How to Sell a Business: Due Diligence

About Due Diligence

When a buyer makes an offer on your business, there is a period of time that follows where the buyer researches your business and further investigates your business. This period of time “typically” lasts 2-4 weeks and is called “due diligence.”

Typical document requests and items investigated by buyers during this time period can include the following:

  • Financial Statements
  • Tax Returns
  • Bank Statements
  • Leases – premise lease, equipment leases, etc.v
  • Any third-party contracts, such as supplier or vendor contracts
  • Sales and Use Tax Reports
  • Staffing- and payroll-related documents: job descriptions, employment contracts, etc.
  • Insurance-related documents: workers compensation, health insurance, liability insurance, etc.
  • Equipment inspection
  • Licenses and permits
  • Marketing, advertising, and promotional documents
  • Environmental documents and inspections
  • Franchise related documents

The list above will not be typical for every business. Every business will have its own unique due diligence structure.

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