Due Diligence
Due diligence is the research you undertake when you buy an existing business. It’s the process of assessing the financial information regarding the business you are looking to buy.
Buying an existing business is different to establishing a greenfield site.
When you buy an existing business, you will be provided with certain financial information from the vendor. This will show you the financial performance of the business prior to the sale. This can give you an insight into how the previous owner ran the business.
From this you can discover:
- The level of sales the previous owner achieved,
- The costs they incurred,
- The profits or losses they made,
- How much tax they paid,
- Areas where you may be able to improve.
We will work with you to review the information provided and assess it from a financial perspective. We can see how the numbers ‘stack up’ and assess whether it will be a worthwhile investment for you. That means, we’ll check if you’ll get a decent Return on your Investment.
We will also check the expenses of the business and assess whether you need to incur the same level of costs.
There have been many times we have found expenses which the previous owner incurred which you won’t need to worry about. This gives you the chance to do better than the previous owner and take advantage of the opportunity.
Franchises we’ve worked with
