Know-How Exchange : Branding

To give a name to do with the three of you, you'll need to include something ABOUT the three of you for us to use. Thus far we only know your name.

Er ... someone's going to ask this so it might as well be me: cake decorating classes relate to quilting supplies how? I'm sure there's a connection: could you enlighten me?

But let's back up and delve into business mechanics for a moment, shall we? And yes, I know you didn't ask about this but I'm going to ask anyway because friends or not YOU need to protect yourself from the world.

If you've already got this covered, great. If not, you need to think about your plan carefully.

Friends or not this is a business and it needs to be
run on a business footing NOT on goodwill. I know that sounds harsh but it's harsh for a reason: trust alone
isn't enough. You need contractual oversight.

You can all be friends AND run a business, you simply need to separate the emotion and common ground from the business planning, and from the finances.

You save yourself from the possibilities of financial and legal pain through the application of—and adherence to— strict, written, legally binding contracts that outline EXACTLY who is responsible for what, and that clearly spell out how decisions will be made; how borrowing, capital accounts, and set up costs will be arranged invested, and paid; how the day-to-day finances will be managed; how the business will be managed and how decisions will be made; how accounts, bills, and taxes are processed and settled; how profits are distributed, and how equity is dispersed.

You MUST NOT work on trust.

You MUST NOT have a word of mouth agreement.

You MUST NOT leave all the finances to one person.

There must be equal control, equal management, equal access, equal oversight, equal responsibility and equal accountability.

Word of mouth agreements aren't worth the paper they're printed on.

Yes, there might be strengths and skills within the group and you can take advantage of those things ... BUT ... you need to cover your assets and bases and you need to do so in writing—a document to which you all put your names and signatures, and a document that is witnessed by a notary. This then becomes a legally binding contract that will stand up in court, if that ever becomes necessary.

If you don't take these steps and things go south ... you could lose out, wind up in court, and find yourself in the middle of a "he said, she said, they said, she said" battle with nothing to back you up or to protect you. I've seen it happen.

If someone decides to help themselves to company funds without the knowledge of the others involved and that person then skedaddles with the loot (or the credit card), if your name's connected with the business ... YOU are still responsible for accounts payable. And for rent, utilities, vendor accounts, supplies, taxes, insurance, legal bills, liabilities, social security, benefit payments ... and a good
deal more. Know from the beginning what you're getting yourself into.

Talk this over with your friends, then, find a local lawyer
who specializes in this stuff and go and see them (find a lawyer through your local chamber of commerce or through the SBA (https://www.sba.gov).

If either one of the other people involved shoots down or blows off the necessity of working with a clearly defined written contract ask yourself why.

And if you hear the phrases "I thought we were all friends here!" or "... what's the matter, don't you trust me/us?" ... walk away.