Selling a business is exciting, but here’s the thing: overlooking small details can lead to big problems later.
If you ever plan to buy a business – print, save and clip this post for when the time comes.
I’ve seen sellers end up in legal hot water—not because they were dishonest, but because they didn’t know what they needed to disclose. Most of these are innocent mistakes, but they can cost you if they’re not handled upfront.
My Checklist to Avoid Future Litigation
- Employee background checks
Have any employees been flagged for issues you’re not aware of? Make sure you’ve reviewed and disclosed relevant history to the buyer. - UCC filings
Outstanding liens or financing agreements? Check Uniform Commercial Code (UCC) filings to ensure there are no surprises for the buyer—or for you. - Customer and vendor contracts
Are contracts transferable? Do they have terms that could create problems for the buyer? Review everything carefully. - Marketing management
Who owns your marketing assets—your website, social media accounts, or ads? Clarify ownership and avoid disputes post-sale. - Insurance coverage
Are your policies current and adequate? Buyers will want to know if there are any risks left uncovered. - Environmental issues
If your business involves property or manufacturing, have an environmental assessment done to avoid liability for contamination or hazards. - Supplier rebates
Have you disclosed all special agreements with suppliers, like volume rebates or discounts? These can impact the buyer’s expectations and financial planning.
Why This Matters
These aren’t just legal boxes to check—they’re about transparency and trust. Buyers want to feel confident that they’re not inheriting hidden risks. As the seller, it’s your job to make sure they have all the facts upfront.
Before listing your business, work with a trusted advisor (like a broker or attorney) to review potential disclosure issues. The goal isn’t just to sell—it’s to sell cleanly without future headaches.
Have questions about selling your business? Let’s talk! Or share your own experiences in the comments—I’d love to hear how you’ve navigated these challenges.