The benefits of Partnership business

 Incase you didn't know, partnership business is beneficial. It has  it's own unique benefits or advantages. Infact, the advantages of this kind of business framework is very tremendous. It can serve as what could motivate you to establish it's kind.

               1.SUFFICIENT CAPITAL 

                     ILLUSTRATION 

A man wanted to journey to a distant land by boat. He didn't own a boat. He must either buy one, rent, or board one to where he wanted to go to. Due to certain reasons he wanted to hire a boat. Since he could not ride,  someone would be contracted to captain the small boat to wherever he wanted to go to. So he had two major expenses to make if he must fulfil his dream of journeying with a boat; payment of boat renting and driving fee. 

He met the people who owned the boat, to table his concern to them. They listened to him and told him what he needed to do to rent the boat. He must pay them for the boat a certain sum. How and how much he would pay the person to drive it, was his concern not theirs. But the terms on renting the boat, which included how to return it to them, was availed to him. 

It appealed to him, but he found the cost of renting to be expensive, he could not afford to pay it, he didn't have up to the amount, he lacked. No matter what he said, they never accepted to rent it to him at a cheap prize. While still negotiating the cost, someone came at the river side, where they were. He too was in need of a boat. After pleasantries, he submitted his concern to the owners of the boat. And they told him the requirement. Like the first man that came before him, whose name was Simon, he too didn't have sufficient money for renting. By this time, Simon has refrained from talking and was engaged in thought on how to go about his problem. But the man that just came, like himself, was trying to persuade them to reduce the cost. No matter what he said, they never agreed. It was during this time, that Simon devised an idea, and told the man, 'excuse me sir', while he was still talking. Surprised as to why he interrupted, he looked at him demanding an answer. But Simon was able to excuse him from the boat owners. They shifted and got talking. Simon explained that he came for the same purpose and that since his money was not sufficient, they could contribute the amounts they have and hire the boat to the town where they wanted to go to.

When they returned to the riverside and told the owners, they told them that even more than one person could hire the boat. To cut the story short, the two of them was able to get two more people to contribute to the hiring of the boat. Each one contributed to it, and when they calculated how much it summed up, it was infact excess or more than required. 

What is the point? When plenty people contribute money to start a business, the chances that the money they would get would be higher than that of a single person is higher. Like those who wants to rent a boat, if you get a team to contribute to the funding of business capital, you would surely get a higher amount. This is why the problem of lack of capital does not exist in partnerships business. As human experience shows, those who choose partnership as their niche usually secure enough capital for business setup, by tasking each of those in the team the capital.

 When you want to start a business alone, you may lack money, but when many are involved the story would be different. If one member has less, another would have much. Two individuals do not always have the same amount of wealth.

 Some have less, but others have much. And a combination of all the money, that many would contribute to the formation of business, would very likely surpass that of one person. Therefore having many people to start a business with, means having more capital. 

Partnership is not like sole proprietorship. You are not the only one that would contribute to the capital. Those you would forge the business with, has to contribute. Exploiting on this opportunity you could choose to form a business with very rich people. Imagine having in your team such people as Mark Zuckerberg and Bill Gates. By the time they contribute to the capital of a business formation, more than necessary would be required. Capital is what is used to drive most of the activities and processes of business formation like; land purchase and registration. Thus having enough capital, you would not have any challenges in starting a business, but could create a more lucrative venture.

      2. INCREASE IN PRODUCTION 

There is a correlation between capital and production. Capital consists of money, and assets. As human experience shows, those who establish this kind of business usually realizes more than sufficient capital, due to mass contribution by the team. Efficient production requires good equipments. When the equipments used in production are in good order, operations with them would be efficient.

Production equipments are expensive, and purchase of them would be particularly easy if there is enough money to.The best and modern ones would be purchased when there is sufficient capital.

When there is enough capital, the best production equipments could be purchased. This would result in effective production operation or activity with the usage of the equipment. 

And the company could engage in mass production because their is surplus money to buy surplus raw materials and power production operations.

When there is increase in production as we know, then there would be increased products for the company to sell. This means more money as we know, for more sell means more patronage.

