Due Diligence When Selling a Business

For many business owners, due diligence is one of the least understood and most stressful parts of the sales process. Yet it is also one of the most important.

Understanding what to expect during due diligence when selling a business will help you stay in control, reduce delays and keep the deal moving forward.

What to Expect During Due Diligence When Selling a Business

Due diligence is the process where the buyer verifies all aspects of the business before completing the sale. It involves reviewing financial, legal, operational and commercial information to ensure everything is accurate and transparent.

Buyers want to feel confident that they are getting what has been promised and that there are no hidden issues.

What Buyers Will Review

Here is what most buyers will look at during due diligence:

📊 Financial

Profit and loss accounts
Balance sheets
Cash flow forecasts
Bank statements
Tax returns
Debt and liabilities

📄 Legal

Business ownership and shareholding
Contracts with clients, suppliers and employees
Intellectual property or licensing
Any ongoing or historical legal disputes
Regulatory compliance

⚙️ Operational

Systems and processes
Employee roles and salaries
Premises and lease agreements
Key suppliers and dependencies
Technology or software used

How to Prepare for Due Diligence

The smoother your due diligence process, the more confident your buyer will feel. This reduces the chance of last-minute changes and keeps the sale on track.

Here are some key tips:

✅ 1. Get Your Documents in Order

Organise all your key business documents into folders and be ready to share them securely. This includes accounts, contracts, licences and anything material to the business.

✅ 2. Be Honest from the Start

If there are any issues such as tax disputes, outstanding debts or one-off losses, disclose them early. Buyers value honesty and can work with challenges, but surprises late in the process often cause deals to fall through.

✅ 3. Clean Up the Business

Ensure your books are accurate, personal expenses are clearly separated and everything is properly documented. This builds buyer confidence and reduces unnecessary questions.

✅ 4. Use a Checklist

At Novus, we provide every client with a tailored due diligence checklist. This keeps the process focused and prevents delays caused by missing or incomplete information.

Why Due Diligence Can Make or Break the Deal

It is not uncommon for deals to collapse during due diligence. This is not always because the business is weak, but because the seller is unprepared.

Remember, due diligence when selling a business is about reducing the buyer’s risk. If your business is organised, profitable and well documented, the buyer is more likely to complete at the agreed price and terms.

📞 Ready to Sell with Confidence?

At Novus Business Brokers, we guide you through every stage of the sale, including preparing for due diligence when selling a business. We help you stay ahead of questions and give buyers the confidence to move forward.

📞 Call us: 0203 883 1397

📧 Email: info@novusbusinessbrokers.com

Or click below to request your free, confidential valuation and find out how buyer-ready your business is.

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