Pros and Cons of Starting a Business with a Friend or Family Member

A large number of men and women dream of starting their own business. Whether that business be an internet writing service, an online store, a clothing store, or a pet grooming shop, starting a business can be difficult. Many individuals are unable to develop a business plan all on their own and come up with the financial resources to make that plan happen. Instead of hiring professional assistance, many individuals look for a business partner.

Business partners come in all different shapes and forms. When trying to find a business partner it has been said that a large number of individuals try and find a business partner that is either a close friend or relative. As with many other important decisions, going into business with a friend or family member has its pros and cons.

Pros

(1) Shared Financial Responsibility – As previously mentioned, starting a business is not a cheap venture. Many individuals cannot start a business without a financial loan and they are not even guaranteed to receive all of the money that they need. This is one of the reasons why a person starting a business decides to find a business partner. In addition to splitting the profits of a business, most business partners also spilt the operating costs.

(2) Trust – Individuals who are interested in starting their own business, but cannot do so without a partner are more likely to select a partner that they know they can trust. This is why a large number of partnerships stem from a previous relationship. Most individuals feel that they can trust a close friend or family member more than another businessman or woman.

Cons

(1) Work Habits – Just because a friend or a family member may seem trusting, does not necessarily mean that their work habits or ethics will be the same. Many individuals in a partnership often see a problem arise in the amount of work one partner does. This is often seen when business partners agree to split profits down the middle. If one partner does more work than the other this often creates tension that sometimes leads to the dissolution of a partnership.

(2) Strain on a Relationship – There are many business partners, which are connected by friendship or family, who have had successful business partnerships. However, not all partnerships turn out successful. There have also been a number of friendships or family relationships that have gone sour due to a business disagreement.

No one can tell you whether or not it would be a wise idea to go into business with a friend or relative. If you are thinking about doing so, the decision is completely yours. To determine whether or not going into business with a friend or a relative is a good idea, you should examine the above mentioned pros and cons and then apply them to your own specific situation.