You’ve found a business that looks perfect—steady revenue, loyal customers, and a motivated seller. But before you shake hands or sign anything, you need to slow down.

The right questions to ask when purchasing a business can uncover risks that glossy sales pitches won’t. Miss one, and you could inherit debt, lawsuits, or a broken operation.

55 of the Best Questions to Ask Before You Buy a Business

When you’re buying a business, what you don’t ask can cost you. These questions are designed to help you spot red flags, assess value, and move forward with clarity.

Business Readiness Questions

Start with business readiness — if this foundation isn’t solid, nothing else will be either.

1. Why buy the business?

You need more than a gut feeling. What’s the strategic value? Are you buying market share, eliminating a competitor, or expanding capabilities?

2. Why not build internally?

Ask yourself whether acquisition is the faster, smarter path — or if your team could create the same results in-house with less risk.

3. Is the acquisition affordable?

Even if the price seems fair, can your business absorb the cost and maintain operations? Be honest about budget, debt, and future cash flow.

4. Does your team have the bandwidth for a deal?

Acquisitions demand attention. If your leadership, legal, or finance team is stretched thin, things will fall through the cracks.

5. Who are your third-party experts?

You’ll need legal, financial, and tax advisors who know what to look for. If you’re scrambling to find them mid-process, you’re already behind.

6. Is there a strong culture fit?

Clashing cultures can derail even the most strategic acquisition. Are the values, leadership styles, and workflows aligned?

7. Is this the best target company available right now?

Before you get attached, ask if there’s a better option. Have you looked at comparable businesses? Talked to brokers? Explored off-market opportunities?

Questions about the Business's History

Before you buy the future, you need to understand the past—ownership, legal baggage, and why the seller is walking away . All of these matter.

8. Why sell the business?

Get the real reason. If it’s underperforming or the owner is avoiding looming problems, you need to know now.

9. When did the business start?

Longevity can show stability, but it can also hide outdated systems or stagnation.

10. Are there any other investors or owners?

Understand who has a stake. Shared ownership means shared influence, and that can complicate negotiations or decision-making.

11. Was there ever a lawsuit against the business or the owner?

Past legal issues can resurface. Get full details so you don’t inherit hidden liabilities.

Future Business Growth Capabilities

You’re not just buying what the business is today—you’re investing in what it could become. These questions help you assess its real growth potential.

12. Does the business have the potential for hypergrowth?

Look for scalable systems, strong market demand, and a clear path to expansion.

13. Is the business too dependent on the current owner?

If operations fall apart without them, you’re not buying a business—you’re buying a person’s job.

14. Is there someone who could run the business?

Whether it’s someone on your team or theirs, identify leadership early to avoid operational gaps post-sale.

Financial Valuation

Numbers tell the truth. These questions help you cut through surface-level claims and see whether the business is actually worth what the seller says it is.

15. What is the business revenue?

Annual revenue sets the tone—just make sure you’re looking at verified, up-to-date numbers.

16. How much profit does the business make a year?

Profit shows how well the business turns sales into income. High revenue means nothing if the margins are razor-thin.

17. Does the seller have any outstanding debt?

You don’t want to take on hidden liabilities. Ask for details on loans, liens, and lines of credit.

18. What are the company's assets?

From equipment and real estate to IP and inventory, you need to know what you're actually getting in the deal.

19. How much is in the business's bank account?

Current cash flow can reveal financial health and short-term stability, or a warning sign.

20. Is the business tax compliant?

Unpaid taxes or sloppy filings can lead to fines or audits. Verify returns and consult your tax advisor.

21. What does the business's quality of earnings look like?

Go beyond net income. Look at how earnings are generated and whether they’re recurring, stable, and supported by strong documentation.

22. What is the projected sales for the next year?

Seller projections are helpful, but should be backed by data, not guesswork. Ask how they arrived at the numbers.

23. What is the seller's asking price?

Get the number and ask how they came up with it. Does it align with industry standards and recent comps?

24. How much have similar businesses recently sold for?

Market comparisons are critical. Look at location, size, and industry to determine if the deal is priced fairly.

Questions About Day-to-Day Operations

Understanding the business means getting into the weeds. These questions uncover how the business actually runs, who it depends on, and where the risks are hiding.

26. How many employees does the business have?

Staff size affects payroll, management needs, and culture. Know what kind of team you're inheriting.

27. Have there been any layoffs or material changes to the workforce in the last 24 months?

Recent changes can point to instability or efforts to cut costs before a sale.

28. What are the products or services of the business?

Understand exactly what the business sells, how it's packaged, and what makes it profitable.

29. Does the business have intellectual property, trademarks, or patents on its products?

These can add significant value—or lead to legal issues if not properly protected or transferred.

30. How does the business produce products?

In-house manufacturing or outsourcing? What are the costs, timelines, and risks involved in production?

31. Are the facilities, equipment, fixtures, and vehicles in good working condition?

Physical assets can make or break operations. Ask for inspection reports or maintenance records.

32. Who are the suppliers?

Long-standing vendor relationships matter. Are they reliable, exclusive, or replaceable?

