Published : 1 July 2016

Having made the decision to make an offer on one of our business listings, you will generally follow the process outlined below. Your broker will keep you informed of immediate next steps and key dates related to the buying process.

• Communicate offer verbally or in writing to the broker you are dealing with for the business listing.
• The business broker will document your offer on a “Heads of Agreement”, detailing the specifics of the proposed offer and sale conditions to the vendor. The “Heads of Agreement” is an informal offer made in the absence of a formal Contract of Sale and is an offer in principal which forms the basis for the preparation of the formal Contract of Sale.
• On presentation of the offer to the Vendor to purchase a business, the buyer is required to pay an initial deposit (minimum of $1,000 or 1% of the purchase price, whichever is greater) to put the business "under offer". The deposit is held in trust and is 100% refundable should the sale not progress for any reason.
• Once the Heads of Agreement is signed by both parties, the deal progresses to due diligence. This is the period in which the buyer is given time to scrutinise the operations and financials of the business in more detail. The aim of due diligence is to ensure that no material misrepresentation(s) have been made during of the sale and marketing process. The business broker will be on hand to facilitate this phase, and will provide you with all the necessary due diligence documents and keep things moving in the right direction.
• During the due diligence period, the broker will start drafting the prescribed Contract of Sale, a legally binding document, the Contract of Sale is sent to both parties and their legal representatives for review.
• Once the Contract of Sale is agreed to by both parties, the Contract of Sale will be sent to the Purchaser and Vendor for signing. 
• On signing of the contracts, the balance of the deposit is required which is usually 10% or $10,000, whichever is the greater.
• After signing of the contracts, the Purchaser applies for the transfer of the lease of the premises, and any other relevant permits and licences, checks the assets to ensure that everything has been included. 
• The balance of the final sale price is payable by the Purchaser to the Vendor at settlement.