3 Tips for Succeeding in Business With Your Loved One
by Chico Orange
For nearly all small-business owners, business ownership is a labor of love. Yet running a business with your loved one can bring on additional challenges that may take all the romance out of a relationship.
The challenges that face a typical business owner — working 24/7, operating on tight budgets and wearing many hats — are often intensified when a spouse or significant other is a business partner. Yet many couples have achieved success both personally and professionally working together, and offer lessons that can be applied by all small-business owners.
I’ve had the opportunity to learn from a number of these successful business owners. Here are three tips from working with business couples that I think every pair who runs a business can put in place to help to ensure their entrepreneurial partnership is as successful as their romantic one:
1. Separate your accounts.
For couples who have their personal finances intermingled, it’s important to take the step to separate business finances to avoid confusion and potential headaches down the road.
Business checking and credit accounts that are kept separate from personal accounts can help business owners maintain accurate and complete records of all business-related income and expenses. It also can help keep you both more organized and less stressed.
Also, if business owners might seek future financing, having a separate business account can help demonstrate a strong credit profile and solid business financial information.
2. Build a business plan that defines roles and responsibilities.
When owning a business with your significant other, a business plan can help clearly define roles. For example, your business plan should specifically state who owns the company, the company’s structure, who is on the management team, responsibilities for each role and any additional information that demonstrates your ability to run the business.
A smart way to go about this process is to identify your respective strengths in the areas of leadership and business, and then together determine your roles and responsibilities according to those strengths. The business plan should also list any investors, partners or other people who own part of the business, along with the percentages that each individual or group owns so everything is well documented, on paper.
Every business — big or small, sole proprietor or corporation — needs a plan to ensure it has a strong foundation for long-term success. A well-thought-out business plan is key to helping business owners stay focused on company goals and objectives, as well as track progress.