When it is time to sell distribution business you have to be prepared for the due diligence phase. This comes after the issuance of the Letter of Intent. Buyers will want to dig deeper into your business to ensure it is worth acquiring. Our team at So-Cal Business Brokers will see to it that buyers don’t find anything that might force them to drop out. We know exactly what buyers will be looking for in a distribution business and we will ensure your business is in the best shape before getting to this phase. But what can you really expect in the due diligence stage?
Letter of Intent
The due diligence phase usually starts after the Letter of Intent has been issued. This document, although not binding, includes various details about the conditions of the buyer. Our business broker will help you negotiate the terms before accepting the Letter of Intent. Some of the details we help you negotiate is the time period for due diligence. Some buyers will want to spend a lot of time in due diligence. Although due diligence is the only way they can investigate your business, we see to it that the due diligence period doesn’t delay the sale. Based on the size of your business we will be able to determine the fair amount of time it would take to complete due diligence. Our input will guarantee that you sell distribution business fast.
Due diligence is the only chance buyers have to determine if buying your business is a good idea. As a result they will be quite thorough. They will want to look at your business’ financial performance, operations, customer contacts, legal and tax compliance, assets, intellectual property and a range of other details. Our job as your representative is to ensure you are not exploited. We have been selling businesses for more than two decades and we know exactly what is important in due diligence and what is wrong to ask for.
It is also common for a buyer to want to do the following:
- Observe operations of your business
- Analyze the business’ finances
- Examine the procedures and processes
- Evaluate the risks that are associated with buying the business
Considering how sensitive the information buyers will unveil in due diligence, you have to ensure they will not leak what they learn. The first thing our business broker will do is draft a foolproof non-disclosure agreement. Every qualified buyer will be required to sign the NDA before being allowed to review your business. Our team will also help you review the documents that will be reviewed by buyers before giving them to buyers. We will also help you answer questions from buyers the right way.
We genuinely want to help you sell distribution business fast and for the best price. Contact us today to learn more about our services. We offer a free consultation with our business brokers.