Top Strategies to Make Informed Commercial Decisions When Buying and Selling a Business

Make Smarter Business Decisions with Expert Guidance

Buying or selling a business is one of the most important commercial decisions an entrepreneur can make — and it’s not a journey you should walk alone. Whether you’re looking to acquire a high-performing enterprise or sell your business for maximum return, informed decision-making is the difference between wealth creation and financial regret.

Strategy 1: Conduct Robust Commercial Due Diligence

Due diligence is non-negotiable.
Buyers should inspect:

• Financial statements & historical cash flow
• Legal obligations & contract liabilities
• Supplier and customer dependencies
• Operational bottlenecks

Sellers must prepare:

• Clean, auditable financials
• Demonstrated profitability and SDE/EBITDA
• Organised documentation (leases, IP, employment contracts)
• Growth forecasts backed by data

💡 Pro Tip: Use due diligence to uncover risks and hidden value that affect deal terms, timing, and valuation.

Strategy 2: Perform Comprehensive Financial Analysis

Buyers: Validate EBITDA, ROI, working capital needs, and risk-adjusted returns.
Sellers: Know your valuation metrics — Price to Earnings (P/E), Seller’s Discretionary Earnings (SDE), and recent comparable sales in your industry.

🧲 Did You Know?
Australian small business sale multiples range between 2.5x–4.5x SDE depending on sector, size, and risk profile (source: SeekBusiness & ATO benchmarks).

Strategy 3: Understand the Market and Industry Landscape

Every smart deal starts with market knowledge.

Buyers:

• Evaluate local demand, market trends, and threats
• Analyse barriers to entry and long-term viability
• Leverage ATO and ABS industry benchmarks

Sellers:

• Position your business in a growth market
• Highlight your unique competitive advantage
• Provide verified data on recurring revenue and customer retention

🔎 Market Data Snapshot:

• Demand for essential services (healthcare, trades, logistics) remains high
• Online and tech-enabled businesses continue to attract premium valuations

Strategy 4: Get Legal & Regulatory Compliance Right

Deal structures are as important as price. Ensure:

• Clean legal standing (no disputes, fines, or compliance gaps)
• Properly assigned contracts and licenses
• IP, leases, and staff contracts are transferable

✅ Tip: Work with legal advisors experienced in SME and mid-market M&A to protect your interests.

Strategy 5: Evaluate Your Financing Options

Buyers:

• Traditional bank loans (secured/unsecured)
• Private equity or silent partners
• Vendor finance (seller holds part of payment)
• Earn-outs or performance-based milestones

Sellers:

• Consider what’s more important — upfront payout vs long-term value
• Be flexible but protect your downside with proper deal terms

📈 With interest rates steadying in late 2025, business acquisition finance has become more accessible for qualified buyers.

Strategy 6: Have a Crystal-Clear Exit Strategy

Both parties need a defined outcome beyond the transaction:

Buyers:

• Build-to-exit plan (3–5 year hold)
• Expansion strategy (franchise, acquisition, diversification)

Sellers:

• Lifestyle planning
• Asset reinvestment
• Tax minimisation strategies

💼 Did you know?
Over 62% of Australian business owners aged 50+ plan to sell in the next 5 years — competition is growing.