1. Business Profile
- Company Directory (from financial statement)
- Background - brief history of business, current ownership, reasons for sale etc.
- Operations - Details as to what is made and how. Information on operating hours, key skills, core competencies, computer systems, quality control etc.
- Suppliers - information on main materials sourced, availability and whether prices fluctuate. Details on special buying arrangements.
Personnel - refer to personnel section. Indicate importance of owner or other key staff.
- Customers/Markets - indicate number of clients & dependency on key clients e.g.
Client % of Total Shares
C 5% etc.
Adopt similar approach to sales into particular markets e.g. geographical or product type. Include copies of company advertising e.g. Yellow Pages. How does the company market its products?
Competitors - assess level & number of competitors. Review sales trends and margins if appropriate.
Plant - indicate how valued, quality of plant, any future plant required.
Stock - indicate estimated value )excl. GST, excluding damaged or obsolete stock).
Restraint of Trade - How long, what distance.
Vendor Period of Assistance/Consultancy - how long, what terms.
Adjusted summary of financial performance.
- Last 4 years trading and P and L if available.
- Monthly sales comparison year to date with same period last year.
- Indicative aged debtors analysis (for working capital assessment).
- Balance sheet (not usually provided to purchasers).
- Work in progress (if any).
Trading and profit and loss budget (for next financial period if available).
Schedule of staff including owner.
- Job specification for owner.
- Copies of employment contracts.
5 Company Literature
- Feature articles.
Photographs of premises or products.
6. Plant & Machinery Valuation
A recent valuation by a registered plant valuer.
7. Business Premises
- Leasehold - details of lease or variations to lease.
- Freehold - details of valuation, recent LIM, certificates of title etc.
8 Industry Information
Details on industry reports, characteristics etc. which may be available in published form.
- The above sections are indicative only. The key questions to ask yourself are “if I was buying this business, what would my professional advisors need to know?”
- The information memorandum will not contain the names of customers, competitors etc. Information will be of a general nature only and commercially sensitive information will not be released. Client lists will only be made available after confirmation of the sale or as the last item to be addressed after all other matters are unconditional.
- Potential purchasers will not be introduced to staff members as the buyer until all clauses in the contract have become unconditional, other than the clause giving the purchaser say three days to hold discussions with staff.