Partnership Advantages and Disadvantages

Simply stated, a business partnership is a business with many owners, each of whom has invested in the business. Some partnerships include individuals who work in business, while others may include partners who have limited participation as well as limited obligations.

Before starting a partnership, you must determine what kind of partnership you want. Among them is the General Partnership, consisting of partners who participate in the day-to-day operations of the partnership, who is responsible as the owner of debts and lawsuits.

Limited Partnership, which has one general partner that manages the business and one or more limited partners who do not participate in partnership operations and who do not have responsibilities.

And Limited Liability Partnerships are similar to limited partnerships, but there may be a number of general partners.

Strengths and Weaknesses of Business Partnership

Business partnership or partnership is a form of cooperation of two or more people who jointly own a business with the aim of making a profit.

Commonly known forms of partnership are firms and Commanditaire Vennootschap (CV). A firm is a form of partnership in which all partners actively participate in running a business and are jointly responsible.

Whereas CV is a form of partnership that recognizes the existence of active and passive or limited partners. Active partners are partners who own, operate, and manage the business and have unlimited liability to the debt of the partnership.

Whereas limited partners are partnership members who do not play an active role in managing the company and its obligations in partnership debt are limited to the money invested.

Business partnerships do have many advantages. This makes partnership business one of the most common ways to achieve success in business.

But unfortunately, despite having many advantages it turns out that partnerships can also have weaknesses. Even statistics show that up to 70% of business partnerships ultimately fail.


  • Establishments that can be done easily, in an informal way if deemed not necessary to make the partnership business formal and registered.
  • Skills that can complement each other's limitations in doing something in running a business.
  • Profit sharing can be done more easily, based on mutual agreement determined at the beginning of the collaboration. Profit sharing is not necessarily the same as capital comparison because workloads and responsibilities in running a business can be different.
  • Ease of finding passive or limited partners. Limited partnership is considered as a form of excess partnership business because it can accommodate people who are willing to make investments without wanting to be directly involved in business. And willing to take risks only limited to the money invested.
  • Greater active capital accumulation. Especially if coupled with commitments that reach personal property, it will allow business expansion because it is greater capital.
  • Flexibility in adapting to the business world and speed in making decisions.


  • Unlimited liability, which requires the owner to account for his obligations to personal property (except passive partners).
  • Capital accumulation is still not optimal. Although the form of partnership business is still better in seeking capital that is greater than individual partners, but this form of business is still considered less effective when compared to individual businesses.
  • Difficulties to leave the partnership, because in a partnership if you want to withdraw usually shares that want to break away must be sold to another partner. In fact, often other partners do not intend or do not have sufficient funds to buy shares of partners who want to get out. So that partnerships often have to be dissolved, which makes the problem more complicated, especially since the name is often a trade mark that is remembered by customers or consumers.
  • Less sustainable, can occur if the heirs of the deceased party do not want to partner with the heir's partner.
  • More potential for conflict.

Tips for Choosing a Business Partner

A business partner certainly has an important role to support your business with the skills needed. It can also be interpreted that the business partner is the first person you want to go to when you want to divide your tasks in business. Then how to choose the right business partner or business partner? Choose partners who have the following 10 criteria:
  1. Have the same vision and mission to avoid conflicts.
  2. Have the same value, so they can help each other.
  3. Have the same goal, or are one-way.
  4. Choose people who "get-it", which means people who are serious about their goals and serious about success. They don't treat life casually or waste time on things that are not useful.
  5. Choose people who are competent in their fields.
  6. Have high moral standards, so that will make someone an ethical entrepreneur.
  7. Able to complement and complement each other.
  8. Able to be calm and be able to motivate.
  9. Have a strong desire to continue learning.
  10. Honest and trustworthy.

How, are you interested in doing a business partnership? What is important for you to pay attention to is that you must be careful in running a business partnership if you only act as a partner who gives money, does not give time, and does nothing for the business. Because one day, the business will be controlled by your partner who has the time.

By spending time on business, someone will know more about the ins and outs of the business. Running a business does require the right skills and strategies. To make managing your business easier and more practical, use the help of an accounting application so that business finances run smoothly.