        3. JOINT DECISION MAKING 

 Conventional a thing with sole proprietorship is that the decisions are made by all the members. Better decisions or judgements are always reached when two or more people put their heads together over a subject. All members would benefit from the diverse perspective of matters by the various members. When good decisions are taken, it would have good effect on the business, but the otherwise would occur when the opposite is done.

             4. EXISTENCE OF PRIVACY 

All businesses have secrets. Their is always something the business would want to conceal from the public. Their weakness. Records of illegal transactions that could affect their reputation or even the secret of the success of the business. And the success of something or it's failure could sometimes be dependent on the secret. For instance, if an opponent knows the weakness of a business, they could exploit on it, by using it to fall them, perhaps by revealing it to the public, who may not want to identify with them because of that inadequacy. Or if they know the secret of their success, which may be a formula, they could use the formula and surpass them, and gain their customers to them. As it is with humans so is it with Business; we all want to keep our secrets a secret.

 In partnerships, privacy is guaranteed, because each and every member would undertake not to reveal the secrets of the business. Breaking the rule always conflicts or breaches the law and sometimes attracts punishment or fines, which no member would want to pay, thus, they refrain on their part from disclosing the secret. Also, because they know that the secret of the business if disclosed could affect the business, and that if it affects it, it would affect them personally, hence they are directly involved, they would not want to disclose the secret of the business.

If you want to start a business in which the secrets of the business would not be disclosed partnership is for you.

         5. EFFICIENT MANAGEMENT 

Partnership is a team. And a team consists of different individuals. They have different skills and strength. Thus each one would bring into the management different strength and skill.

When different people have to manage a business, they would bring their different skills into the business. When one person is not good at a thing, the other is very likely to. And the one good at it would help to fill the gap.

                      ILLUSTRATION

Partnership is a team of people that contracts to build a house. They all have different skills and experience. Some are good at roofing. Some are good at painting. Some are good at making of blocks. Others are good at making of flours. All of them would input their different skills into the various activities of the business.

               6. SHARING OF RISKS

If you are the only one to ride a ship to a place, you are the only one that would bear the risk. No one would be affected by anything beside you, because you are the only one in the boat. Risks as we know are better when shared. When the partners share the risks and liabilities among themselves, it would lessen the effect, because everyone would receive a percentage of it, and this would ensure the burden is not heaped on one person alone as in sole proprietorships.

   7. BETTER CHANCE OF CONTINUITY  

It is guaranteed, the continuity of the business, because the death of one person cannot stop the business, other members would continue to run it in the event of demise.

   8. SPECIALIZATION IN MANAGEMENT 

It involves many people managing and running the business. All the member would focus in the department he is good at. Hence the result would be exceptional, since people do best when they specialize. 

    9. HIGHER CHANCE OF EXPANSION 

If the team admits a new member, there would be an increase in the profit of the business, and they could use it to enhance or expand the business. A certain business intrigued me. I became very involved in 'following' the business. I would read about them. I would be the first person to buy their product. Someday I found a Newspaper with a heading on the business and purchased it. It featured an interview on the business with the manager, and I started to read it. To cut the story short. The manager was asked a question on the admittance of a new member into the group. What benefit he thinks his admittance would bring into the team. And he disclosed that the capital he contributed was very enormous and the company intends to use it to expand the business. This was a very rich person after all. No doubt the capital was very bulky. That experience testifies to the claim that partnership business has a high chance of expansion.

And in the case where the company does not have to wait until a new member would be admitted before they expand, they would use the profit they would realize from their

         10. EASY ACCESS TO LOANS

A partnership business can easily obtain loans, since they are jointly liable. Experience supports this, as most loaners do not have a problem with giving loans to Partnerships. 

The loans can be used for efficiency of the business or geared towards other interests.

       11. INCREASED EFFICIENCY 

The availability of surplus capital, special skills and talents, better management would result in the efficiency of the business

                 12. LUCRATIVE 

By requirement, the capital for formation of partnership is usually higher. No one would channel into a business high capital if he does not believe it is profitable. And it really is, as we have come to realize. There tend to be higher chance of mass production in partnerships. Most of the products produced in mass or most of the business that engage in mass production are partnerships. This results in the availability of more products for sell. And the more products a company sells, the more profit they would make. 

Perhaps this is the most enticing of all the benefits of partnerships. People like money. No wonder then, why it is one of the most embraced form of business.