Partnership Question/ Business Arrangement

Discussion in 'Growing and Managing a Business' started by YoYo, Aug 20, 2011.

  1. YoYo

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    Aug 20, 2011
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    Hi Folks!

    This guy who rents a room from me recently recieved a garuanteed $325/day contract for a very lucrative courier route. He is always behind in his bills so I offered to co-sign for a $25,000 truck loan only if we set up a partnership and I controlled the bank account. His credit is so bad that he got turned down even with my AAA credit rating.

    I told him I would buy the truck on my line of credit only if it is in my name. I told him once it is paid off I will sign the ownership over to him and dissolve the partnership. He agreed to pay me $600/month for helping him.

    He's a good guy and this is the chance of a lifetime but if anything happens I'm screwed. I'm thinking I should get at least 50% of the net profits. I estimate gas, insurance and maintainence will be $15,000/year and I'd like to pay up to $1,500/month on the truck and save $1,000/month toward the purchase of a new one. I believe $2,400/month would be a fair salary for him as the driver. That would leave around $20,000 at the end of the year of which I think I should get at least 50%.

    What do you think? I've never been in business before so I don't even know if I'm approaching this correctly.


  2. Mountain Man

    Mountain Man
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    Jul 14, 2010
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    Must be quite the room mate. How long have you known him? How well do you know him? I think I am missing why you are doing this. Is it to be a good friend? Out of obligation? or because you see an opportunity for some profit?
    First off is there any way he could do this without you? maybe rent a truck for a few months on his own?
    You say if anything happens you're screwed. Things ALWAYS happen.
    Not to sound negitive but If you are set on doing this Plan for the worst and get it in writing. Hope everything works out.

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