Keeping Transparency Between Partners in a Business

I started a small business with a partner who had already ran and operated several successful businesses, and fortunately, he was able to help me avoid many of the common mistakes that first-time business owners make.

One of the most important things that I've learned is that business partners need to be open and honest, but this is more difficult than it sounds. Miscommunication can quickly ruin a new business. Here are a few tips for keeping both partners in a business on-track for the first few months of operation.

Record-keeping is critical. Both partners should have their own copies of financial documents, especially bank statements and expense reports. This is best done automatically. Have statements sent to both business partners as soon as possible and if you're using software to track expenses, make sure that any reports are automatically sent to everyone involved.

In the first few months of running your business, this might seem unnecessary, as one partner is likely more interested in finances and it might make sense to keep access to one person. In the long run, however, keeping equivalent access to financial documents could save you a lot of hassle and keep both partners honest.

A business plan isn't optional. Even if your business is fairly straightforward, you'll need to make sure that all partners have the same goals and that everyone understands their role in the business. Otherwise, you'll absolutely have problems.

Sit down and write a business plan on paper, starting with your business's goals and objectives. Discuss a timeline and figure out who will handle specific duties. If your business will have titles such as CEO and CIO, know which partner has which title. This will make it much easier to work, because you'll get the arguments about who does what over with early. Responsibilities will be way clearer and there will be fewer easily avoidable mistakes.

Regular meetings help to keep everyone on-task. A small business can be hard to maintain and keep on track, especially if it's not your main source of income at first. This is one of the advantages of having a partner. You'll be able to keep each other working.

The best way to do this is to have regular meetings to discuss the status of the building and what needs to be done. These meetings don't need to take very long, and they're well worth the time that you'll spend. Meet for lunch once per week or call each other for a quick half-hour discussion of the business. Know what's expected of each partner over the next week and discuss how the previous weeks' duties were handled (or why they weren't handled). Staying on top of your business can mean the difference between success and failure.

Have any other tips for starting a small business with a partner? Post below.