Map the supply chain and legal role
Identify whether the business imports, manufactures, assembles, brands, distributes, wholesales, agents, services, installs, or only resells each material product line. Record the contracting entity, territory, channel, exclusivity, minimum purchase, rebate, warranty, technical support, termination, assignment, and change-of-control terms.
A distributor, importer, manufacturer, agent, and retailer can carry different product, contract, labelling, recall, tax, customs, safety, and customer responsibilities. Confirm the actual role for each product rather than applying one label to the whole company.
Test supplier rights and concentration
- signed supply, agency, distribution, exclusivity, rebate, and marketing agreements
- territory, customer, channel, product, and online-sales restrictions
- renewal, termination, assignment, ownership change, minimum orders, targets, and notice
- supplier concentration, alternative sources, lead times, allocation, price changes, and foreign currency
- historic supplier support, disputes, warranty recovery, credit limits, and relationship ownership
A long relationship or approved-distributor badge is not proof that rights continue after a sale. Verify documents and obtain supplier consent only under an adviser-approved confidentiality sequence.
Reconcile inventory and working capital
Stock can be both a core asset and a major source of seller-buyer disagreement. Build item-level evidence for ownership, location, quantity, landed cost, sales history, age, condition, shelf life, serial or batch traceability, customer allocation, supplier return rights, and obsolescence.
- separate consignment, customer-owned, demonstration, repair, warranty, and company-owned stock
- test slow-moving, superseded, damaged, expired, incomplete, and unsupported lines
- reconcile stock systems to counts, purchasing, sales, general ledger, and warehouse locations
- model seasonality, minimum orders, safety stock, freight, duty, foreign exchange, and supplier terms
Prepare customer, margin, and system evidence
Analyse revenue and gross margin by customer, product, supplier, branch, channel, salesperson, and service line. Distinguish contracts, standing orders, framework arrangements, repeat purchasing, projects, tenders, and pipeline. Test customer concentration, churn, price overrides, rebates, returns, credits, warranty, and owner-held relationships.
Document ERP, product data, pricing, purchasing, demand planning, warehouse, serial or batch traceability, e-commerce, CRM, cybersecurity, backups, integrations, and access controls. Show that the team can operate these systems without the owner.
Map product safety, labelling, chemicals, and recalls
ACCC Product Safety provides business guidance on safety laws, bans, mandatory standards, sourcing and testing, compliance programmes, recalls, and mandatory reports. Product-specific applicability must be checked. Business.gov.au also directs businesses to applicable labelling, measurement, product-safety, and origin requirements.
For hazardous products, map safety data, storage, segregation, placarding, transport, fire, environmental, training, emergency, waste, and jurisdictional requirements. Preserve complaint, incident, test, batch, customer-notification, corrective-action, and recall evidence.
Assess people, transition, and the complete proposal
Map supplier relationships, technical advice, quoting, pricing authority, key accounts, purchasing, inventory decisions, product compliance, warranty, and systems administration. Replace owner dependence with defined authority, documentation, and capable people.
Buyers may examine maintainable earnings, supplier and customer concentration, stock, working capital, product exposure, systems, people, and structure. There is no universal distribution multiple. Use the Australian buyer scorecard to compare funding, conditions, operating plans, employee implications, transition, and seller risk.