Questions to Ask Before Buying a Business

Questions about earnings

Ask the seller to walk through every add-back line by line, and to explain any month where revenue moved more than 20%. Ask how revenue is recorded and when it is recognized.

Questions about dependency

Which customers would leave if the owner left? Which employees hold the relationships and the licences? What happens operationally in the first week after closing if the owner is unavailable?

Questions about the future

What capital expenditure is coming due? When does the lease expire and on what terms? What pricing changes have been made recently, and what happened to volume afterwards?

Frequently asked questions

When should I ask for tax returns?

After signing an NDA and before spending money on professional diligence. A seller unwilling to share returns at that stage is a meaningful signal.