5 Reasons to Operate Your Business As a Partnership
Starting and growing a business is difficult for anyone but you can cover more ground and improve your chances of success by joining up with the right person and operating as a partnership. If you are thinking of starting a business but cannot decide if you should go it alone or work together with someone else, this article will help by discussing the five most important advantages you will have if you start out with a partner.
The first reason you should consider hooking up with a partner is because two people working toward a common goal can accomplish more than they could as individuals. The reason? Each person has skills and talents and areas of interest the other person does not. If the partners recognize and exploit this, they will find themselves accomplishing more than even they thought possible.
The second reason you should take on a partner is because if you find yourself with a great idea for a business but without the necessary capital to get started, having a partner who contributes an equal amount will double the funds you have to work with. This might turn out to be the difference between going under or surviving that critical cash flow problem that many new businesses seem to go through after they get started.
The third reason you will want to work with a partner is because two people working together have a much more professional and competent appearance than does an individual. People oftentimes think of a single businessperson as inexperienced and, fairly or not, consider two or more people working together as more of a legitimate business, and one they would rather do business with.
The fourth reason to start a business with a partner instead of going it alone has to do with how income is taxed in a partnership rather than in a corporation. Income from the business flows through to the partners who then pay personal income tax on it depending on the bracket they are in. This, of course, depends on a number of factors such as income level and expenses and other deductions, but it can make quite a difference in the amount of total tax you pay.
The last reason to operate as a partnership can be summed up in one word – motivation. There will be many times in the beginning stages of running a new business when you will question your sanity and ask yourself what you were thinking. It might be money, or the lack thereof, it might be what seems like endless hours of work when you don’t see your family or the inside of your eyelids, or it might be any of a thousand problems you will face day after day until you get established. No matter what makes you discouraged, it helps immeasurably to have someone around who can motivate you when you are down.
Starting a business might be one of the most difficult things a person can ever do in life, but if you can make it past the beginning stages until you become profitable and stable, you will enjoy rewards, both tangible and intangible, far beyond what someone who works for others will ever see, and working with the right partner from the start will help you get there faster.