An organization - it is often said - is only as strong as its weakest member. For small business, this holds especially true, as the potential impact of a single partner (positive or negative) is high. To manage this risk, the first step is to fully understand: who are your partners?
Here's a list of key persons that you may consider partners in your business. Depending on how you run operations, some partners may hold more strategic importance than others. Try casting your net as wide as possible by thinking of your business partners as: anyone who stands to benefit (even marginally) by the success of your business.
Co-Owner / Legal Partnership
For many entrepreneurs, joint ownership (a Partnership) makes the most sense. If you are considering going into business with another person (whether best friend, family member, colleague or total stranger......preferably not total stranger) - take the time to properly assess whether or not the 'fit' is right. Consider going into business with a partner as your other marriage in life. Ending a business partnership, much like a marriage, can be stressful, costly and bad for a reputation.
Minority Owners / Shareholders
If you decide to incorporate your business, you might decide to involve additional owners in the business structure. If, for example, you receive funding from an angel investor or other source of funding, you might find yourself with less than 100% ownership of your business. Even though these partners may not involve themselves in the day-to-day operations of your business, their demands and expectations may go a long way in determining the future of your business. Just as children should not accept candy from a stranger on the street, money from investors should also be accepted with caution. Beyond deep pockets, is this a person you want to do business with for the long-term?
Yes, employees do care about the success of your business (assuming you've hired the right people). Employees can be your most valuable partners, particularly when they are truly engaged in their work. Most employees would rather work for a successful company (it looks good on them and ensures a steady paycheque or bonus). Try to bring your employees into conversations around business planning. It all starts with hiring wisely, but it does not end there. Great employees are a rare and valuable commodity, and may require time and commitment to develop - they're worth it. See: Why should your employees like you?
Banker / Accountant / Lawyer
If you don't consider these people to be partners of your business - change them. OK - at the early stages of your business you may not require the services of a lawyer or banker on a regular basis, but it's still never to early to start developing these relationships as you can't be certain when an urgent need will arise. Unfortunately to some, these key partners may seem like adversaries who care more about their bottom line than yours - or neglected intermediaries at best. That may be true in some cases, but for your business to ultimately succeed and grow, you will need their support. Referrals are the one of the best ways to find the right people to work with, so always keep an ear open for new partners. Does your accountant send you a Christmas card?
AKA the 'strategic alliance' or some lesser form of it. Partnering with other companies that have mutual goals is a great way to move your business forward. This might be as simple as allowing neighboring businesses to post advertisements on your bulletin board, co-hosting an event, or as far as sharing a workspace or physical location. Partnering with other companies can help you achieve certain Economies of Scale that might otherwise be impossible for you business alone to achieve. Like with any partner, however, use selection criteria. Consider the image, reputation, financial position and motivations of another company before deciding to partner up.
Let's not forget the people who matter most to us. Our spouses, children, parents and relations may all play a role in supporting a new business. Every business is different in this regard and 'family business' is certainly not one-size-fits-all. As with employees and other business partners, make use of family members when and where the fit is right. Remember: free labour does not necessarily mean good labour. It's great to allow family to participate in the success, but try to avoid unnecessary special treatment. Nepotism in the small business is a dangerous practice, especially if your top (non-related) employees are disadvantaged by it. It's a business after all - not a monarchy.
These are just a few of the stakeholders that you are likely to partner with over the years as you operate your business. Consider making a list of all of your key partners - and then look for ways to strengthen and grow these relationships. For more on this topic, check out the following: