FBIS, Investigative Accounting For Atlanta, Offers Insights Into What Makes a Good Business Partnership And What Doesn’t
Entering into a business partnership can be an excellent way to grow your business. However, it is not without risk, and it is essential to note that not all partnerships are successful. In fact, entering a partnership without due diligence could have disastrous consequences. Forensic Brothers Investigative Services, your investigative accounting professionals for Atlanta, is here to offer some red flags you should consider before partnering with a new business.
1. Long, Poor Credit History
1. Long, Poor Credit HistoryIf your prospective business partner has been financially irresponsible, you should take that as a red flag. A poor credit history could lead to significant financial difficulties later on, leading to late payments and even bankruptcy. Before considering a partnership, check your potential partners’ credit history to have a clear idea of their financial position.
2. Previous Bankruptcies
Declaring bankruptcy is a significant event for any business. It means they have encountered severe financial issues or mismanagement, which may ultimately have a substantial impact on your business. While there may still be some valid reasons for this, like external market factors, pay attention to companies that have declared bankruptcy multiple times. It indicates financial mismanagement or an inability to guarantee long-term success.
3. Being Banned from Running a Business
If a potential business partner has been banned from running a business, it should be considered an immediate and serious red flag. This circumstance could arise from various reasons, including a history of fraudulent activity, state or federal business regulations violations, or other unethical practices. A ban from operating a business can signal a propensity for illegal or unethical activities, a disregard for laws and regulations, and a lack of business acumen, all qualities that are incompatible with a successful business partnership.
4. Bad Business Reviews from Previous Clients or Customers
Before getting into a business partnership, conduct thorough research on the company’s reputation in the market. Poor reviews suggest that your potential partner may have a bad reputation, and this could lead to an expensive process of rebuilding trust with new customers. Investing in a risky partnership could also lead to losing your existing clients or customers, ultimately leading to significant financial losses.
5. No or A Vague History as a Business Owner or Consultant
It is crucial to partner with someone with sufficient industry experience to be successful. If your partner owns or runs a business, it should be operational long enough to attract a sizable customer base. Similarly, if they were a consultant, they should hold relevant expertise to provide ongoing guidance and support. Without a solid history of experience, it is risky to enter into a business partnership with a potentially inexperienced or untested partner.
Forensic Brothers Investigative Services, Investigative Accounting Services For Atlanta, Assuring A Great Partnership
Business partnerships require significant investment in resources, finances, and time. Given this, it’s essential to take heed of any red flags that may signal trouble down the line. A poor credit history, previous bankruptcies, a banned business owner, bad reviews, and a lack of experience can all be red flags that should not be ignored. A thorough investigation of a potential partner’s professional history, credentials, and business processes can help you make sound decisions and protect your investment.
If you are planning a partnership, one of the best things you can do to secure it is to conduct a thorough investigation of your potential partner’s background and business dealings. Forensic Brothers Investigative Services can provide business owners and entrepreneurs with the necessary investigative and accounting expertise to detect red flags and protect their investments.
Our experienced agents have professional backgrounds in accounting and investigations, allowing us to conduct thorough investigations and uncover financial discrepancies or fraudulent activities. Our ability to evaluate credit reports, conduct interviews, and scrutinize irregular financial behaviors can be invaluable during partnership negotiations.
If you are pondering a new partnership, you can rely on Forensic Brothers Investigative Services for support. Our experience and comprehensive services can facilitate the due diligence your business needs to grow.
Contact Us Now To Get Started, or Call Us at 678-915-1802
