• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar

Marketinia

Marketing Solutions for Moving Forward

  • Home
  • Topics
    • Family
    • Health
    • Fitness
    • Swimming Pool
    • Shopping
    • Furniture
    • Financial
    • Business
    • Transportation
    • Lumber
    • Construction
  • Ask a Question
  • Contact Us

What Due Diligence Really Means

Last updated on October 23, 2012 by Sozo Staff Leave a Comment

Chances are you’re responsible for it, but you’re not quite sure what it is. Whether you’re on the buying or the selling side of a transportation business sale, the concept of “due diligence” can be intimidating or even downright frightening. If you’re a seller, you’re the one “under the gun” in an audit, but if you’re the buyer, it’s still your job to determine whether buying the transportation business will be wise. If both sides properly perform due diligence, the interests of both will be protected.

Understanding the Due Diligence Process

The basic idea behind due diligence is that a buyer performs in-depth research and evaluation of a transportation company that is for sale over a period of time (typically several weeks). As the process unfolds, it typically includes reviewing documentation such as legal history, operations, structure, financials, and policies and procedures. As follow-up to the evaluations of these documents, interviews with hired professionals such as accountants and attorneys may be used as well. During this intense process, the goal is to determine whether these two qualifications are met:

1. The transportation business for sale has been accurately portrayed by the seller
2. The transportation business for sale will be a good fit for the buyer.

Keeping those goals in view, the idea of due diligence is to prevent both parties from wasting their time working on a deal that simply won’t go through.

Maintaining Confidentiality During Due Diligence

During this pivotal process, the buyer becomes privy to sensitive information such as customer contracts, employee records, and supplier lists. Especially if the potential buyer decides to interview some of these major players, caution must be taken in order to avoid communicating the prospective buy-out.

When people catch wind of major changes, uncertainty is a natural result. With that uncertainty, business can be disrupted or even weakened, which can be detrimental to both the current owner and the future owner of the transportation business. In order to protect assets, business owners often require that a letter of intent (LOI) has been drafted before they will allow such due diligence to take place.

Pin-Pointing Risks During Due Diligence

If you’re a prospective buyer performing due diligence, you may not be sure exactly what to look for. Red flags to consider include the following:
• Multiple short-term owners
• Legal disputes
• Pending litigation
• Negative relationships with suppliers
• Other unresolved issues

In addition to finding out about the transportation business’s history and current status and relationships, you’ll want to evaluate the seller’s stated reason for selling. There may be hidden reasons for the sale that would make buying the business a poor investment on your part.

While all investments carry risk, performing careful and thorough due diligence can help prevent surprises from popping up later on. Transportation business experts at The Tenney Group (website) can help guide you through the process and promote a positive transaction experience for all involved.

Photo credits: Top © endostock / Fotolia. Middle © Jimmy Lopes / Fotolia. Bottom © endostock / Fotolia.

Filed Under: Business

Additional Articles

flexibility by young gymnastic girl
Nuts & Bolts of Priority Enrollment for Your Gymnastics Center
eager ambitious young ballet students
How to Recognize and Reduce Bullying in Your Dance Studio, Part 3
beautiful young ballerina girls resting against barre
How to Recognize and Reduce Bullying in Your Dance Studio, Part 2
beautiful young ballerina girl resting arms head on barre
How to Recognize and Reduce Bullying in Your Dance Studio, Part 1
Communicating with Parents: When Illness Hits Your Child Care Center
What Goals Can Jackrabbit Help Your Swim School Achieve?

Reader Interactions

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

2 × 2 =



Primary Sidebar

Jackrabbit Class Software
Lyon Financial

Popular Articles

  • How to Keep Track of Your Flash Drive
  • Stretching: Can There Be Too Much of a Good Thing?
  • Benefits of Ambidexterity
  • Should I Use Genuine Mahogany or African Mahogany?
  • Marine Grade Plywood Uses and Facts
  • How Much Is Your Trucking Business Worth?
  • What’s All the Excitement over X10 Home Automation?
  • Product Review of NuCedar Materials
  • Heated Driveway Installation by D'Amico Electric of Westchester, NY
  • The Truth About Recovering from Shoulder Labral Repair Surgery
  • Encourage Healthy Choices by Adding a Pool to Your Backyard
Tropical decking lumber
X10 Home Automation

Recent Posts

  • What You Need To Know About Pool Leaks, Part 2
  • What You Need To Know About Pool Leaks, Part 1
  • Safety & Convenience with X10’s SecuriLink Home Security & Automation Bundle Kit, Part 3
  • Safety & Convenience with X10’s SecuriLink Home Security & Automation Bundle Kit, Part 2
  • Safety & Convenience with X10’s SecuriLink Home Security & Automation Bundle Kit, Part 1
  • Nuts & Bolts of Priority Enrollment for Your Gymnastics Center
  • What You Can Do To Reduce Exposure to RWIs
  • Simplify Your Life With X10 Wireless Controllers
  • Get Answers to Your Questions About Fireplace Glass Doors and Screens
  • Planning for Swimming Pool Repairs, Part 3

Reader Feedback

  • Levi Armstrong on Helpful Tips for Finding a Reliable Pool Builder – Part 5
  • Nelson Fogerty on The Importance of Pool Fences
  • Concrete Pavers NZ on Pros & Cons of Fiberglass Swimming Pool Liners
  • Jonathan Hansen on The Importance of Pool Fences
  • Swimming Pool And Spa Auckland on Pros & Cons of Fiberglass Swimming Pool Liners
  • Carl Green on Figuring Out What’s Right for You: 3 Swimming Pool Construction Types

Copyright © 2021 Sozo Firm Inc · Privacy Policy · Disclaimer · Sitemap