Business Due Diligence

Five things to be aware of in your business due diligence affairs

Five things to be aware of in your business due diligence affairs

Five things to be aware of in your business due diligence affairs

When conducting due diligence on a target business the main goal is to evaluate every detail of its affairs including staff, turnover and if the business has any outstanding debt.

The reason is to allow you to make an informed decision on a potential acquisition. In this article we look at some of things that you should be aware of when conducting business due diligence.

1. Create a Virtual Data Room

There can be a lot to go through when conducting business due diligence and to make it easier and more efficient it is a good idea to view it all via a virtual data room.

Having a virtual data room can be used as a central hub for all the pertinent information that due diligence experts can search, analyse, and evaluate. It can also help to speed up the process, especially if there is a due diligence checklist to run through.

2. Business Structure and Best Practices

Another key area of business due diligence to be aware of is the company’s business structure, processes, and best practices.

This should include names of all the board members, bylaws, minutes of previous meetings as well as shareholder information and company organization chart.

Also, you need to check any recorded history of partnership agreements with suppliers and vendors, it can be good to check the companies press releases and public communication where they have been named.

3. Investigate Business Finances

One of the biggest parts of business due diligence is the company finances and here the accounting expert will want to see a detailed record and all up-to-date finances.

This will include profit and loss statements, tax fillings, annual reports, and accounts payable statements. They will also want to see the business forecasting for performance including projected profit and financial targets.

4. Review Company Assets

Company assets is another area that will require detailed business due diligence which ensures the company can provide evidence that they own their intellectual property.

This part of business due diligence helps to understand the economic value of these assets and that there is no risk of liability of infringement.

Lastly, it is good practice to complete a detailed inventory of the business’s physical assets which might include office equipment and supplies as well as manufacturing or engineering equipment for example.

5. Outstanding Legal Proceedings

Finally, it is important to undertake business due diligence to identify if the company has any ongoing or unresolved legal proceedings that could arise once the acquisition has been completed.

These issues can be with current or past members of staff as well as customers, suppliers, or vendors. Any unresolved lawsuits will often end up being a deal breaker and could be costly to you in the future.

Speak to the experts

To learn more about conducting business due diligence, why not speak to one of our team today? At The Stan Lee we have a fantastic team of expert industry professionals who can help ensure that any business due diligence is done correctly and efficiently. You can email us at info@thestanlee.com or call directly on 020 3778 0973.

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Why Do You Need Business Due Diligence When Buying or Selling The Business

Why Do You Need Business Due Diligence When Buying or Selling The Business

Why Do You Need Business Due Diligence When Buying or Selling The Business

Undertaking business due diligence is a vital step when it comes to buying or selling a business, simply put business due diligence means fact-checking a potential opportunity to ensure that everything is as described or advertised.

Business mergers and acquisitions happen all the time and it would be unprofessional not to mention risky for anyone not to undertake proper due diligence. Below we list some of the reasons why you need business due diligence when buying or selling a business?


Checking the finances is one of the most important parts of business due diligence as you need to have a clear understanding of the company profile.

What do their financial goals look like as well as their assets and outgoings – how do they compare similar businesses operating in the same marketplace?


While we’re talking about the marketplace this is another key area to look at. What are the company’s expectations for the future and who are they up against? It is also a good idea to look at past and present sales figures as well as what they forecast for the future?

Clients & customers

Another area of the business to pay close attention to will be the customers which if you will inherit or pass on. As such you might need to revisit the agreements that you have in place with these customers, are they fair or do they need to be adjusted to meet your own business goals.

Business operations

You should have a clear overview of the operations side of the business, this will include any significant processes that affect the day to day running of the business.

You will have to look at how the management team and staff are structured as well as assess and view all suppliers and on-site equipment. Is everything in good working order or does certain machinery or equipment need updating?

Do your homework

For the average UK consumer, you have a certain level of consumer rights, this means that if you purchase a product or service that doesn’t deliver or promote what it should you have the right to a replacement, repair, or refund.

Buying or selling a business is a little different in that if you don’t do your due diligence thoroughly it can be much harder to undo a contract or agreement later down the line.

Contact Us

For more information about business due diligence, you can speak to one of the team here or call us direct on 020 3778 0973 or email info@thestanlee.com

Our team of experienced professionals will be able to assist you in all areas of business due diligence and advise you on what to look out for.

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Five things to consider when undergoing business due diligence

Five things to consider when undergoing business due diligence

Five things to consider when undergoing business due diligence

Company acquisition or mergers can provide a huge boost to the economy while at the same time creating new jobs and career paths. However, they can be risky if the proper due diligence is not undertaken which may cause financial instability. In order to follow the right process below, we have listed five things to consider when undergoing business due diligence.

1. Don’t just crunch the data

Data is very important when undergoing business due diligence and it can be easy to get fixated on the number rather than extracting and analysing the data which will lead to logical business decisions. Keep the data analysis simple and ensure that it will provide you with a clear answer as to whether you should proceed with the merger of acquisition. Your due diligence should have a specific goal and aim that will help make your decision an easier one.

2. Hire the right people

Business due diligence requires specialist knowledge and it is, therefore, important to have the right people and professionals working with you. Whether you are looking to sell or acquire an existing business and depending on the business decision you are making will demand a skill set that could range from marketing specialists to accountants or tax professionals. At The Stan Lee, we have a number of experts who can help with your business due diligence – from helping to get the precise decisions to getting leverage for valuation and negotiation.

3. Consider uncertainty

Due diligence is about weighing up the risk. The answer to whether you should move forward with a merger or acquisition lies with the uncertainty that the future holds. The time you spend undergoing your business due diligence will have a bearing on the future decisions, goals and return that your newly acquired business will face. Considering uncertainty is not a bad practice, and it is one that will ensure you make the right decision in the long run.

4. Look past the numbers

You’re in business to make money so it is understandable that the figures should add up. Numbers will help you make informed business decisions, deliver on your goals and market performance as well as hit a positive ROI. However, analysing the numbers is not the be-all and end-all when undergoing due diligence so it is important to look beyond them at other aspects of the business such as the experience levels of the staff and logistics.

5. Be ambitious but realistic

Large companies have the benefit of a CFO to handle all the due diligence and other financial matters, but CEOs also like to take a large part of the responsibility for making important business decisions. Given that their role is central to the business they need to find a balance between being ambitious and being realistic. It can be hard to see the woods for the trees if the business proposition is too good to be true.

For more information on undergoing business due diligence, you can speak to one of the team here or call us direct on 020 3778 0973

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