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Old 18th March 2012, 05:11 PM   #1

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Default Huge Dilemma - Business Partner Not Selling - Advice Appreciated

Hi everyone,

I would really value and appreciate some help with my current situation. Huge thanks in advance to you for your wisdom and advice.

I set up a business 50/50 last year (May 2011) with my business partner who is 9 years younger than me. We left a company and set up by ourselves. A year on and we are hitting the targets we set ourselves, only I have bought in huge amounts more money than my partner. To put it into perspective, my clients have generated 90K and my partners clients just 8K.

There was one client that I bought from a previous employment who has contributed over half of my revenue, perhaps 50-55K but even so, I am still generating much more business than my partner, particularly new business and my general feeling is that I am wondering why she is not taking responsibility for the sales. My other thought is, why did I not do this by myself?

My partner (Who is also a friend!) knows how I feel about the situation (as I finally had enough of all the stress and worry on my shoulders for generating the bulk of the business) and told her last Friday in a frank and fair way, however she has been quite immature about it - Crying hysterically when I confronted the situation (In a cool, calm way as I am not confrontational) I have bottled my feelings up for so long that now I have voiced them, I just feel empowered to do something. My main concerns about my partner are as follows:

-She always waits for me to start cold calling before she does, she'll never initiate it.
-She sometimes uses networking to socialise and i feel I work harder to sell at networking events.
-We work from home but she is often late to my house making me feel she is not taking this partnership seriously.
-Even after I bought my feelings to the fore, she had the perfect opportunity to begin selling (To show me she was trying) but she did not make a cold call all day.
-We have a business development spreadsheet to record our sales work. She has not updated hers since the end of January.
-In all the time I have been bringing in sales and keeping us afloat, she has not once told me that she feels bad/guilty for her performance or asked for any help. She has just buried her head in the sand, hoping some sales come her way and made me angry in the process as the lack of communication has made me feel that she has not cared about her performance.

I value my business partners contribution in other areas of the business, she is great at design work and made us an amazing product brochure, she also has taken responsibility for the book keeping and other integral tasks. However, these are all tasks of an employee rather than a Director and the key component of being a Director is selling and taking responsibility personally for the numbers like I have. She is significantly younger than me, not as connected in the industry (Due to me having more experience) so I never expected her to make the same volume of sales, but I did expect a better performance and effort than this and certainly more urgency in her approach to getting in business. I feel that she could make more effort when we meet new people at networking functions, she could cold call, research other channels for selling, go on more trips to meet more people within the industry instead of booking up her weekends but she does not prioritise sales and instead, lets me carry her. I have now expressed my feelings to her and things are awkward, however I am keen to resolve this so that I feel things are fair. Currently the 50/50 split is not working due to my over-performance and her lack of it and I am resenting her taking the same dividends as me.

My current feelings are that I can take action in one of the following ways:

-Carry on as we are for two months and review again. If she has not bought in anymore sales, discuss the way forward. Perhaps splitting the equity in my favour as we are 50/50 currently.
-Another option is her taking an employee role in the business where she is not responsible for sales and she just takes a salary and gives up her 50% share ownership.
-Change the stakes to reflect a fair split such as 65% in my favour, 35% in hers. Offer to take it back up to 50% once she is contributing more sales.
-Dissolve the partnership - Offer to buy her out thus keeping the brand. (It would be awful to lose the brand at this stage and this would be my last resort)

My current feelings are that due to my 4 extra years in the industry, connections, etc, I always had an added advantage and 50/50 was never really a tangible agreement. It just hasn't worked and our current situation is hugely indicative of that. It's just a shame as we are friends and now things have become awkward!

If you feel you can offer any help I would be hugely delighted to hear it as I am spending most of my days feeling very stressed and anxious at the moment and I need to bring this up with her again to get it resolved.

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Old 29th March 2012, 01:32 PM   #2
John Tabita
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It sounds to me that your partner is a round peg in a square hole; meaning, she's just not a sales person.

Another option is to keep her as a partner and split the duties as you've described in your "take her on as an employee" option.

When I ran my web business, I was the front-end designer, one partner was the programmer, and the other brought in business. We split the compensation in a way that he actually made more than the two of us, because he was generating revenue directly.

Your business model may be different, so what I said might not apply. I guess it depends on how much you value her in a partnership capacity.

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Old 31st March 2012, 12:47 PM   #3
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Hi Londongames2012

To start, I have to say that your story is upsetting; mostly because it's so common. Secondly, please know that I am going to say things you may not want to hear. But like that good medicine, it's tough going down but it works.

Let me start with this:

First mistake: My partner (Who is also a friend!) -THIS IS TRICKY AT BEST
First Good Question: My other thought is, why did I not do this by myself? - YEAH!

I read your entire post. From the very start, I had your answer. But I read your entire post anyway.

