Buying a Business
Buying a business is a huge decision which requires careful analysis. Even with the many advantages purchasing an existing business offers, it is a venture that should not be entered into lightly.
An existing business offers established relationships with regular customers and suppliers. While these established relationships make the business less challenging to run from the time of purchase, they may also cost more money.
Due Diligence Checklist
Due diligence is an investigation into the business you are considering purchasing This due diligence checklist will help you make careful consideration of various areas and issues before signing on the dotted line.
Before undergoing this lengthy and complicated process, it is strongly advised that your attorney and accountant is present to assist and guide you while completing this checklist.
Legal Due Diligence – Investigating legal contracts and financial documents to find financial risks, losses, or existing lawsuits.
- Sales contracts,
- Purchase agreements,
- Employee, purchase, and contractor agreements,
- Trademarks, copyrights, trade secrets, and patents,
- Business registration documents.
Operational Due Diligence – Investigating operations of the business, the market, and competition.
- Compare first-time buyers to regular, frequent, or repeat customers,
- Determine which day and hours most purchases are made,
- Determine which products and services are most popular,
- Review current marketing tactics and strategies and compare them to those from the past,
- Review previous sales and discounts to determine which promotions were most successful,
- Research the location of the prospective business. Who are the target customers, what is the economy like, who would be your competitors,
- Survey the surrounding public to determine what potential customers and suppliers think about the business you wish to enter,
- Research if the business’ industry is growing
Product Due Diligence – Learn about the product or service your potential business will provide.
- Learn the cost to create the product,
- Determine how profitable the product has been,
- Look at growth rates,
- Learn what you can do to improve the product to make it more in demand and profitable.
Human Capital Due Diligence – Look at the staff and management, investigate the qualifications necessary to work in said business.
- Create a list of employees, their positions, skills, and wages, compare these items to similar positions in the same industry,
- Learn what the company’s benefit plans are,
- How did the business structure bonuses, sick leave and time off policies,
- Was there an employee handbook in place?
Paul J. Burkhart
One of the biggest causes of failure is not hiring a business attorney to help start your business; Paul J. Burkart is well versed in due diligence. He will be there with you each step of the way helping you venture into your new business.
He will ensure you are choosing the correct corporate entity, not using someone else’s trade name, accounts are not commingled, intellectual property is protected, ensuring there are adequate employee agreements, understanding key contracts, and complying with state and federal security laws.
Start your business on the right foot with experienced business attorney; Paul J. Burkhart.
Our team assists both individuals, and business clients with all their legal needs, including business and Corporate Transactions, Business/Commercial and Civil Litigation, Real Estate, Intellectual Property, Family Law, and Estate Planning matters. We are a full-service private law firm ready to assist you with any request, large or small. Call 561-880-0155 or visit our website.
Law Offices of Paul J Burkhart, PL
800 Village Square Crossing
Palm Beach Gardens, FL 33410
Phone: (561) 880-0155
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