Step 3: Analyze the Business Once the buyer feels comfortable with the industry he must then turn his attention to the business itself (6). It is at this time that buyer can request to see the business’s tax returns. The potential buyer needs to ask qualitative and quantitative questions. For example: Why is the owner selling the business and how long has he/she owned the business? What does the owner plan on doing after they sell the business? Has the business been in bankruptcy or had any lawsuits filed against it? What outstanding leases does the company have? It is suggested that the potential buyer examine the company’s financial statements (if they do not have a sensitivity analysis, breakeven analysis, or financial ratios it is recommended that you develop these):