33. How does the business sell?

Direct-to-consumer, B2B, online, retail? Know what channels drive sales.

34. Who are the customers?

Customer concentration can be risky. A business that relies on one or two accounts isn’t stable.

35. How does the business acquire new customers?

Organic traffic, referrals, and advertising? Ask for metrics and costs behind the customer pipeline.

36. Has there been customer churn in the last two years?

Losing customers is a warning sign. Get the numbers and the story behind them.

37. Who are the competitors of the business?

You’re not just buying a business—you’re stepping into a market. Know who else is out there and how your target compares.

38. Does the business have any existing partnerships with other entities?

Joint ventures, marketing alliances, or revenue share deals can affect control and profitability.

39. Any other contracts or agreements the business has entered into?

Don’t inherit obligations you don’t understand. Review all active agreements carefully.

40. Does the business have the proper licenses and permits to operate?

Missing permits can shut you down. Verify everything is current and transferable.

41. What kind of technology does the business use?

Legacy systems may require upgrades. Look at software, hardware, and integrations.

42. Will the business be the same under different ownership?

Ask how much of the business’s success depends on the seller’s personal relationships, leadership style, or network.

43. Is the target company better left alone? Or integrated?

Some businesses run best as standalones. Others perform better when absorbed into your existing structure. Know which one you’re dealing with.

44. Does the seller have better processes?

Learn from them. If the seller’s systems are more efficient, consider adopting rather than replacing.

45. Is the seller happy about the integration plans?

If they’re uneasy, dig deeper. Their reaction could reveal hidden risks or tensions with your vision.

Purchase Contract Questions

The purchase agreement is where everything becomes real. These questions help you define the deal, reduce your risk, and protect your investment after the ink dries.

46. How many risks are involved?

Identify legal, financial, and operational risks upfront. The more you know, the better you can negotiate.

47. What are the things included in the transaction?

List everything—assets, IP, contracts, equipment, inventory. If it’s not written down, it’s not guaranteed.

48. Is the seller willing to help during the transition?

A smooth handoff can be the difference between growth and chaos. Clarify how involved the seller will be post-sale.

49. Is the seller willing to sign covenants to protect the business?

Non-compete and non-solicitation agreements are key. Make sure the seller won’t become your next competitor.

50. What are the things that the seller is willing to represent and warranty?

You need assurances about what you’re buying. Review their promises on financials, legal standing, and operations carefully.

51. What are the other items needed to close the transaction?

From legal filings to board approvals, don’t let the closing stall because of missed paperwork or overlooked steps.

Miscellaneous

Sometimes, it comes down to gut checks and group consensus. These final questions help you take the full picture into account.

52. Was the seller nice during negotiations?

If negotiations were tense or shady, that’s a sign of what might come up after the sale.

54. How will the deal be announced?

Internally and externally, the message matters. Have a clear plan for telling staff, customers, and stakeholders.

55. Is everyone on the deal team happy about the transaction?

If key players have doubts, take the time to understand why. Misalignment now can turn into regret later.

56. Bonus Question: Are you happy with the company?

This one’s simple but big. After all the numbers, contracts, and negotiations, does this still feel right to you? Trust your gut.

4 Mistakes to Avoid When Buying a Business

Even the most promising deals can fall apart if you miss key execution details. These common missteps can cost you time, money, and long-term value.

Failing to plan for integration from day one.

If you don’t have a clear plan for what happens after closing, you’re setting the deal up for confusion, delays, or even failure.

Letting departments work in silos during the process.

Finance, legal, HR, and operations all need to be in sync. If they’re not communicating, you’ll miss critical risks and overlap.

Lack of buy-in from leadership slows everything down.

If your leadership team isn’t fully on board, execution gets sloppy and priorities get lost. Alignment is essential from the start.

Understaffing your deal team leads to avoidable mistakes.

A thin team means missed details, rushed decisions, and burnout. Make sure you have enough people, especially experienced ones, to manage the process.

Purchasing a Business: Frequently Asked Questions

What are the most important questions to ask when purchasing a business?

The most important questions to ask include why the business is for sale, what its financials look like, who the key customers and suppliers are, and whether the business has any outstanding legal or tax issues. These reveal the company’s true health and help avoid costly surprises.

How do you evaluate a business before buying it?

To evaluate a business, review its financial statements, assets, liabilities, customer base, employee structure, and legal standing. Compare similar business sales and assess the operational risks and growth potential.

Why is risk mitigation important when buying a business?

Risk mitigation is important because it helps you verify claims, uncover hidden liabilities, and make informed decisions. It protects you from overpaying or buying into legal or financial problems.

What legal documents should I review before purchasing a business?

Key legal documents include the purchase agreement, existing contracts, licenses, leases, tax returns, lease agreements, and employee agreements. Reviewing these helps you understand obligations and prevent post-sale disputes.

Work with a Business Attorney to Purchase a Business

Buying a business is a big move—don’t do it without legal backup. At The Retail Law Group, we help you ask the right questions, spot hidden risks, and close with confidence. Let’s make your deal a smart one together.

55 Savvy Questions to Ask When Purchasing a Business