Is profit sharing the major cause if rifts in partnership business?!

[Min George]

We all see some partnership businesses start out well and before you could know it, there is a split. And most times, trying to find out what caused the split, one gets to find out that it is profit sharing that caused the split.

The question is, "why does profit sharing cause so much splits in partnership business"? How can it be minimized?

 

[Kera]

Money inspired by tendencies of greed is the major reason why some partnership businesses fail. Almost 80% of partnerships that fail is due to that.

 

[Xtynehappy]

I can say that the sharing of profit and bearing of losses is the major cause of wrangles on the partnership business.

 

[Pearl]

There is no other thing that has the ability to cause problems in partnership businesses than profit sharing. It even turns out bloody sometimes.

 

[eLdavis]

Profit sharing is definitely one of the reasons but I don't think it's the major reason or only one. In most cases there is usually a legal agreement before they begin their partnership and within this agreement, how the profit should be shared has been stated, though most people still fight over this. In some cases, one of the major reasons is their differences when it comes to ideas.

 

[Augusta]

More like one of the most outstanding rift. A lot of times I know money is always the cause of division

 

[Niyi Br]

When the partners in the business are able to stay above money related problems, the partnership would surely last.

 

[Augusta]

When the partners in the business are able to stay above money related problems, the partnership would surely last.

Yes this is why you should know the kind of partner you are partnering. Don't try to partner with greedy crafty people to avoid manipulation

 

[Suba]

Unequal profit sharing is often considered unfair by one of the partners, so to minimize the risk of splits in the partnership, a clear and detailed contract must be made.

 

[Trush Jodie]

Many people that partnered together are always fighting because of money. No other thing can make them fight more than that.

 

[King Belieal]

Even partnerships that involve siblings have been torn apart because of sharing formula. It is always the major cause of problems in partnerships.