Bringing in a partner to your established business can be the answer for an entrepreneur looking for the following:

• Additional cash to pursue new growth opportunities;
• Additional talent in an area that is foreign to the original owner or cannot be pursued due to managerial constraint;

If a business is struggling with cash flow it will certainly help to attract an outside investor, BUT what else can they bring to your table?

If you are to expand your business you must identify your own weaknesses beforehand.  More valuable than money is to bring in a partner who has the expertise you don’t; for instance, marketing, social media, internet, accounting etc.  By complimenting each other’s skill set you double or triple your success factor.  It’s better to share with someone you trust and can work with than to suffer failure because you thought you could do it all yourself. (https://flooringoutletandmore.com/)

Here are the Top Benefits of attracting a partner:

• Brings new talent and offers growth opportunity into areas not previously identified;
• Splits the reins of accountability and allows more social freedom for family, friends and for personal or trade skills development;

What should you consider when seeking a partner?

1. Attract someone who knows what you do not.  Someone who respects you and there is the ability to establish mutual trust;
2. Attract someone who can add value to your vision and share equity risk;
3. Seek legal advice when preparing a partnership or shareholder’s agreement.
4. DO NOT treat your new partner or shareholder as an employee with cash but as a contributor to success.

Hiring an HR Consulting firm will help to improve the quality of your search and selection.

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I once had a customer tell me, “If you don’t grow big you will never get a vacation”. Such is the life of the passionate business owner who spends as many waking hours as possible in start-up phase to make sure his/her business reaches sustainability. I call it “gas in the tank” in short working capital. Where does it come from? In start-up phase you provide the cash needed to pay the bills until sales reach a level where net of expenses you actually have a profit. Without profit you have to keep subsidizing your working capital requirements. If you are subsidizing you are not yet sustainable, so profits are the key.

To ensure you have command and control over your numbers you have to review your numbers either every day or at least weekly. If you don’t, how do you know you have reached your sustainability target? Sometimes you will know within 3 months of start-up if you are going to make it. Notwithstanding when profits become assured you will know because you are no longer subsidizing the bill payments. The danger is in thinking cash flow not profits are sustaining your business.

When you pass the sustainability test you enter the growth mode of your enterprise because you have honed your financial command and control skills and have added infrastructure that will improve sales and garner greater stability. Sustainability and stability are required for long-term success. At this stage you may still not be taking a holiday because you are still married to the day-to-day supervision of staff and cannot let go of being in charge. If you do not actively mentor someone who can take over your duties you may suffer burn-out. Every business owner needs to recharge their batteries. Taking the time and patience to work with someone you can leave in charge will go a long way to improving your business’s stability.

So when do you hire an operations manager? Just before you go crazy with stress but after you have attained sustainability. If you are frequently angry with your loved ones and people around you take note.  Profits improve propensity for growth and are the key to your specific answer to this question.

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In the start-up phase of any business the owner manager does everything. The enterprise then adds employees.  The owner/manager trains them, nurtures them, however there was always direct involvement.  Later the enterprise has grown to include multiple divisions.  The days of doing and knowing everything are long over.  But how do you as owner transition?

Top owner/managers come to realize they simply cannot touch all of the work.  In Mr. Yamada’s case he has developed the successful approach of taking a “micro interest”.  He no longer stands over shoulders…but he checks in on critical control points for tasks and projects assigned. He relies on good people for the right answers.  By picking two or three critical control points he can check in on only those where problems are more likely to occur. In this fashion he leaves micromanagement behind in favour of relying upon the skills and knowledge of those he has hired.

So too have you hired, trained and rewarded employees and have learned to trust them, especially your division managers.   By letting your workers take the reins you allow them to follow you.  By taking a micro interest approach but more importantly taking a larger interest in employee development you breed workers and managers who want to exceed your expectations.

In smaller enterprises the owner is either the mother or father of every job in the place.  In my experience you have to reflect on the sum of all your parts; how did you get where you are?  By taking an active role in employee development you build trust, respect and loyalty.  You should not fear delegating to those you have hired and nurtured if you have earned their respect.  If you cannot delegate the problem may be with your internal relationships.

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