Look. No matter what business you're in, the first and most important job is to get customers. I don't care how many you have... you never have enough. Obvoiusly your partner doesn't understand this. Secondly, the next most important job you have it to get more customers. Oh, did I mention that already? Get it??

As for your proposed options; forget about them. End this NOW. It will not (and I guarantee this) get any better in one month, two months, three months, one year, two years... It will not get any better. I guarantee that!

The first problem YOU have is getting THAT to sink in. (Sorry... not beating on you) You're hoping against hope. That's nice. In fact, you may even consider that noble. The problem is that it's not going to make you any money.

You know you can't be 'a little bit pregnant', right? So sitting on the fence waiting and hoping and waiting is doing just that. You're trying to operate a business (your LIVING) and doing it while you're a little bit pregnant. You can't.

Do this test. Sit back, close your eyes and just think about how much MORE EFFORT you could put into things that really matter (like getting new customers that add to YOUR bottom line) if you weren't wasting your time on this person. You would be in la-la land!

So, here's your 'to-do' list.

1- Not knowing what your 'legal' structure is and all of that, set up your own company. DO THIS MONDAY (as I am writing this on Saturday.... or the first business day possible). Your new company should be something very, very similar to your current one. Even putting in '2012' or something like that. (Remember, I am not a lawyer and certainly do not know all the laws in your country. But you HAVE TO DO THIS)

2- Contact your customers. The change will be simple when you give them a reason. Make it short. Make it so that they will see a benefit to THEIR relationship with you and a reason to stay. You could just say that you've agreed to move forward in different directions and that you value their business and want to give them the best possible service. (I don't know what business you're in... so you may have to adjust that). WHAT EVER YOU DO... do not slam the other person. Avoid any questions about her. Just answer by telling people 'you don't know her plans' or something like that. KEEP THIS CLEAN AND PROFESSIONAL.

3- Just tell her it's over and she can do what she wants. Just don't let her use phone/fax etc. that belongs to the company. Cut off those services THAT DAY. Now, you may not want to use them either... and legally.. you may not be able to use them... so that's why you have to plan your move (but do it quick). Contact customers 5 different ways with new contact details, phone, fax, e-mail, website address... give them everything and then mail it to them too! So... send them e-mails, text messages, call them... do it as many ways as possible.

Notice... you put everything in place first. Then tell her. Do you think it's underhanded? I don't care what you think about it. It's the solution that will let you SURVIVE. That's what it's all about. Treat this like the building is burning... and you have to put the fire out NOW!

Why? Because she will ride your coat tails as long as YOU LET HER. That's what you're doing... YOU ARE LETTING HER. She's not going to change. I assure you she is not. Just let it go... get started on your own... outsource or hire for the tasks.

Oh... the branding... if you use a company that's close in name, you may be able to 'borrow' some of that branding. If not... don't worry. Your customers are buying YOU... not your fancy branding. Trust me on this... it's nice... but they are buying YOU!

Cut it now... cut it clean... and RUN. She will not change. I promise.

Okay... then you can thank me for the advise when you're relaxed and rocking your new business. Do it now... and good luck!

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Old 5th April 2012, 06:07 AM   #4

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I also run a business with my friend (and we met at a company where we worked together too) so I understand how hard it can be when you bring a friendship to business. How we work it is that we are also 50/50 partners but over the years (we've been in business for four years) we've noticed we have different strengths and weaknesses and have restructured the business to suit these and also asked for outside help for areas where neither of us excel, such as maths so we hired an accountant for example.

It hasn't been easy but luckily everything is now running smoothly and I think the key is because when it comes to sales, we split any calls or networking etc 50/50, even though we both hate cold calling!

Have you spoken to your friend about why she won't get on the phone and generate calls? Could it be that she's fearful? I've written a blog post about how scary cold calling is and how to survive it which might help (http://www.pureinkcreative.com/blog/...y-phone-where/). If it is down to a lack of confidence from her then perhaps you could suggest she has some coaching or attend stress/confidence workshops? Like everything, cold calling and lead generation gets easier with practise but if she's not willing to get better at it then it might be time to restructure. If she does have strengths which help the business but don't bring in direct sales then it'll be worth discussing with her whether she still wants to be part of the business without being in the role of director.
Good luck with everything and remember that you're not alone as unfortunately this is a very common problem!

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Old 20th April 2012, 02:01 PM   #5

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Default Huge Dilemma - Business Partner Not Selling - Advice Appreciated

very good point "john tabita wrote"
keep her as a partner and split the duties as you've described in your "take her on as an employee" option.

one more piece of advoice do it thru counsel be smart...

best of luck

or open another company and bring in youre future clients thru there and youre partner will have to make the sales and meet close to youre quota!

if theres a will theres a way, please!
perhaps she could care less about sales knowing that you already work hard enough for her as well
"people often mistake kindness for weakness"

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