Don’t Save Due Diligence Until It’s Time To Sell

When it comes to the process of buying and selling a business, there’s the sellers side and the buyers side of the deal. Because selling a business can be a lengthy process, it’s helpful for buyers and sellers to be knowledgeable about each other’s perspectives.

Due diligence is typically performed by the buyer during the process of selling a business. Due diligence is the thorough process of examining a business to see if what you see is what you get with the purchase. Because of the critical nature of due diligence, current business owners and future business sellers may be wise to consider incorporating their own due diligence as part of their annual business review.

Why would a business owner want to go to the trouble of performing due diligence on their own company? There are a couple reasons for this. The first is that business owners may find themselves in a situation where they need to sell the business quickly due to unexpected circumstances or an offer from a buyer. If this happens, a seller who has already performed due diligence will know exactly where the company stands.

From the buyer’s and seller’s perspective, there are a few key areas to examine during due diligence. These areas include:

  • Marketing/Customer Base
  • Financial
  • Legal
  • Environmental
  • Management/Employees

Examining these key areas can help sellers discover if there are any potential pitfalls or problems before a deal is on the line. Sellers that are proactive in tracking their company’s progress and set backs will be well positioned when it’s time to sell or when that unexpected offer is on the table.

Business owners who successfully navigate performing their own due diligence are set up for success when it’s time to sell. Companies with solid financial, legal, environmental, employee, and marketing due diligence will sell at a higher price in less time and buyers will be impressed. At Regal Consulting Corp., our professional team of business brokers has years of experience helping clients sell businesses in New Jersey, Pennsylvania, New York, and Connecticut. Our expertise, integrity, and marketing tools ensure we price your business appropriately, identify a qualified buyer, and close the deal. Call us today and we can begin with a thorough business valuation and exit plan.