Herman School of Business
Silent Partners
So…you started a company from the ground up, or acquired one from the marketplace and now you “own” your own business. It’s all yours. You are the one shareholder and call all the shots. Not unless this business is in your fantasy world. Because if it’s in the real world, you may be the owner but you have several silent partners.
Partner number one is the landlord. He owns the space where your business operates and he therefore is impacted as if he were a partner in your business. You succeed, he gets rent. You do very well and he may get a percentage of that. You need more space and he jacks up the rent because he sees how well the two of you are doing in business together. But he is only a partner for good times. If you lose money, he gets his rent in full. If you struggle, he may throw your business out on the street, thereby making your business, remember, the one you own, a non-entity. This silent partner roots for you mightily, but contributes nothing to your bottom line.
Silent Partner number two is the bank or loan source for your start-up or acquisition. Each month this partner takes a slice off the top. This partner never misses getting a payment, even when there isn’t enough money to pay everyone, every month. Because failure to pay this partner means he will foreclose on his loan and suddenly own the business you thought you owned.
Silent Partner number three is a relative of yours, Uncle Sam. The government is your partner from the get-go with fees for licenses, taxes for equipment buys, fees for inspections, taxes for property you don’t own yet because you are still paying off the loans on it, payroll taxes on employees whether you make money or not. The government always gets theirs, or whoops, they close your business down showing you what a silent partner can do.
Three Silent Partners that get paid before you do. And you thought you were the only owner of the business.
- Posted: 31 October 2007
- Comments: 0
- Category: Business success
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