their shoes. Figure out their likes, dislikes, their needs, and so on, and you’ll have a firm base from which to develop an online strategy for your business.Create an enticing website
Unless you’re an accomplished designer, here is when you will almost definitely need to employ a professional graphic designer or online marketer to design your business website. This is a job for professionals because your website design will need to encompass a strong brand image, captivating content, and enticing design elements to tie it all together. More often that not, your website will be the deciding factor in whether prospective customers will purchase from you or make an enquiry – and you have about three seconds to make a positive impression. So copious amounts of text or headache-inducing graphics should be used sparingly, if at all. And remember, consistency is key; whether in the context of branding, font choices, logos, or colour coordination, always make sure you are consistent across all your brand collateral – both offline and online.Take advantage of traffic generating tools
By traffic generating tools, I mean Search Engine Optimisation (SEO) and Pay-Per-Click Advertising (PPC) resources. You can utilise particular keywords relating to your business and SEO tools to push your business’ website listing higher in search engine rankings. More people are likely to click on the first few search results and this gains your business increased online credibility and weight. Search Engine Optimisation is also a practice that is absolutely free to use. Pay-Per-Click Advertising, though not free, is a quick and effective way to get your business noticed on popular search engines. PPC Advertising positions your advertisements in the ‘featured’ areas on search engines and using PPC, you have a higher number of resources to monitor, track, and adjust your advertising efforts. Ever see those sidebar adds that creep up when you Google something? Those are feature ads, and your business could be the next feature.Track, reassess, and refine your processes
Google Analytics and AdWords are paid advertising methods that enable you to keep track of your site rankings, visitor data, keyword performance, and much more so that you can pinpoint the successful and underperforming aspects of your marketing and advertising campaigns. You can track this information down to the smallest detail and modify elements of your efforts to achieve short-term goals quickly and efficiently. And I do mean down to the smallest detail; you can monitor which keyword is the weakest link in your efforts, how many clicks your links get on any given day, and how quickly people bounce back from your site. All of this information is exceedingly valuable when trying to build a strong online business.PPC Advertising is ideal for short-term performance goals and SEO is ideal for long-term goals, but used together, they can help your business build online credibility and drive online traffic.These are some essential components you need to consider when starting an online business.