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southernlawn1
02-17-2002, 04:55 PM
:blob3: I have a partner we work together well, But I'm confused on how we should pay each other. Should we keep enough money in the co to just pay the bills and pay ourselves the rest or should we keep the money in the co. pay ourselves a little and try to pay off the equipment. My partner and myself have a full time job as police officers and as of now we do not have any employees. Do any of you have partners and if so do you have any advise.

PAPS
02-17-2002, 06:47 PM
I don't have any partners, but what you should do is set a salary for both you and your partner and pay that salary to yourselves weekly or bi-weekly. Pay yourself as if you are just an employee of "the company" you guys created.

bruces
02-18-2002, 12:56 AM
Develop a business plan, a budget, agree on how much you are going to pay yourselves.

How much money do you need to keep in the business?

What are your equipment needs in the future?

Sounds like you and your partner need to set down and do some serious planning and budgeting. If you pay the bills and pay yourselves whatever is left, what happens if business slows down or someone doesn't pay on time, you guys don't get paid?

You really need to work those things out up front and develop a business plan, including budgets.

The time invested will be worth it in the long run.

LawnLad
02-18-2002, 05:54 PM
SouthernLawn - you raise a very good question, and one that you and your partner will need to agree on now... not later. Also, whatever you agree to - you'll want to put in writing and sign it.

A couple of questions for you - since the answers to these will affect my answer(s).

1) What is your legal structure? S Corp? Partnership? Sole Proprietership and one or the other of you work for the other?

2) Do you have written job descriptions and job duties?

3) Will you pay yourself salary or by the hour?

4) What if one partner puts more time into the business?

5) What is your ownership split? Who is ultimately accountable/responsible for the business? Or are you 50/50?

6) What happens if you can't agree on something? How will you resolve the issue?

7) Will this always be a part time gig or is your desire to grow this into a larger business?

Give me a little more information... I've got a few things that might help you think through some of this. As I have had to deal with the same question you're asking.

Doug