6 Elements of a Successful Partnership
May 21, 2024
Entrepreneurship can be quite lonely. That’s why many entrepreneurs look for partners (a friend, a relative, a colleague, or someone they can fully trust) to do business together.
Having a successful partnership means you have someone to bounce ideas and share the risk with. But also, that you complement each other in skills, knowledge, expertise, and business interests. And, of course, that you can support one another during the hard times.
- However, a successful partnership is like a marriage: you commit to it for the long term.
Maybe not forever, but definitely, it's a long-term relationship. That’s why you have to make sure that the selected person is the right partner for you.
If you decide you want to get into a business partnership, there are six elements you need to consider.
Answer these questions to evaluate if the person you are considering, or even the partner you already have, meets those requirements and aligns with you. If not, it is best to have a healthy, positive discussion to redirect the partnership and turn it into a very prosperous relationship.
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1. Do you both understand the business?
The biggest issues in partnerships come from either issues with money or unfulfilled expectations. And the unfulfilled expectations come from not understanding the franchise business they are getting into.
Every industry and every business is different: how you run a food service is completely different from how you operate a pet store. Even within the same industry, the brands have specific systems and policies to set them apart from their competition.
So, to be healthy, positive partners, you both need to fully understand the industry and the business, even though you won’t be doing the same things or operating the same business areas.
You also need to understand the financials to be aware of how business works and where the results are coming from. Otherwise, you could always wonder whether the numbers are right or not, and that can cause many misunderstandings.
Keep learning: 6 Key Financial Insights for Multi-Unit Franchisees
Also, you and your partner must be conscious of the work it takes to do each part of the business. This can save many discussions on why things are not done faster or better.
- Together, these detailed understandings will help you have realistic business expectations.
2. Can you both contribute to the business?
A successful partnership also implies that you can contribute to the business in specific and different ways. That is, you bring complementary strengths to the table instead of competing values.
If you both want to do the same things, then you'll have a competition where one person wants to do it their way and another person wants to do it their way. That brings a lot of challenges and disagreements between partners.
3. Do you have clarity on the roles?
Each of you should have a distinct role, attached to the value you bring to the business. These roles within the company should be clearly defined and their responsibilities documented, so there is no confusion on who does what and who’s responsible for certain business results.
And every time something new comes up, like a business opportunity or activity, you need to assign the responsibility to one of you, so that somebody owns those projects and you verify they are not competing or overlapping.
Also, these roles should have metrics of success for those responsibilities to hold each other accountable. These will also help both parties make sure they are contributing the way that they're supposed to be contributing.
Just to clarify. Even though you both will have primary responsibilities with specific metrics of success, that does not mean you won’t contribute to your partner.
- You should have a positive, open, and collaborative relationship because the whole point of having a partnership is that you can do business with someone to bounce ideas off!
While you might be responsible for, for example, sales, that doesn't mean that you could not share your thoughts on sales tactics or strategies you want to implement in the organization. Or that your partner can pitch you some ideas.
Having an open collaboration will help you have a successful partnership.
Don’t miss: How to Overcome the Growing Pains of an Entrepreneur
4. Are you both aligned with the company’s culture and values?
The fourth element to having a great partner is that you are both aligned with the company’s culture and values. If, for example, one of you is focused on growth and the other has operational excellence as a goal, there might be conflicts in the future because both ends pull each other.
When it comes to the culture and values, ideally you should create them together so there’s an alignment between you two. That way, you both agree on your mission, vision, and values, to then define what’s important for the company. That will dictate your priorities, activities, and decisions.
You also should be willing to live on these ideals and drive them in the organization every day. If you're both making decisions based on the same principles and values, then your partnership will be strong and enduring.
5. How is your communication?
Element number five of a great partnership is having great communication. That means you are open to hearing each other's opinions and thoughts and sharing healthy, constructive feedback.
To do that, you need to be generous with what you say and generous with how you listen to each other because people tend to get defensive when something negative happens, and that's not healthy communication. But, if you have that generosity towards yourself and your partner and are open to hearing what they say, you’ll have a positive relationship with them.
You also have to be empathic, especially when you go through difficult situations and the specific challenges of your roles. Issues will happen all the time but if you understand and support each other through that, you’ll be able to nurture a healthy business relationship.
6. Do you agree on the goals and exit strategy?
You should both agree on what are the business goals, whether it is how many units you want to grow, what type of company you want to be, or how fast you want to grow. And also, what options do you have if you wish to exit the franchise business.
If you have those agreements in place, you’ll be able to make decisions and have a strategy rowing in the right direction, together.
- But beware: this is something that you should revise before you even go forward with the partnership.
What if your business partner is also your life partner?
Some of these business partnerships are between husband and wife. That brings a whole new level of complexity because the marriage should, hopefully, be there forever.
When husband and wife partner in business, the elements of generosity, compromise, and communication have a higher impact, and the one regarding the responsibilities and roles becomes crucial.
If this is your case, I suggest you sit down with your significant other every so often to discuss each of these elements, verify if something is bothering them, and give and receive feedback before any issue becomes a big deal.
And if you are the one receiving this information, be open, be generous, be positive, and be present. You can solve the problem by compromising and negotiating to have a positive outcome you can both agree with.
Don’t take this lightly: if you and your couple don’t have these six elements in alignment, the issues will happen not only in the business but in your personal lives. And no business is worth your marriage.
I hope these six elements help you analyze if a future partnership is good for you or how you can make your current business society a much better, healthier, and more positive one.
If that's the case, make sure you subscribe to our YouTube channel, podcast, and newsletter to receive more tips and resources to help you thrive with your business, whether you are going solo or with a partner.
Reflections:
- How much do you and your partner understand about the business?
- Are you and your partner conscious of the other people’s tasks, responsibilities, and expectations?
- How is your communication with your partner?
- What made you decide your partner is the ideal person to do business with?
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