If you are interested in establishing a small business under the partnership with another person or you already own an enterprise, and looking to partner someone into it, you need to get a legal partnership agreement. A partnership involves two or more people who get into the business together and share the profits and losses equally. It is quite easy to set up a partnership venture, and it is also the most popular form of business.
A legal business partnership agreement is necessary as it plays a vital role in unfortunate situations such as loss in the business resulting in bankruptcy and death or resignation of one of the partners. In such cases, the partnership has to be dissolved, and a dissolution agreement is needed. However, the business can function as before with change in its structure. In a partnership business venture, all the partners are legally responsible for any loss or debt in the business. Due to these liabilities, it is recommended that you create a proper partnership contract.
In order to set up a partnership agreement, you have to follow several suggested steps. Only if you carry out the steps mentioned here, you can enjoy the benefits involved in a partnership business to the fullest extent.
First, create an effective business plan and enter into a legal partnership agreement. You can find standard documents for the purpose online. Open a bank account for your business and have your finances worked out efficiently. If required, obtain a business license to run the business legally, and register for the taxes that are involved. Also, consider the insurances that you need for your business.
Once you have planned to start your business, you will know that it is very important to frame a business plan. After realizing this, you need to get started with the plan. The plan has to cover the major areas of your business in a brief way. Let’s take a look at the five sections of a business plan below.
Executive summary: This section will be the first one in your business plan, but it has to be written at the end as it summarizes the contents of the plan. It should be comprehensive as well as well written. It might sound a bit difficult, but it is not. Make sure you go through the entire business plan before you write the executive summary highlighting the important points.
Company overview: This section of the plan will detail the guiding force of your business. It will replicate what is in your mind about the business and how you intend to reach that place. The overview will have a mission statement, objectives and goals of the business.
Business environment: This will require some research as it involves the information about the industry, market, and competition. Stay cautious and attentive while writing this section as it needs a proper analysis of the structure, trends and barriers involved in the business.
Company description: Here, you will have to get into the details of your business. You can write what will sell or serve, the resources that will be used, the types of employees your business needs, the type of distribution method that is needed and more. These factors form your company. The company’s USP is also important.
Action plan: This section outlines the steps that you will have to take to make your business plan function the way it is intended to. It should reflect the objectives and goals that have been mentioned in the company overview.