by JC Campbell

Created on: March 12, 2008

Operating a three-person business could prove to be a resounding success or an unmitigated disaster depending on the groundwork laid at the beginning. Three people working in harmony and in an organized fashion can result in a highly successful business venture. By the same token, a lack of organization will surely see a business crumble.

As is true of any business venture, preparation is a key to success. This is even more important when there are three people involved in the planning and funding of the new business. Before the venture even gets off the ground, all of the details should be worked out to the satisfaction of all three partners.

When agreement has been reached as to how the business will be structured, who will be responsible for each aspect and the financial commitment of each person, make sure to put everything in writing with each partner receiving a signed copy. Putting it in writing is vital, even if the partners are of the same family or are close friends. Nothing will break a friendship more quickly than arguments over business matters.

A successful three-person business will be clearly planned with each member knowing where their responsibilities lie. For example, one may be responsible for stock, one for sales and another for accounting. Agreement should be reached in advance so that each partner is clear as to their liability toward the business. When roles are assigned, it is important to allow each member the freedom to operate within their assigned role without unnecessary interference. Discussion in the interests of the business is one thing, but interference will only cause acrimony and potentially harm the success of the business.

Regardless of the specific roles assigned to each partner, make it a point to meet regularly to discuss the current success of the business and to look carefully at how it can grow and improve. Regular meetings keep the lines of communication open and can help identify areas where improvement is needed.

Such meetings might also reveal a need to switch roles if it is found that one partner is struggling or that another would be more suited to another aspect of running the business. These occasions will also afford opportunity to look at the financial issues related to the business such as how to increase sales and profits.

A three-person business can be a highly successful arrangement provided all parties are fully committed to success, are clear on their personal responsibilities and have taken the time to make sufficient preparation before the business venture gets underway.

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