How well do you know anyone? Really. Can you honestly say you know someone so well you can predict what he or she will do in any given business situation? If this were the case, there would be fewer breakups in the business world. Even if you did understand another well, this doesn’t mean one of you wouldn’t change as other events unfolded. If you want to counter potentially bad business relationships, the bankruptcy attorneys at Behm Law Group, Ltd., recommend you consider the following steps in the Mankato area:
1) Do a background check on any potential business partners. Your due diligence in this area could avert a Bernie Madoff catastrophe.
2) Have an attorney review any legal documents you use in your business. This review should include any agreements or contracts with another business party.
3) Agree on a code of conduct. How should discrepancies or conflicts be handled? Put this agreement in writing.
4) Determine the areas of responsibility for each party. What happens when one person goes on vacation? What happens when one party interferes in the duties of the other? What happens as new areas of responsibility emerge as the business evolves?
5) What if one party is compromised in any way, legally or ethically? Be prepared to know what you would do in this case.
These five steps should allow you to forge a more meaningful business relationship. At times, it may be best to reassess some of these or other areas as your business develops.
Keep in mind that people can change. Who you thought was a person of sound character may change and almost devastate the business. Installing a system of checks and balances can help to thwart any intentions of wayward souls.
Although it may seem daunting at first, documentation is your friend. It provides clarity and structure to an otherwise fluid relationship. It can minimize misunderstanding and thwart ill intentions.
Let’s face it. If you don’t strive to make your business relationships concrete in the Mankato, Albert Lea, and Owatonna areas, one day you may be looking at bankruptcy because of something your business partner did.