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Is the current company structure fair or should we restructure......if so, what is the best way?

Boston, MA |

I have been in a partnership for 10 yrs and act as the managing partner.....what i believed to be a win/win was my partner's ability to sell products internationally.....my expertise is in the usa........I have literally put together the product line, and have done 100% of the sales...We contract mfg in China and design in the usa......After many, many attempts to get my partner to bring in revenue, I have exausted my efforts.......he feels doing the invoicing and a/p is equivalent......I keep saying it is an office job and he should not be entitled to 50% of the profits......We are a small business doing 1-1.5m and I have stated it needs to be built to 8-10 m before he can just "run operations".......any feedback would be appreciated.

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Attorney answers 3

Posted

Unfortunately, what is "fair" to you or him is largely irrelevant in the legal analysis. You may want to buy out his interest in the partnership and go your separate ways. If I can be of any assistance, please do not hesitate to contact my office.

Posted

telling you what you should have done is a waste of our time.

You two need to negotiate the terms of any continued business relationship.
You tell us nothing about any existing agreement, and the legal nature of the partnership.

Posted

All business relationships suffer through difficult times especially when the economy is in a slump. Based on what you wrote, it seems that you and your partner have very different ideas about how the company should be run. However, that does not necessarily mean that a partnership is no longer the best business entity for your operation.

You and your partner should each take some time and write up a brief summary of how you see the business now, where you want the business to be in a five years, and the steps you think the business needs to take to get there. When you compare the two answers, I'm sure you will see many differences.

Then, you should work with an attorney who specializes in working with very small businesses so that you can get the business, and yourselves back on track. Don't hesitate, this kind of friction between partners can be the death of a company faster than you think.

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