You've been running your small business well, and now you need a partner for more capital and expertise. There is a partner you have already identified, but cannot proceed with the partnership because you are not sure whether the distribution of profits and losses will be done in a fair way or responsibilities towards the partnership will be shared properly.
In other words, you don't have a proper freelance partnership agreement and feel you will not gain from the partnership. There are various online resources where you can find a small business partnership agreement template, but you might still be unsure as there could be loopholes in it.
While the template could be modified, there are some basic tips you need to follow when it comes to drafting a freelancing small business partnership agreement.
We will share those tips with you so that it includes the important information that every partnership agreement needs to address.
When drafting a small business partnership agreement template, here are some points that should be kept in mind:
As a freelancer, you must give your partnership a name that should be checked, whether it is available for use or not. Using an existing name for your small business partnership agreement template would lead to copyright violations. Once you get an available name, you should apply for a trademark so that no other business can use it.
The small business partnership agreement template should contain both - the name of your partner and your own. You should also include your qualifications and background, along with those of your partner.
The kind of business you and your partner are engaging in should be included in the small business partnership agreement template. This will decide the laws you need to follow while drafting the consultant agreement.
There are different types of partnership agreements like a general partnership, limited partnership, or limited liability partnership. Your small business partnership agreement template needs to specify the type of partnership agreement you are entering.
Every legally binding agreement has an effective date from which the agreement becomes valid, and after a certain period, the duration of the agreement, the agreement is terminated. The small business partnership agreement template should include the start date and the end date of the agreement. You should include a provision for an extension, in case both you and your partner want to extend the freelance agreement.
The amount of capital being contributed by you and your partner should be stated clearly in the small business partnership agreement template in figures and percentage. The percentage will decide the sharing of profits and losses between you and your partner.
Your freelance partnership agreement would require you to mention the bank details for the partnership. All transactions related to the partnership should be met through this account. This is a legal requirement. This will also ensure that everything is transparent between you and your partner.
The freelancing agreement should include the responsibilities of both partners so that there are no disputes.
When you enter into a freelance partnership agreement, you need to keep in mind the laws of the state, the profit-sharing between the partners, the duration of the agreement, and the type of partnership. You should understand everything there is to know about business partnerships.
Get the right template from Bonsai and watch your partnership business grow!