Due Diligence and Risk Assessment
Due diligence is the process of thoroughly reviewing the business to determine the likelihood of its future success. With an existing business, you will need to inspect the building or office space, the inventory and equipment, the company brand and products, as well as gain insight into the current customer base, vendors, competition and market. You will also need to carefully look at the books. Before seriously considering a business, take a close look into its financial history. This should include reviewing tax returns, balance sheets, cash flow statements, sales records and accounts receivable, accounts payable, debt disclosures and advertising costs.
To read "The Fundamentals of Buying a Business in South Dakota - Part 3" - click here.