How To End A Business Partnership Without Breaking The Bank
July 29, 2021
July 29, 2021
Business partnerships are always started in the best of interests. Nobody gets into a partnership to one day get out of it. However, statistics show that up to 70% of business partnerships fail.
This is not surprising since many partners stop seeing eye-to-eye a few months or years down the road. It can be one of the most challenging disputes since not only the integrity and the reputation of your business is involved, but if not done properly, the separation can cost you thousands of dollars.
In most cases, it is almost impossible to determine whose fault it is. Hence, it is best to take the sophisticated route, maintain control and negotiate a fair settlement peacefully and affordably.
In this blog, we have discussed what route you can take when ending a business partnership to minimize monetary loss.
Running a business requires you to make several difficult decisions that not all members of the board will always agree upon. However, as the CEO or a board member, you have to put the interests of the business first. Some of the reasons business partners may start getting into a feud or start drifting away are:
Whatever the reason may be, harboring negative feelings can make it almost impossible to work together. This may also lead to a complete breakdown of the business. At this point, it is important that you protect your interests throughout the ordeal. If you had developed a Partnership Agreement in the past, this might help the process. However, if you have not, reaching a conclusion might be a tad bit difficult.
If you see that you and your business partner are drifting apart, don’t try and keep the relationship going until things get worse. With time small signs can turn into big red flags. If these signs are left unchecked it can reach a boiling point, turning the best of the relationships into the worst. Since at this point, both parties are annoyed, reaching a conclusion is unlikely.
To avoid that and to help ensure an amicable breakup, you need to be able to spot the signs of a failing business partnership before it reaches a toxic breaking point.
If you are spotting noticeable signs such as your business partner suddenly starting to slack off or is not giving the business his or her all, it is important you make the right decision fast. Don’t ignore tensions, disputes, and outright arguments.
It is naive to spend months ignoring tensions, disputes, and outright arguments. It is better to talk things over and make a decision to preserve the interests of both parties and the business.
Most issues between business partners arise due to a lack of communication. Whether you want to try and salvage the relationship or if you want to break off the partnership, keep the dialogue going. Avoid unnecessary bickering and arguments. Try to communicate with each other without feelings of resentment and anger.
Be reasonable and figure out a way to talk things through without having to involve the authorities. You might have to give away a little more if you want to preserve your friendship.
Sometimes, to come to a wise and sustainable conclusion a third party is required. Getting the advice of an independent expert can go a long way in achieving that goal. A third party that has no stake in the business can provide objective advice, which can help limit arguments and resentment.
At Mediation Services we understand the volatile nature of partnership disputes. Our mediation experts have been trained to provide alternative dispute resolution services to help you and your partner reach a conclusion that is beneficial to both.
We offer a flexible, and cost-effective alternative to the long, expensive resolution system that involves the courts and judiciaries. Our mediation services will provide both of you with an unbiased, and neutral mediator who will facilitate a reasonable discussion. For more information about our services contact us.