You enjoy being your own boss, but it’s a lot of work to handle alone. Therefore, you might have considered bringing on a business partner or two. If you opt for a business partnership, you have to follow the rules outlined in the Tennessee Uniform Partnership Act.
Here are the pros and cons of collaborating with business partners.
Pros of business partners
Working with one or more business partners has many perks:
- Operating a business with others lessens your burden: A business owner has to deal with things like marketing, commercial rent fees and maintenance. Instead of juggling these tasks yourself, you can split them with your partner(s). For example, one person could focus on advertising while another could handle customer service.
- A business partnership grants you tax advantages: Even though each partner in a business is required to report their profits and losses, there are a number of tax advantages that come with working together.
- You can brainstorm ideas: Let’s say you’re interested in increasing revenue for your business, but you don’t know where to begin. You and your business partner(s) can bounce ideas off each other to conjure a creative solution.
Cons of business partners
Sometimes, having business partners doesn’t work out well:
- You and your partner(s) might struggle to agree on certain business matters: Maybe you and your partner constantly argue over issues like whether a website or social media page is best for your business, or one accuses the other of laziness. These disagreements could eventually lead to a breakup and result in business closure.
- You have to divide the profits: Depending on how well your business is doing, you might not earn as much money as you hoped. Your cut could be much smaller since you have to share the profits with your teammates.
Running a business with friends or family members can be fun, but it has its challenges. Seek out legal guidance if you have any questions regarding business partnerships.