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Last Update: Thursday July 29, 2021

Key Idea: Form A Partnership

Host Hattie Bryant says a partnership is a strategy to consider if you need to complement your own skills with something you lack. More... About informal partnerships

Key Question:

A: 

One strategy is to find a person who can do what you can't do.

Q:  Why does the partnership work for Bud and Nicole?

A:  They started right. They had clearly defined roles. Nicole would design the new and Bud would get it made and sell it. Now they say they could switch roles but they don't.

There's a big clue to the answer to this question in what Bud said. When trying to describe why their partnership has made it through thick and thin, he said, "a partnership is not meeting somebody 50-50. A partnership is meeting somebody 90-10."

We've heard others say, "When you don't care who gets the credit, you can make plenty of money." Deferring to the other person, respecting them and putting their thoughts and feelings ahead of your own has worked for these two because they both do it!

We believe that these are both very strong, independent people who do not give up any part of themselves in negotiations with each other. While both of them could probably make it alone, they don't want to. Today they are in this partnership by choice not by necessity so no one feels trapped. This feeling of "I want to be in this together" is essential for creative juices to flow and for the entire team to enjoy a corporate atmosphere of genuine collegiality.

The right partner or group of partners can help but be careful.  Avoid 50-50 Partnerships. 33-33-33 is OK, but 50-50 is an accident waiting to happen. No matter how well you and your business partner complement each other, no matter how clearly you are able to define each other's roles and responsibilities, there will come a point when you fundamentally disagree on an issue. How is that resolved if you are equal owners?  Consider having that discussion now and dispassionately. The ostrich approach won't work here.

Q:
If you are in business with one other person, how do you decide on stock ownership if 50-50 is not a good idea? How can you be fair to the owner with less than 50%?

A:
The purpose of avoiding 50-50 ownership, even if it is 51-49 instead, is to have a clear and frank understanding at the outset of forming the business. Two individuals commit to work hard together to grow a business and decide that if they ever disagree, which one of the two of them will have the final say. This may seem heartless, but there really is no practical alternative. Without this agreement, the business would be frozen and not able to react to changing circumstances. And for obvious reasons, this is not something you want to discuss with your business partner when the disagreement arises.

Ownership and profit distribution are not synonymous. The decision between partners of who should have the final say is independent of salary levels, dividend distributions or proceeds from the sale of the company. These can still be 50-50, protecting the minority shareholder.


Think about it

Can the way Nicole and Bud treat each other be a model for the way you treat every person on your team? Does every person have your deep respect? Are you happy with every person on your team? Can those you are not happy with change? If not, why are they on the payroll?
 

Clip from: Nicole Miller - Fashion & Quality

Nicole Miller on her visit to her boutique in La Jolla.

New York, NY: In this episode we go to the heart of the fashion industry and behind the scenes of Nicole Miller, a fashion house on Seventh Avenue to meet the founders, Nicole Miller and Bud Konheim.  In an industry where even top designers have taken production overseas, Nicole Miller pieces all proudly wear the label, "Made in New York."

It's a stroke of genius for these times, but the reasons go far beyond patriotism. For Nicole Miller, it's all rooted in the fabric of the American entrepreneurial dream: pride of idea, of process, and of execution.  They earnestly try to make women happy and  they are key advocates for causes important to women.

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Nicole Miller Fashions (BK)

Bud Konheim, Co-founder

525 Seventh Avenue
New York, NY 10018
2127199200

Visit our web site: http://www.nicolemiller.com

Office: 2127199200

Business Classification:
Fashion

Year Founded: 1982

Form A Partnership

 HATTIE: Shari Grossman started as an intern and worked her way up to director of licensing.

SHARI: I think that the partnership between Bud and Nicole is very different than anything in any other company of this magnitude and I think that definitely drives the business. I think the philosophy of opening our own stores as opposed to distributing heavily in department stores has also made a big difference. The way our distribution scheme is wholly different than any other designer. So we have gained a very big customer loyalty through that.

BUD: But a partnership is not meeting somebody 50 / 50. A partnership is meeting somebody 90 and let them meet you 10 – but they won't – if they meet you 90 then you've got a locking thing that is like this, it's great.
 
HATTIE (In the studio): What happens when two people have a singular focus?

The power of two is the root cause of success at Nicole Miller. The partnership started with clearly defined responsibilities. Nicole was to design the new and Bud was to get it made. Now they both admit they could almost switch roles.

The LightBulb

The Nicole Miller company wants to move us all up the clothing chain – you know, stop wearing Wal-Mart and start wearing fashion. They want us to stop thinking clothes and start thinking style. They want us to attend to aesthetics. They are chipping away at their goal, working in harmony, and bringing to bear nearly 3 decades of experience. While most fail in this highly competitive and sometimes fickle industry, this pair and their extraordinary team persists, yes even thrives, yet at the heart of it all, the power of two prevails.
 
 
 

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