If I only knew then what I know now
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If I only knew then what I know now
Often times in life we come to a point where negotiations must take place in order to resolve issues that have come between contracted parties. In 2001 I formed a partnership with a local group of entrepreneur’s to open a new restaurant. They owned the property, financed the building and were responsible for most of the startup costs. We made the usual contract arrangements for profit share, building and equipment costs, and operational controls. I set up the entire staff and restaurant floor plan layout to get the operation off the ground. I designed the menu, trained the staff, and oversaw the day to day operations. In the first year we were able to see a 5% profit over the budget and our investors were very happy with their ROI for year one. All parties planed and set the year two budget however in this negotiation it was contracted that the operator (me) had to sign off and approve the final draft before it was approved. The investors had no restaurant business experience so they lacked the insight to keep the budgeting process realistic, as it pertains to being profitable and sustainable. We pretty much negotiated as things came up and I addressed the things that were important to running the operation, but I did not research or look at the big picture that allowed me to consider potential risks or clauses that protected me if the partnership was to be dissolved.
In this class I have learned about how important it is to build a relationship of trust and understand your partners. This means that in depth research of who they are and potential past partnership outcomes would have really been helpful prior to forming this partnership. I have learned that weighing the complementary strengths, chemistry, and common customer-base is helpful in setting the tone of the needs and desires of forming a partnership. By failing to do this I was not prepared for the momentum shift in our partnership when their greed became
If I only knew then what I know now
Often times in life we come to a point where negotiations must take place in order to resolve issues that have come between contracted parties. In 2001 I formed a partnership with a local group of entrepreneur’s to open a new restaurant. They owned the property, financed the building and were responsible for most of the startup costs. We made the usual contract arrangements for profit share, building and equipment costs, and operational controls. I set up the entire staff and restaurant floor plan layout to get the operation off the ground. I designed the menu, trained the staff, and oversaw the day to day operations. In the first year we were able to see a 5% profit over the budget and our investors were very happy with their ROI for year one. All parties planed and set the year two budget however in this negotiation it was contracted that the operator (me) had to sign off and approve the final draft before it was approved. The investors had no restaurant business experience so they lacked the insight to keep the budgeting process realistic, as it pertains to being profitable and sustainable. We pretty much negotiated as things came up and I addressed the things that were important to running the operation, but I did not research or look at the big picture that allowed me to consider potential risks or clauses that protected me if the partnership was to be dissolved.
In this class I have learned about how important it is to build a relationship of trust and understand your partners. This means that in depth research of who they are and potential past partnership outcomes would have really been helpful prior to forming this partnership. I have learned that weighing the complementary strengths, chemistry, and common customer-base is helpful in setting the tone of the needs and desires of forming a partnership. By failing to do this I was not prepared for the momentum shift in our partnership when their greed became
References: Garret, G.A. (2010). World Class Contracting (5th ed). Riverwoods, IL: Woltser Kluwer