Business partnerships sometimes last a lifetime. However, others last only a few years. Obviously, the partnership will end if the company itself goes out of business.
However, you may want to keep the company open when your partner doesn’t or feel like you can no longer work with your business partner. Rather than giving up on a business you have worked hard to build because of partnership issues, you might want to consider buying your partner out.
Do you already have rules for a buyout in your contract?
Some people think ahead when creating their initial partnership agreement. They address the eventual dissolution of the partnership right when it starts.
If you already have terms set to buy out your partner, you simply have to ensure that you are able to meet those in your current financial circumstances. If you did not address the potential buyout in your contract, you might want to start thinking about determining the value of your business.
How a business valuation helps at the end of a partnership
In order to convince your partner that your offer is reasonable and fair, it should have a basis in fact. You can review your financial records to see how much capital you have. You may have to adjust the value of machinery, real estate or equipment for depreciation.
It is possible that your partner will quickly accept the offer. You also have to prepare for the potential to negotiate. It’s wise to consult with an experienced attorney before you take steps to buy out your partner.