Due Diligence – an essential part of buying a business

Due diligence forms an essential part of buying any business as it provides a bridge between making an offer to acquire a business and completing the deal at an agreed price.

Most childcare business sales will be completed “subject to Due Diligence”.

The scope of the due diligence investigation will vary and to some degree depend on the information provided by the seller and Business Broker prior to any offer being made. It genuinely pays to get the right information from the right people for a smooth sale to proceed.

Preparation of the business sale will help achieve a successful due diligence process. By planning for the information a buyer is likely to request, it can be prepared and presented in such a manner that the questions are answered accurately and promptly. For example, having Profit and Loss information, GST statements, Occupancy reports, staff details and inventory lists prepared will ensure all parties can move through the sale process with confidence.

The key to a successful sale is preparation, presentation and providing the information required by a buyer and their stakeholders such as banks, solicitors and accountants in a professional and timely manner.