429: The Challenges Of Construction Business Partnership

<h1 style="text-align: center;"><span style= "color: #0000ff;"><strong>This Podcast Is Episode Number 429, And It's About The Challenges Of Construction Business Partnership</strong></span></h1> <p><em>Randalism: A Partnership is the only ship designed to sink.</em></p> <p>However, we understand your preference, so I would like to talk about it in this blog post.</p> <p><span data-preserver-spaces="true">Joint ventures are a bit like change orders. They can be an incredible opportunity to make or lose much money very quickly. Almost as quick as betting money on a roulette wheel in a casino.</span></p> <p><span data-preserver-spaces="true">Joint Ventures have their own accounting rules. The devil is in the details. How costs and profits are shared among the participants depends on how the joint venture is structured and the terms of the agreement.</span></p> <p><span data-preserver-spaces="true">Contractors with annual sales of less than </span><strong><span data-preserver-spaces= "true">$10,000,000</span></strong><span data-preserver-spaces= "true"> often get together to work on a specific project. They find a friendly competitor to supply labor and equipment for a percentage of the job, hourly fee, or a flat number. This could technically be a "Joint Venture"; however, the time and scope are generally short and sweet. For example, a concrete contractor may have a large project requiring more finishers than on staff.</span></p> <div> <p><span data-preserver-spaces="true">For many business owners, partnerships are an ideal way to run a business. Operating a company with a partner means you don't have to make all the decisions independently. It means you have someone there with you to help you carry the burden and share ideas with. That can be a great thing when it lasts.</span></p> <p><span data-preserver-spaces="true">Unfortunately, many construction business partnerships fail. Although they fall for various reasons, some main factors contribute to a business partnership breakup. Here are three reasons business p