“Buyer Beware” of Business Purchase Contracts

Paperwork, specifically legal documents, is a prerequisite to buying any business. It doesn’t make any difference if you buy a business once in your life or do it all the time, every business acquisition purchase contract is different and requires intense scrutiny on the part of the business buyer, much more so than the business seller.

As a business buyer, each and every sentence within the business purchase contract needs to be read, understood and agreed to before you sign on the “dotted line”. This article will give the business buyer a quick “fly-over ”of the most significant concepts one should understand relative to development and eventual execution of any business purchase contract.

“He Who Writes, Wins!”

If you have been consistently exposed to business contracts in your career, you quickly learn to appreciate the concept that, in development of most complex business agreements, “He who writes, wins!” Any attorney will tell you that it is always in his, his client’s, best interest to be the author of the business contract to be signed in a two party agreement. As a business buyer, you want to be the writer of the purchase contact. If you personally cannot effectively write one, invest the money and have a competent contract lawyer write a purchase contract on your behalf. If the business seller, or their legal counsel writes the business purchase contract be sure you and your attorney evaluate every detail within.

Always Maintain a “Paper Trail”

Given the extraordinary amount of capital involved in most business mergers or acquisitions, coupled with the wide range of people, conversations, meetings and iterative business evaluation

Why We Buy…..To Avoid PAIN!

Our innate drive to maintain our “comfort zone” directly affects how and what we purchase. Pain versus pleasure, similarity versus unfamiliarity and comfort versus stress; self