Howdy, Pard’ner: Making Business Partnerships Work

Business partnershipsTired of going it alone? Wish you had someone to share your struggles and triumphs? Starting a business with someone else, or adding a partner to your existing enterprise, can bring many advantages, including support, division of labor, better ideas, increased productivity, and decreased stress levels. It can also dissolve into disaster complete with tears, frustration, and ruined friendships. Over the years we’ve worked with many dog business partnerships and we’ve seen it all, from beautifully oiled partnership machines to sad disappointment to bitter drama.

Here’s some advice for building the former and avoiding the latter.

Is it right for you?
There are plenty of advantages to partnership. You get to share the workload, ideally dividing tasks according to each partner’s skill sets and strengths. At the very least you have someone to split the icky stuff that no one wants to do. You have someone to celebrate successes with, and to share frustrations and setbacks with, too. You get a brainstorming partner to help solve problems. And when you come up with something new to try, you’ve got someone to share the risk and excitement of any new endeavor. In short, partnership provides built-in support from someone as invested in your business as you are.

But there are downsides to partnership, too, and it isn’t a great fit for all temperaments. If you tend to prefer to do things your own way, you may find giving up autonomy and sharing decision-making a challenge. If confrontation is particularly painful, you may not enjoy the communication necessary for a healthy partnership.

Before you enter into business with someone, sit down for a serious, honest chat with yourself about how the pros and cons stack up for you.

Only fools rush in
If you decide partnership is the way to go, choose your partner wisely. We’ve seen many dog pros eager to rush into an agreement with a dog pro friend or colleague. It’s wise to approach partnership like marriage. After all, this is someone you’re going to spend time with every day for many years to come. You’ll share joint decision making. Your financial situations will be tied together. Given all that, it’s safer to consider a serious period of exploratory engagement rather than an impulsive drive to Las Vegas. After all, ending a business partnership can be nearly as complicated and messy as a divorce.

This is another time for serious, honest assessment. What is driving you toward partnership? Do you feel sure this particular person is the right match for your partnership goals? Consider their temperament in relation to your own, including their feelings about and approach toward taking risks, their communication style, decision making speed, and perspectives on money and how and when to spend it. And what about goals and vision—are you truly on the same page about where to take the business and how to get there? Just as in a marriage, in our experience it’s mismatches in these areas that tend to sink a good relationship.

Sometimes differences can actually be helpful. For example, if you know you’re a bit on the timid side, a bolder partner can help you seize opportunities to move forward. But if you’re not open to that, it’ll be conflict that seizes the opportunity.

While you’re in assessment mode, look also at what your prospective partner brings to the table. What skills are you missing that a counterpart could add to the mix? Perhaps organizational skill, or a knack for marketing or numbers. Or maybe you complement each other service-wise, such as two dog trainers with different areas of training focus.

Keep your eyes wide open
Before you sign binding paperwork, sit down with your prospective partner and hammer out key details. Chief among them are:

Division of labor. What are each partners’ responsibilities in the company? Who is in charge of what? What does accountability look like? What happens if one partner isn’t getting their work done? And, very importantly: What is your definition of productivity? Is it about putting in the hours, or about outcomes? We’ve seen a fundamental difference in outlook on this question cause conflict in a number of partnerships over the years.

Decision making. How will decisions be made in each area of the business? About spending money? About marketing? About which services to offer? About hiring? About how things get done? About prioritizing goals? Will all decisions be shared, or will each partner have autonomy over certain areas? What happens when there is disagreement and consensus cannot be reached?

Profit sharing. How will money be distributed? Will this be based on how much each partner invests? In hours contributed? Based on how much revenue each person generates? Split equally? Under what circumstances can these decisions be revisited?

Spending. How will a budget be determined? How much money will be spent on marketing? How will you decide how much is okay to spend on a new facility or a new hire or a professional service like accounting or business support? What happens when an unexpected expense arises, or a larger intermittent one like needing a new website?

Communication. You must have a communication plan. This is another area that has tanked many a dog pro partnership. First, you’ve got to engage in regular communication about the business. Maybe this is a weekly meeting punctuated by quarterly goal setting, for example. Or maybe you hold a focused monthly meeting supported by quick daily check-ins. Whatever your style, your plan for staying in communication on everything—from big-picture goals to daily protocols—must be codified and taken seriously.

You also have to be willing to actually communicate. This goes back to the temperament question raised earlier—are you willing and able to speak up in a productive way when things bother you, and can you openly hear your partner do the same? As part of your communication plan, make space for these kinds of conversations.

Finally, be social. We hope it goes without saying that you wouldn’t choose a partner you didn’t actively like. It’s important to continue to enjoy each other’s company. You’ll find the challenging conversation easier if you take the time to have a beer or cup of coffee together on a regular basis.

Create a pre-nup
Despite best intentions, things don’t always work out as planned. And life has a way of inserting surprises, too. So your partnership agreement should include provisions for what happens when one partner wants out of the company. Are they to be bought out by the other and, if so, how will the buy-out price be determined? Does each partner have to stay for a pre-determined amount of time to get a buyout? Can a partner sell their “shares” to someone else? What about decision-making power? And what happens should a partner become incapacitated or die?

Don’t go it alone
It is wise to consult with both a lawyer and an accountant when considering these pre-nup questions and also issues around profit sharing. It’s also important to note that the business entity structure you choose (i.e., LLC vs. S Corp vs. straight partnership) may dictate answers to some of the questions we’ve raised here. A business coach can also serve as a supportive mediator in helping to make these decisions, and in setting up structures for decision making, division of labor and accountability, and communication.

Honor red flags
If you take just one piece of advice from this article, let it be this: If you feel any hesitation, if worries are percolating in your mind or heart, if your stomach feels uncomfortable, if there are red flags presenting themselves to you in any way, pull back or at least slow down until they’re fully resolved. Partnership is work to enter into, and quite a bit of work to get back out of. It’s not something to “try out” or experiment with. Don’t move forward without taking the steps in this article and feeling sure it’s the right move for you.

Partnership light
If you’d really love the advantages of a partnership but aren’t ready for the risks or aren’t sure you’ve found your ideal counterpart, put your toe in the water instead of diving in. Read here about marketing partnerships and other ways to add more collegial support to your dog pro work life.