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In opening a business why is a partnership a good idea? |
In opening a business why is a partnership a good idea? for many reasons 1) when u have a partner then u are able to expand ur busness by adding new capital to this busniess 2) suppose any losses happened during the operation then you are not the only one who going to bear all the losses but ur partner will share losses with u 3) and a new person who may give new ideas and may help in the new busniess It usually is not a good idea. LLP or LLC would be better. It can be a good idea, but it can also be a bad idea. With a partnership, a business is exactly what it emplies, the business is owned and run by more than one person. You have 2 or more people working to make the business a success (hopefully), and have 2 or more ideas about how to do so. As long as all persons end up agreeing on the best way to run the business, you have 2 or more people working full time at the business, instead of 1 person (sole owner). But it's when the 2 or more owners either don't agree on how to run the business, or 1 or more of the owners is not carrying their weight in the business that a partnership can suffer. The person(s) who isn't/aren't carrying their weight can drag down the business, because while they aren't working as hard as the others, they are still a part-owner of the business. Personally, the only time I would ever make a partnership is if it was the only way of doing business. Rather, I would set up an LLC and be taxed as an S-corp. This allows all the income to be free flowing. You can also free yourself certain liabilities. Even in an LLP there is still a general partner who is liable for not only his/her own actions but also the actions of the other partners. Try going to your states, secretary of state's office website and there should be plenty of information there. |
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