Poor choices can ruin busi­ness part­ner­ships

The Times Herald (Norristown, PA) - - BUSINESS - By Joyce M. Rosen­berg

NEW YORK >> Nearly a year af­ter Court­ney Jack­son launched her cloth­ing busi­ness, she took on a part­ner to help man­age the com­pany’s growth. A month into the part­ner­ship, some­thing was wrong.

Jack­son’s part­ner was sup­posed to han­dle half the com­pany’s work­load, but that didn’t hap­pen. So, Jack­son be­gan tak­ing on more of the re­spon­si­bil­i­ties. When Jack­son tried to dis­cuss the divi­sion of work, “she was a lit­tle de­fen­sive at first, and asked me to be pa­tient.” The sit­u­a­tion didn’t im­prove, and they agreed to part at the end of last year, just three months af­ter the part­ner­ship be­gan. But un­der their part­ner­ship agree­ment, drawn up with­out an at­tor­ney, di­vid­ing the com­pany’s as­sets would have weak­ened it fi­nan­cially. The part­ners de­cided to close, and Jack­son lost her com­pany.

The fail­ure of a part­ner­ship of­ten brings hard lessons for com­pany own­ers. Prob­lems of­ten start when prospec­tive part­ners don’t think through all the ram­i­fi­ca­tions of what they’re do­ing — in­clud­ing whether they’ll be a good fit. They may not be clear on their ex­pec­ta­tions for each other, and how they’ll re­solve con­flicts. And they may not con­sider the le­gal con­se­quences of how they set up their part­ner­ship, and how dif­fi­cult it might be to un­wind it; rather than hire an at­tor­ney, they write their own agree­ment that can be prob­lem­atic when the re­la­tion­ship turns sour.

Jack­son’s ex­pe­ri­ence taught her that she needed to be more strate­gic in her busi­ness de­ci­sions. And in choos­ing a part­ner — Jack­son had met hers through a mu­tual ac­quain­tance,

“You need to make sure you know the per­son well enough to

CHOICES >> PAGE 2

CHRIS O’MEARA - THE AS­SO­CI­ATED PRESS

Court­ney Jack­son poses for a photo in her home of­fice in Val­rico, Fla. Nearly a year af­ter Jack­son launched her cloth­ing busi­ness, she took on a part­ner to help man­age the com­pany’s growth, but just three months af­ter the part­ner­ship be­gan it ended.

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