Hire A Business Attorney When You Launch A Small Business With A Family Member

If you have a good relationship with a family member, such as a brother- or sister-in-law, a cousin, or even a sibling, you might often enjoy talking about business ideas with him or her. There may come a time when you decide to turn your talk into a business venture, and decide to launch it together. This is an exciting time, especially if you believe that your idea is a good one that will prove to be lucrative. Before you get too far along, it's a good idea to consult a small business lawyer to draft up an agreement between you and your partner. Here are some elements that this agreement can specify.

How You'll Share Profits

It's easy to get along with your family member during the early stages of your small business, but when you begin to make money, the dynamic can change. For example, your family member might declare that, because he or she has done more of the work up to this point, it's only right for him or her to take more of the profits. This might not be an idea that you like, and this can lead to a conflict, and possibly the end of your partnership. It's a good idea to decide exactly how you'll share the profits, 50/50 is a sensible idea, and have your attorney put this in writing.

What You Each Expect Of One Another

It's important to be clear about your expectations of yourselves and of each other when you launch a small business with a family member. You don't want to have one person constantly leading the way and the other scrambling to keep up. In this type of scenario, neither partner will feel particularly good about the arrangement. Discuss your expectations for sharing the work, early expenses, and other matters, and than have your business attorney put these ideas into your agreement.

How You'll Make Decisions

Making decisions is important in any small business, and especially when you're in a business partnership with a family member, It's easy to not want to offend the other person by failing to say that you don't agree with his or her idea. This dynamic can lead to challenges that compromise your business and your personal relationship. It's a good idea to discuss the decision-making process and have this included in your business partnership agreement. For example, you might stipulate that you both need to sign off on an idea before moving forward.