Dr. Roxanne Arnal, CFP®
Are you considering joining another optometrist in an ownership position? This is what I call a business marriage . It’s a coming together of two or more people to operate a business and when two or more people come together, we open ourselves up to great opportunities and also potentially disastrous experiences.
The Good
Let’s face it, we are greater together. When we can tap into the collective brain power of more people, we have the ability to create exceptional things. For an Optometric practice, this can include the ability to grow at a faster pace, share in responsibilities, and to even split up management duties. Which can all be good things.
The start to any great marriage is a strong relationship built out of trust and understanding. It requires honesty and a common vision.
The Bad
We all begin our business marriages as friends. We all start with a mutual respect for each other and recognizing our perceived strengths and weaknesses. Notice that I said “perceived”. But have you had the tough conversations? Have you reviewed how you may respond to bad things happening?
Have you undergone serious strain in this relationship and worked through it to find resolution when things got hard or you disagreed? This is where things can start to fall off the rails.
When I was a practicing Optometrist, I believed that my new partner would be a great co-manager because they enjoyed handling team member issues, where I had grown weary of it. My new partner had also worked as my associate for over five years and I assumed they understood my management philosophy- the one that permitted us to grow exponentially.
Turns out I made a lot of assumptions and failed to recognize the need for honest conversation. It wasn’t that either of us was knowingly misleading the other. It was the result of our perceived understandings and expectations.
Expectations Lead to All Sorts of Misery
When was the last time someone let you down? More likely than not, they had no idea what you were expecting of them and therefore it became virtually impossible for them to meet those expectations. And hence frustration ensued. Emotions rise to the surface and we may or may not move on. Even when we do move on, we rarely forget. Now we are keeping score.
Step One
Similar to marriage preparation courses offered at most churches, a business marriage needs proper planning. Working with a qualified advisor to walk you through all that might go wrong and to bring everyone’s expectations to the surface is step one.
With our clients that are considering a business marriage, we work through a thorough process of interviews and mediation to help them prepare the shareholder/joint venture agreement template to take to their lawyer for drafting. Important conversations that need to be had before any hardship may surface.
Consider all the options and the ‘what if’s’. No one ever starts their day thinking “Today is the day I’m going to get in a car accident and not be able to go to work for 6 months”. But it has happened- then what?
Legal Execution
I’m a firm believer that any buy/sell agreement should not be executed without the contingent signing of the shareholder/joint venture agreement. Lawyers are great for helping us get through the paperwork, but I will caution you that not all lawyers are of equal competence in this subject matter and a great corporate lawyer executing your buy/sell agreement will often place less importance on the shareholder/joint venture agreement. I challenge you however, that despite looming deadlines, the desire to quickly create a clean year end, or to make the bank deadline, all of these things are less important than having the rules of your business marriage clearly defined and executed. Choosing the right partner in marriage and business both require time, good communication, and the proper paperwork.
Advisory
As your Chief Financial Officer, I’m here to help you create a successful business marriage. Personally, I have lived the results of a poorly created (and never executed) shareholder agreement and a bitter business divorce. I have witnessed other businesses blow up because they were all friends until one partner just stopped coming to work. My experience with the bad has proven that we can’t leave something so critically important to chance.
I help you manage a team of financial professionals and ensure that you have thought about the potential issues and opportunities. Helping you succeed is our focus.
Have more questions than answers? Educating you is just one piece of being your personal CFO that I offer. Call (780-261-3098) or email (Roxanne@claritywealthadvisory.ca) today to set up your marriage prep.
Roxanne Arnal is a former Optometrist, Professional Corporation President, and practice owner. Today she is on a mission to Empower your Finances.
These articles are for information purposes only and are not a replacement for personal financial planning. Everyone’s circumstances and needs are different. Errors and Omissions exempt.
ROXANNE ARNAL,
Optometrist and Certified Financial Planner
Roxanne Arnal graduated from UW School of Optometry in 1995 and is a past-president of the Alberta Association of Optometrists (AAO) and the Canadian Association of Optometry Students (CAOS). She subsequently built a thriving optometric practice in rural Alberta.
Roxanne took the decision in 2012 to leave optometry and become a financial planning professional. She now focuses on providing services to Optometrists with a plan to parlay her unique expertise to help optometric practices and their families across the country meet their goals through astute financial planning and decision making.
Roxanne splits EWO podcast hosting duties with Dr. Glen Chiasson.
