What to Do When Your Business Partnership Sours?
Businesses can easily be affected by human relationships, and if your relationship with your business partner has taken a turn for the worst, you can expect that it will affect your business in the future. If your business partner holds a considerable stake in your business, however, you may face difficulty in removing them from their position. Find out what you can do to end your business relationship.
Buy Out Your Partner
This can be a very expensive option, but it can allow you to retain control of your business while getting rid of a bad partner. The amount your partner is entitled to depends on many factors, such as:
- The percentage of the company they own
- The revenue of the company
- The amount they have invested in the company
- How their investment has affected the company
Provide Them with a Royalty in Exchange for Control
This can be especially useful if your partner helped to create the product but has little interest in running the business. You can offer them a percentage of your business’s revenue for a set amount of time, in exchange for them stepping down for the business.
If your business is new and there isn’t much of a brand loyalty or following yet, going your separate ways and starting a new business may be the best option. This can help you handle a difficult partner in the early stages of a business, before the problem is allowed to grow.
Terminating a Partnership
When ending your business relationship, it is important to have all terms and agreements written out to avoid later confusion and arguments. Your business litigation attorney can help you ensure that all issues are carefully documented and that all agreements and contracts are legally binding. Doing so prevents your partner from taking legal action against you later.
At The Hunnicutt Law Firm, we will fight tenaciously for your best interests and to protect your business. We work with you to devise the best strategy for your case, and our team is invested in resolving your case with the lowest risk possible. Our Dallas business litigation lawyer is ready to fight for the results you deserve and we also offer alternative dispute resolution.
Contact our firm to learn how we can help you. Call (214) 361-6740 today.