As you start your partnership, you might think that you have everything in order and that it’s smooth sailing ahead. But many partnerships face challenges over time, with some of the more serious partnership disputes threatening the viability of the business’s success and continuation. It’s a scary thought, for sure, which is why you should hope for the best but plan for the worst as you get your business up and running.
How can you avoid a partnership dispute?
The good news is that you can be proactive in avoiding partnership disputes. Here are some effective ways to do so:
- Create a detailed partnership agreement that addresses issues such as each partner’s role and obligations and how conflict will be handled.
- Utilize a decision matrix that provides fairness in the decision-making process.
- Gain a full understanding of your partner’s values and goals before proceeding with your business while also revisiting those matters from time-to-time.
- As you create your partnership agreement, try to account for the worst-case scenario.
- Try to head off problems early before they expand into something that’s harder to control.
- Keep lines of communication open, even when difficulties arise.
- Maintain a professional approach to conflict and avoid making disagreements personal.
- Don’t be afraid to seek out alternative dispute resolution, such as mediation, when needed.
Set yourself on a path to successful business formation
You can do a lot on the front end of your business’s formation to protect your long-term interests. To do so, though, you need foresight and an understanding of the types of issues that you might face over time. By reading up on issues like partnership disputes, you can gain the perspective you need to make the fully informed business decisions that are right for you and your company.