Before purchasing a business you will want to go through the due diligence process with a help of a lawyer to consider the following legal issues:
- Terms in the sale of business contract;
- Existing lease agreements and any obligations you may have under them;
- Licenses attached to the business that you may have to reapply for or renew;
- Government regulations and requirements such as health and safety, water and sewerage;
- Employees – think about whether you will be keeping staff or ‘cleaning house’. You will need to think about existing employment contracts, entitlements and workers compensation;
- The business’s suppliers – often businesses have a strong relationship with their suppliers that have been established over time, and you will need to consider these and how you will deal with them;
- What business assets are included with the sale and what their value is. This might include equipment, furniture, intellectual property and stock.