Boise Idaho Business Guide: Making the Best Choice
If you have found yourself a really great Idaho business and you’re a serious buyer at this point, you should work with the seller to review important financial documents to support their claims.
This due diligence will help you confirm if the Idaho business is worth their asking price, possible issues, profitability and whether it matches your lifestyle needs.
Common Due Diligence Questions to Ask
Going through due diligence is only as valuable as you make it. The seller isn’t going to tell you what to look for and may work to hide the reason for the sale.
Even if the seller is running because the business is not making enough to pay for their own personal bills, doesn’t mean that the business is bad. Maybe their bills are ridiculous! Or maybe they are not hip with the internet trend and are losing out on thousands of customers who just can’t find them on google.
You will have to find these things out yourself through research.
Some Examples Include:
- Organizational documents for the business (e.g. incorporation docs, certificates of good standing, business licenses, etc.)
- Previous 3 years of business tax returns
- Current year income statements, balance sheets, and cash flow statements
- Revenue broken out by customer for the last 3 years
- Information on existing business liabilities
- Customer lists with proprietary information blocked out as necessary
- Existing contracts – can these be assigned to the new owner?
- Commercial lease or other property documents
- Rent rolls if the property has tenants
- Uniform franchise disclosure document (if the business is a franchise)
- Employee and manager information
- Marketing and advertising materials
- Legal records for pending litigation, if any
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