As a business person, do you understand about partnership? Partnership is a cooperation between two or more parties in managing and operating a business together in order to achieve profit. Along the way, the parties involved in the partnership distribute responsibilities to each other to be able to run the organization and various revenues or losses that occur in the business. In Indonesia, partnerships are regulated in Government Regulation (PP) No. 17 of 2013 which states that a partnership is a relationship established between two or more people or institutions that have accepted to be able to share the benefits obtained from the business under the supervision of all members or the names of other members. Meanwhile, according to the Business Competition Supervisory Commission (KPPU), the definition of partnership is a form of cooperation in business linkages directly or indirectly, on the basis of mutual trust, need, strengthening, and benefit involving MSMEs or large businesses. Partnerships are certainly different from joint ventures carried out by two or more companies, because partnerships only apply to combinations between individuals. Before forming a partnership, KH friends need to understand what the underlying things are. For example, partnership business structures are relatively easy and inexpensive to form, have minimum reporting requirements, share control over business management, have legal agreements, and are linked to partnership continuity.
Partnership Principle
Not only do partnerships have a foundation, they must also be based on constructive principles. Some of the principles of partnership include:
- Principles of common vision, mission, and goals
- The principle of togetherness or the spirit of mutual cooperation
- Principle of balance
- Principles of fairness and transparency or openness
- Benefit principle
- Sustainability principle
The first step that KH pals need to do to do a partnership is to choose the type of partnership itself. Currently, there are many types of partnerships. However, the most common type of partnership is one that is done jointly, carries out tasks equally, and gains mutual benefits.
Types of Partnerships
Sourced from The Balance Small Business website, some types of partnerships that business owners need to know about include:
General Partnership
In the general type of partnership, all parties are responsible for the management of the business, including managing the company’s debts and receivables. Business profits must also be shared equally. All parties are obliged to resolve any problems that occur, especially legally binding problems.
Limited Partnership
A limited partnership is a type of partnership that consists of general partners whose liability is limited to the amount of funds they provide for the joint venture. Limited partners are usually passive investors (silent partners) who have no role in the day-to-day management of the business. Partners who do not run the day-to-day operations have no liability in terms of debt or other legal issues. However, in terms of profit sharing, all parties are entitled to a mutually agreed portion.
Incorporated Limited Partnership
In a joint limited partnership type, the partners can have limited liability for business debts. However, within this organizational structure, there must be at least one general partner with unlimited liability. Each partner in a joint limited partnership type receives legal protection. So if one of the partners makes a mistake that must be prosecuted, then the other party will be protected from this condition. In other words, this type of partnership is a combination of a general partnership and a limited partnership. If you already understand and choose the type of partnership that will be carried out, then KH friends and prospective partners need to make a Memorandum of Understanding (MoU) or business contract. Thus, every binding right and responsibility will be written and will eventually be legally binding. After that, parties who have succeeded in becoming partners can immediately do business as usual. Related to profit sharing, it will generally be based on the contract that has been signed by each party. Although in partnership activities the distribution of results is carried out equally, but each party must still pay taxes according to their respective calculations. This is because there may be partners who own more than one business.
Partnership Pattern
Partnership pattern is a form of mutually beneficial cooperation between two or more parties to achieve a common goal. Reporting from the book entitled “Theory and Practice of Agribusiness Partnerships” by Sumardjo (2010), there are five types of partnership patterns, namely:
Core Plasma Partnership Pattern
The plasma nucleus partnership pattern is a partnership pattern carried out between companies and farmers or farmer groups. Where the core company provides land, production facilities, technical guidance, management, accommodates and processes, and markets production results, while the partner group is tasked with meeting the needs of the core company in accordance with the agreed terms.
Subcontracting Partnership Pattern
A subcontracting partnership is a partnership between a business partner company and a group of business partners. The business partner group is usually a group that produces components that the partner company needs as part of its production.
General Trade Partnership Pattern
The general trade partnership pattern is a partnership pattern that is carried out between the marketing party and the business group supplying the commodities needed by the marketing party.
Agency Partnership Pattern
An agency partnership is a partnership between a partner company and a small entrepreneur. The partner company (large company) gives special rights to small entrepreneurs to market the company’s goods or services supplied by the partner company.
Partnership Pattern Agribusiness Operational Cooperation (KOA)
The KOA partnership pattern is a business relationship pattern run by partner groups and partner companies. Partner groups provide costs, capital, management, and procurement of production facilities to cultivate or cultivate an agricultural commodity, while partner companies also play a role in increasing the added value of products through processing and packaging.
Benefits of Partnership
With various types and patterns available, partnerships are arguably the best way to accelerate business growth. This is why many people consider entering into a partnership rather than going it alone. In addition, there are many benefits that business owners can enjoy if they go into partnership. By partnering, you will share responsibilities and risks with your business partner, thus strengthening each other’s businesses. Some of the benefits that can be obtained when doing a partnership are as follows:
Greater resources
By involving more people, more ideas are implemented in the business. The workload can be shared with your partners. In addition, business funding is also not borne by only one party. In essence, you will have more people to think about and run the development of the business.
Bringing diverse skills
Because partnering is combining two individuals or business parties, employees or workers from the two parties will automatically come together. So that the human resources will be more and more diverse. This will have an impact on the business you are running.
Helps reduce workload
Partnership is agreeing to cooperate. Therefore, all responsibilities and workloads will be carried out together, both in overcoming operational obstacles, making decisions, and consulting related to business development.
High enough flexibility
Because they contain a lot of resources, partnerships promise more flexibility compared to building everything by yourself. It’s easier to get the results you want because each party has more time and energy to focus on business development.
Reduced tax payment burden
Another advantage of a partnership is that the burden of paying taxes is reduced. Generally, a business partnership will be subject to pass-through tax. This means that your business is not subject to corporate income tax, but each partnership party will pay taxes according to business income. So the amount of tax paid is adjusted to the number of shares owned by each business partner.
KH Contact
Well, that’s the full explanation of partnership activities, starting from understanding, principles, types, patterns to how it works and its benefits.So how, are KH friends already interested in doing business partnerships? The most important thing to note is that KH pals must be careful in conducting business partnerships. You must choose a trusted partner and make the partnership activity efficient and safe by legally binding it in the form of a partnership agreement. For KH friends who are currently or planning to carry out partnership activities but do not want the hassle of making legal documents such as partnership agreements or contracts, you can leave it to Kontrak Hukum. Through the partnership agreement service listed on the page https://kontrakhukum.com/kontrak/, Kontrak Hukum can help you to make and review a partnership agreement contract that suits your cooperation needs. Contact Kontrak Hukum via the following link Tanya KH or via Direct Message (DM) to Instagram social media @kontrakhukum.
