Business Partnership Advisor
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Chris Reich, Business Mediator
5 Red Flags That Say Your Business Partnership is in Trouble
My business partner and I have issues now and then but I tend to just let go and hope they’ll blow over. They usually do and we’ve never had a serious blowout. We’ve had a couple of disagreements in our first year and I hope things don’t get worse. My question is, are there signs that a partnership is in going to have problems later?
Yes! There Are Signs a Partnership is Headed for Serious Trouble
Having dealt with a lot of Partnerships, I’ve seen patterns that tell me when a Partnership is going to have serious issues down the road. Business partnerships can be a fantastic way to pool resources and knowledge in order to create a successful enterprise. However, even the most well-intentioned partnerships can break down if certain warning signs are ignored. In this post, I will point out the 5 red flags that should never be ignored when you see them in your business partnership and provide you with guidance on how to deal with them.
1. Communication Breakdowns
One of the most important aspects of any successful partnership is communication. If communication breaks down between partners, it can quickly lead to misunderstandings and disagreements. This can create a toxic environment that can be difficult to overcome. For example, if one partner is making important decisions without consulting the other, it can quickly lead to mistrust and resentment.
To avoid communication breakdowns, it is important to establish clear lines of communication from the beginning. This means setting up regular meetings, establishing protocols for decision-making, and ensuring that both partners have an equal say in the direction of the business. It is also important to be open and honest with each other about any concerns or issues that may arise, and to address them head-on rather than letting them fester.
2. Different Goals and Objectives
Another common problem in business partnerships is when partners have different goals and objectives for the business. This can lead to conflicts over the direction of the company, and can even lead to one partner trying to undermine the other’s vision. For example, if one partner wants to focus on expanding the business into new markets, while the other wants to focus on maintaining the status quo, it can quickly lead to tension and conflict.
To avoid this problem, it is important for partners to establish a shared vision for the business from the beginning. This means discussing and agreeing on the long-term goals and objectives of the company, as well as the strategies that will be used to achieve them. It is also important to regularly review and revise these goals as the business evolves and grows.
3. Lack of Trust
Trust is another critical component of any successful partnership. If one partner does not trust the other, it can lead to suspicion, resentment, and ultimately the breakdown of the partnership. This can manifest in a number of ways, such as one partner hiding information from the other or making unilateral decisions without consulting the other.
To build trust in a partnership, it is important to be transparent and honest with each other. This means sharing information freely, being accountable for your actions, and following through on your commitments. It is also important to establish clear boundaries and responsibilities, and to respect each other’s expertise and opinions.
Ignoring the red flags in your business partnership could lead to a total breakdown later.
— Chris Reich, Business Partnership Mediator
4. Unequal Contributions
I’ve written on this subject before. Partnerships work best when both partners are contributing equally to the success of the business. However, in some cases, one partner may feel like they are doing more than their fair share of the work, while the other partner is not pulling their weight. This can lead to resentment and tension, and can ultimately damage the partnership.
To avoid this problem, it is important to establish clear roles and responsibilities from the beginning. This means defining who is responsible for what tasks and setting up systems to track progress and ensure accountability. It is also important to regularly review and assess each partner’s contributions to the business, and to address any issues that arise.
5. Incompatible Personalities
Finally, sometimes partnerships break down simply because the partners have incompatible personalities. This can manifest in several ways, such as one partner being overly aggressive or domineering, while the other is more passive or introverted. In some cases, these personality differences can be complementary, but in others they can create a toxic environment that is difficult to overcome.
To avoid this problem, it is important to choose a partner whose personality and work style complement your own. This means taking the time to get to know each other before entering into a partnership, and being honest.
Partnership are like other close relationships. When we get enamored with someone, we overlook the red flags that signal “trouble ahead”. That’s normal human behavior. But, when your eyes open and you see the problems, remember this: these issues erode respect, and underneath the veneer of respect is anger and resentment. Once you get there, it’s much hard to rebuild the trust needed to regain respect.
“If you spot any of these red flags in your business partnership, deal with them ASAP before they lead to a blowout that could end the Partnership.”
Chris Reich, Business Partnership Mediator
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