Getting into a partnership can boost the business’ investment portfolio while spreading out the liability should things go wrong. However, business partnerships come with their share of challenges too. One of these is disputes among partners.
While there are several successful business partnerships out there, it is important to understand that disputes are a normal occurrence in these arrangements. However, disputes should never mean the failure of the partnership. That said, here are three tips you can use to mitigate partnership disputes.
Put it down in writing
If you are planning on getting into a business partnership, it is important that you start off by creating a partnership agreement. Among other clauses, a partnership agreement should specify how conflicts will be resolved. Will a committee be formed to address the matter? At what point will third parties be involved? Still on the conflict resolution clause, it is important to include the circumstances that may lead to the dissolution of the partnership or expulsion of a partner.
Keep it civil
Sometimes, it is possible to see a dispute from a distance. If this is the case, it is important that you remain as civil as possible so you can focus on addressing the impending conflict in the most professional manner possible. Keeping your focus on finding solutions rather than discussing the problems can help you resolve the dispute before it can escalate into a full-fledged and costly war.
Do not be afraid to involve a third party
Some disputes may require the involvement of a neutral third party to resolve. This is where the choice of a dispute resolution mechanism comes in. And one of the most effective methods of dispute resolution is mediation. Unlike litigation that may expose sensitive business secrets to the public, mediation is a private dispute resolution alternative that saves both time and money.
Disputes are a given in any business partnership. However, you should never let them distract you from the bigger picture. Find out how you can resolve conflicts arising from business partnerships without hurting your rights and interests.