What are the Main culprits of partnership failure?

Discussion in 'General Industry Discussions' started by Mr Priceless, Jan 24, 2008.

  1. Mr Priceless

    Mr Priceless LawnSite Senior Member
    Posts: 412

    And on the flipside, what are the main culprits of partnership SUCCESS?:cool2:

    Yes, I've done research on the topic, and a big thank you to all that contributed your knowledge and experiences with partnerships in the past.

    Speaking from my own personal experience, a good friend of mine and I teamed up on the biz to help knock out yards faster. As far as the investment in the biz went i'd venture to guess that about 20% of the time is was me 85% him 15%. But 80% of the time it was about 95% me and 5% him, because my equipment was by far the most often used. Didn't bother me. Whatever repairs occurred most of the time we halved up the bills and later took turns on repair costs or whatever the senario was and we were both fine with it. Whatever income was made was 50/50.

    more to come later....
    but feel free to post ur oopinons
     
  2. br549oicu8

    br549oicu8 LawnSite Bronze Member
    Posts: 1,230

    Words for that partner...
    "HIT THE ROAD JACK.....AND DON'T YA COME BACK NO MORE....."
     
  3. AI Inc

    AI Inc LawnSite Fanatic
    Posts: 25,527

    In this industry , by the time ya split , there isnt a whole lot there.
     
  4. mowing grass 1111

    mowing grass 1111 LawnSite Senior Member
    Posts: 433

    i had a business partner ( brother inlaw) for years and during that 2 years my business grew by 50% .. it worked very well for me. we have talked about expanding this year so he might be coming back in as a partner at a 60% -40% deal..
    if you do anything just dont take advice from someone that has failed at a partnership ...that should be the first sign that they dont know what the hell they are doing
     
  5. jnlenterprise

    jnlenterprise LawnSite Member
    Posts: 7

    First off let me start by saying that almost all 50/50 partnerships fail. The #1 reason is that one of the partners always thinks he is putting out more effort than the other or brings more to the table than the other. I started out my business in a partnership and it wasn't long before I got tired of splitting up the money 50/50 when I was putting in 25% more time, now I am willing to bet my partner thought he was putting as much if not more than me. I would not take mowgrass1111 seriously since his only partnership was with family and to say that taking advice from a failed partnership is bad advice. When I started my partnership our attorney told us from the beginning that 50/50 does not work and that most split up but we thought we had a good mix of experience to prove him wrong. In this business the net margins are low and its tough enough for one person to make a good living let alone splitting up the money. I did learn from the experience, partnerships don't work. If you want a partnership then I would suggest it not be equal, this way you can dictate the way the business grows and goes. Another way to look at it is from a financial stand point, for every dollar you want out of the business your partner gets an equal amount based on the pecentage of his ownership. I did know a company that was very successful with 3 partners (not equals) for a time and they had a great mix, one was an accountant, one mechanical and one from the field. In this case they complimented each other, but eventually it failed for the finacial reasons I laid out. The accountant type wanted to be paid $100k plus and travel but the company could not afford to have 3 owners taking home six figures and they did about 2.5 million a year.
     
  6. Az Gardener

    Az Gardener LawnSite Gold Member
    Posts: 3,899

    I also had a brother-in-law partnership we worked well together and made good money. It did not end up as we set out as far as duties went and I was very frustrated most of the time. Ultimately what split us up was me as I wanted the business to go in one direction and he was more concerned with making money now.

    My business is like one of my children. I don't raise my kids like my brother-in-law raises his, so I guess I should have seen it coming.

    Everyone that is independent enough to start a business is pretty strong willed.
    Not likely to compromise too much especially when your family's livelihood is at stake. I suppose if you have one visionary and one work horse and both are content to keep their roles indefinitely then it could work.
     
  7. Johnson LCO

    Johnson LCO LawnSite Senior Member
    Posts: 336

    I have seen some partnerships fail. It seems that if you are upfront with eachother and arent afraid to communicate your thoughts you should be ok. Partnerships are great if you have a small amount of money to invest because you can pool money, but if you have enough money you should go it alone. My twin bro and I have worked for a landscaper and this will be are first year on our own. As far as decision making and equipment purchases it has gone smoothly but we will see. I think we have a distinct advantage though because we think exactly alike. Make sure you have a thorough written agreement so you can refer back to it in case of an argument.
     
  8. partnership is no different than a marriage, you have to work at both to make it work.
     
  9. Landrus2

    Landrus2 LawnSite Platinum Member
    Posts: 4,833

    Look at it this way want vacation in the summer get a partner:drinkup:
     
  10. mowing grass 1111

    mowing grass 1111 LawnSite Senior Member
    Posts: 433

    try to find examples of a partnership that works i would not take advice from anyone who failed at something so simple
     

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