|By Harvey Mackay
Of all the arrangements people use to conduct their business, none is more fraught with danger than the simplest: partnership. The problem is that the basis of any partnership is sharing.
That should be easy. Two partners, two shares. Generally fifty-fifty.
Well, it isn’t so easy. In the burlesque era, comic teams used a different formula. The straight man got 55 percent, the funny man got 45 percent. Why? The straight man was the agent for the team, responsible for getting the bookings, negotiating the b illing, all the nuts and bolts stuff.
Abbott and Costello started in burlesque and had the usual 55/45 arrangement. When their movie career took off, the funny little fat man, Costello, became the more popular member of the team. Costello wanted to change to a 50/50 split. Abbott resisted.
For the last 10 years of their partnership, they barely talked to each other when they weren’t performing together and the quality of their work showed it.
Ditto: Martin and Lewis. Sonny and Cher.
Okay, three partners. Three equal shares. Not so easy, either. Remember Tinker to Evers to Chance, the famed Cubbie double play combination. They didn’t talk to each other, either, and they weren’t even fighting about money, they were just throwing a ball around. The Supremes. Their breakup was so dramatic they even made a Broadway musical, “Dreamgirls” out of it.
Four partners. The Beatles.
And so on.
Okay, that’s mostly show biz. Those folks are a little different. Is it any better in the real world? No, just less visible.
Lawyers, accountants, doctors, stockbrokers used to operate almost exclusively as partnerships. Not so much anymore, because the tax, estate and liability laws are all skewed in favor of a corporate structure.
But when we take a look at those that still retain the partnership mode, we’ll see that they are not without other problems.
No one expects the president of a corporation to do the grunt work of a junior associate, but in partnerships, there’s a different attitude.
Talk with the junior members of a law partnership and the gripe is the same: “We do all the work; the senior partners get all the money.” Ask the senior partners and they’ll say: “1) We paid our dues when we were younger. So should they.” or “2) Now that we’ve got the experience and reputation to do the work more efficiently than the novices, we’re able to charge more for it. So we should get more for it” or “3) We bring in the business that gives them work.”
Of course, they’re both right. But there’s that word, “partnership,” which suggests an aura of equal effort and equal rewards and brotherly love that just doesn’t exist.
When young people go into business, often it’s with a partner. Joe decides to buy a gas station. He’s a little timid about taking it on himself, so he talks his buddy Al into going in with him. Joe rationalizes it with “Al’s good at fixing cars, and I’m good at schmoozing with customers and doing the office work. It should be a good partnership.” It should be, but it won’t be unless both partners understand and accept their roles. But if one is a workaholic and the other isn’t, if Al resents going home covered with grease every day, while Joe never gets his shirt dirty; if Joe feels humiliated by Al’s superior attitude about car mechanics and insistence on ordering expensive equipment; and if the spouses don’t get along, the partnership isn’t going to make it.
If you’re independent enough to consider going into business, think seriously about doing it yourself if you possibly can. It’s tough enough starting your own business without having to deal with partnership issues. If there’s no other way, be aware of the risks of going into business with a friend or relative. You’re far better off forming a partnership with someone you have worked with professionally over a long period of time.
You know their strengths and weaknesses, you know how they perform on the job, and you don’t have to maintain a personal relationship with them outside of work.
One partner is enough. The one you married.
Copyright © 2016 Harvey Mackay