Why is it crucial to support business ties?

| Apr 15, 2021 | Business Law |

As a business owner, it is understandable to prioritize the health, growth and safety of your business. But this often entails more than people first think. For example, did you know that the health of your business directly relates to the health of your business partners?

In general, you should prize and prioritize your business ties. But why? What do they do for you in the long run?

Where to use litigation

The Balance discusses how litigation differs from other resolution methods. Litigation is a good option if you are in a difficult legal situation, or if a lot of assets got tied up in your case. Essentially, complex and volatile cases often do well with litigation.

But the biggest downside to taking someone to court is the fact that you will almost certainly burn your bridges. This may not seem like a big deal at first. To many, it often looks like a reasonable sacrifice. But the issue with businesses – especially small businesses – is the interconnectivity between them.

Why it is an issue

If you lose your ties to one business, you also lose your ties to their close partners and their consumer base. Customers that go to both of you but are more loyal to the other business will almost certainly drop you, too. Then, they will tell their friends, family and colleagues.

In essence, one bad decision and one burned bridge can have a butterfly effect. This is even more true in small towns or communities that have tightknit small business groups. So you always want to try for an alternative dispute resolution method where possible, to preserve these ties.