You don’t wait. The moment you have the urge to launch a business in any way, shape, or form, you make a very specific hire. You hire a bookkeeper. If you are an entrepreneur, like most, you are afflicted with unorganized-itis. There is only one treatment for this disease, there is no cure. You need a daily dose of bookkeeping/organization in order to stay afloat. If resources are short, hire part-time, half-time or even barter services. The time is now! If you do not have a bookkeeper, you are already late to the party, hire one immediately.

Carl L Gould is the president and Chief DISCoverY Officer CMT International, LLC (www.CarlGould.com), the farthest-reaching business mentoring organization in the world. Carl’s unique approach to executive coaching, business mentoring and performance training helps his clients achieve results worldwide.  His upcoming book, The 7 Stages of Small Business Success – From Startup to 7 Figures in Three Years or Less, will provide entrepreneurs and business owners a step-by-step formula to taking their businesses to the next level.

When preparing for an interview with MSN, I was asked to answer a number of questions regarding partnership agreements. I offered the following insights on partnership agreements. I have created, arbitrated, and been part of partnership, JV (joint venture ) agreements internationally as well as domestically, and shared my perspective. 

Q; Who needs a partnership agreement?

A; A partnership agreement should be used whenever two or more parties agree to enter into a business relationship where money or services (i.e. barter) are being exchanged. Partners could mean two or more individuals or two or more companies. 

Q:why?

A: Research has shown that less than 50% of any conversation is retained and remembered by both parties.  When a conversation is memorialized in an agreement, the party’s memories seem to improve! J Another important reason for having an agreement is so that any interpretations or miss-interpretations of the oral/handshake agreement can be resolved BEFORE money or services exchange hands. Money is an emotional topic and the more money is involved, the more emotional people get. Having a written agreement removes the temptation for any of the parties to violate the agreement. Historically, most agreements include breach language with penalties and consequences. Those penalties and consequences tend to keep the parties on the straight and narrow.  
Q: What should be included in this agreement to make it successful?

A:

1. A list of all parties that are OR MAY BECOME INVOLVED in the agreement.
2. The scope of the activities that the agreement will cover.
3. What the agreement does NOT cover.
4. The duration of the agreement.
5. Start date and end date.
6. What constitutes a breach in the agreement
7. The ability and timeframe for either party to correct the breach of the agreement.
8. Exit language: Should either/any of the parties wish to exit the agreement, there should be a process/price to exit.
9. Method of payment for services rendered.
10. Mechanism to determine whether or not the actual operations are meeting the goals set forth in the agreement.
11. Roles and responsibilities of those who will be carrying out and implementing the activities set forth in the agreement.
12. Arbitration procedures to resolve disputes.

Q:. What shouldn’t be included?

A:

1. Telling either party HOW to execute their responsibilities. Otherwise, it would be an employment agreement.
2. Dictating hours of operations.
3. Any language that removes flexibility of the parties to resolve and correct any short falls in achieving the stated objectives.

Q: What can happen without a partnership agreement?

A:

1. Misinterpretation on who gets what and on who does what. 
2. ‘He said – she said’ arguments. The parties will get selective amnesia and only remember the parts of the agreement that benefit themselves.
3. In most agreements one party contributes the money and one party usually contributes the expertise. Without an agreement the money person tends to end up with more money and the person with the expertise just usually ends up with more experience (and less money).
4. One party will take advantage of the next party. 

Q: How air tight can these agreements really be?

A: The more ‘air tight’ you try to make an agreement, often times the less likelihood of success the partnership has. If this were a purchase or sales agreement, you could make it very air tight.  A partnership agreement, however, can only be made so air tight. Entrepreneurs by their nature do not like to be told what to do so the more restrictive you make it the less likely they will be to follow it. Paradoxically the more flexibility you can put into the agreement while still maintaining the spirit of the initiative, will give the partnership the highest and best chance of success.
Q: Can’t someone litigate if they want?

A: Yes, depending how valid their claim is will determine how far they will get. Bear in mind that an agreement is only as good as the people who enter it. Before entering any agreement, written or not, you must feel as though you trust the other parties implicitly and that you feel confident they would honor the spirit of the agreement whether it was in writing or not. While a good agreement removes the temptation for non-performance, it doesn’t ensure that the parties will execute their duties fully. Therefore an agreement should be a reflection of how strongly the parties feel about each other and how committed they are to a unified result.

Regards,

Carl Gould

Chief DISCoverY Officer 

The Global Leader in Business Mentoring

How can we be part of the problem? Did WE spill oil and contaminate the waters and ecosystem in the Gulf Region? Of course not….but we support the companies that did.  

Surely we cannot be aware of ALL of the places that BP sends fuel and power to. We may buy heating oil for our homes, or fuel for our cars and motor toys, or electricity from a local vendor and have no idea that BP or TransOcean was behind it in some fashion. The average person (and I put myself in that category) would have little or no way of knowing every transaction that BP is involved in. But folks, please…. There are BP gas stations all over the place with their signage prominently displayed. You can’t miss them. While enroute to a weekend activity, I drove past a BP gas station that had 4 fueling islands with 2 pumps at each island. ALL 8 WERE FUELING UP DRIVERS, AND THERE WAS A LINE WAITING AT EACH ISLAND!

If you want to teach BP a lesson, then simply drive to the next fueling station. One of the strongest votes you can cast, and the loudest scream you can muster is with your dollar. Where you spend your money speaks loudest about you and your views. If you knowingly support BP with your dollars, then you are condoning their actions. Please spare me the argument that the BP station is the ONLY place that you can get gas, and I f you don’t fuel up there, you’ll be stuck. For most of us, there is a station at every corner. A report on CNN yesterday said that BP has spent nearly $500,000,000 so far to cleanup this mess; and by the time they are done, it is estimated that they will spend $5B-$25B to clean up after themselves. Whose money are they REALLY spending? Yours and mine! Every time you fill up at a BP station, you created the demand, that lead to the drilling, which lead to the accident, which then funds the cleanup. You can stop the cycle by simply going to the next station. If you do that, it will send a shock wave in the oil industry that if you can’t manage your own affairs and keep the oil in the pipes, tankers, the trucks and safely into the gas tanks of cars without making a worse mess than my four-year old with a piece of melting chocolate in her hands, then you don’t deserve my business! 

Can you imagine if you did YOUR job that way? What do you think would happen to you? I heard a recent statistic that said that at the rate the oil is pouring out of the broken well head, it is the equivalent of the Exxon Valdez crashing EVERY 4 DAYS. It’s been over a month now folks, and the latest report says the well won’t be properly capped until (approximately) August.

Send BP the loudest and strongest message you possibly can by simply driving to the next filling station, and buy your gas there, even if it means waiting in line. Service stations measure their sales every day, and then compare them to the previous day’s sales as well as the ‘same day last year’ sales. It won’t take long before BP and the rest of the industry realizes that this practice is unacceptable. You are not in the milk business BP; you are in the oil business. You should be doing more that going onto CNN and crying… 

Carl L Gould is the president and Chief DISCoverY Officer CMT International, LLC (www.CMTmentors.com), the farthest-reaching business mentoring organization in the world. Carl’s unique approach to executive coaching, business mentoring and performance training helps his clients achieve results worldwide.  His new book, The 7 Stages of Small Business Success – From Startup to 7 Figures in Three Years or Less, will provide entrepreneurs and business owners a step-by-step formula to taking their businesses to the next level. www.The7StagesOfSmallBusinessSuccess.com