Commercial Due Diligence: Key Questions

The commercial due diligence process has some difficult questions to answer. These include:

Demand

  • Is the demand in the market future-proof?
  • Is the company operating in the right market segments?
  • Will the introduction of a new technology affect demand? (If so, how?)

Customers

  • How strong are the company's relationships with key customers?
  • Will their buying behaviour change in the next five years?
  • Can a larger group of customers be reached with the existing distribution channels?

Products

  • How do the products rate in comparison with the competition?
  • How does the product lifecycle vary?

Business plan

  • Will the company be able to accomplish its forecasts?
  • How robust are the assumptions that underlie these forecasts?
  • To what extent does the business plan take account of changes? What changes would substantially affect the business plan?

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