Practical template
Business Acquisition Checklist Template
Before you buy any business, check whether revenue, lease rights, customers, staff, suppliers, licenses, assets, and liabilities will transfer under new ownership.
A business acquisition is a purchase of future cash flow, not the seller's past effort. This due diligence template helps you identify which claims can be proven and which risks need price protection, holdbacks, or rejection.
Due diligence framework
- Define exactly what is being purchased: assets, stock, lease, inventory, goodwill, contracts, and systems.
- Verify cash flow from source records rather than seller summaries.
- Identify what changes after ownership transfers.
- Separate assets from liabilities.
- Stress-test price against conservative downside assumptions.
Cash flow verification
- Match reported revenue to bank deposits, tax filings, POS exports, invoices, and platform payouts.
- Normalize owner salary, family labor, unusual expenses, deferred repairs, and missing payroll taxes.
- Calculate buyer cash flow after debt service, working capital, and realistic owner compensation.
Lease verification
- Confirm assignment rights, landlord approval, renewal options, rent increases, guarantees, and permitted use.
- Compare remaining lease term with the payback period needed to recover the acquisition cost.
- Identify repair duties, CAM, taxes, insurance, relocation, demolition, and default clauses.
Asset vs liability breakdown
Assets
Equipment, inventory, customer database, phone number, website, social accounts, permits, contracts, procedures, supplier accounts, and lease rights.
Liabilities
Taxes, supplier balances, employee claims, deposits, gift cards, warranties, refunds, loans, liens, lease guarantees, and deferred maintenance.
Negotiation risk checklist
- Require lease approval before closing.
- Use holdbacks for unresolved liabilities.
- Exclude obsolete inventory.
- Tie part of the price to key employee retention.
- Require seller training and transition support.
- Walk away if material claims cannot be verified.