What to Ask When Buying a Business

Two Lists, and When Each One Runs

Buyers search for one magic question list, and there are actually two, run months apart. The first is a conversation: the questions you ask a seller before any offer, to understand what the business is and whether you want it. The second is a verification: the diligence request list that runs after a signed letter of intent, when you have the standing to ask for tax returns and bank statements. Mixing them up is the classic first-timer tell: demanding documents on a first call reads as distrust from a stranger, and saving basic questions for diligence wastes the exclusivity window on things a conversation would have surfaced free. This page is the first list; the checklist owns the second.

The Opening: Understand Before You Value

The first conversation has one job, and it is not price. Ask why they are selling, and listen past the first answer, because retirement sometimes means burnout and sometimes means a landlord fight the listing does not mention. Ask what a normal week looks like for them personally: the answer is the job you are buying, and it either matches your life or it does not. Ask who does what: how many people, how long they have been there, and what only the owner knows how to do. Ask where customers come from and how the phone rings. None of these are financial questions, and together they tell you more about transferability than the P&L will, because what you are really asking is whether this business runs on a system or on the person leaving it. For a cold call to an owner who has never listed, use the prepared first-call list, which pairs each question with what to listen for and drops its notes straight into the tracker’s fields.

The Money Questions, Asked Like an Operator

Once a conversation is real, the money questions follow, and the phrasing matters: you are not auditing yet, you are understanding. What does revenue look like across a year, and which months carry it? Who are the biggest customers, and roughly what share of the whole is the largest one? That is the concentration question, and it kills more small deals than price does. What does the owner pay themselves, and what personal expenses run through the business? That is the add-backs conversation arriving politely, and the honest version of it decides what the earnings actually are. Ask what they would fix first with a new owner’s energy, because sellers answer that one truthfully and it is tomorrow’s to-do list.

What Not to Ask Yet

Some questions cost trust when asked too early, and trust is the currency the whole conversation runs on. Do not negotiate price in the first call: you have no verified numbers to anchor on, and the offer has its own sequence. Do not ask for customer names, employee details, or anything competitively sensitive before an NDA and usually not before an LOI; a seller protecting those is behaving correctly, and a buyer pushing for them early reads as a competitor fishing. Do not ask the seller to justify the asking price line by line, because that argument belongs after diligence, with verified earnings on the table. The discipline is simple: every stage of a deal earns the next round of questions, and asking out of order costs more information than it gains.

From Conversation to Checklist

When the conversations have convinced you and an offer is signed, the question list changes character: the diligence checklist takes over with the document requests, the deal workspace keeps the answers organized, and the add-backs conversation from your second call becomes a schedule to verify line by line. Keep notes from every seller conversation in the tracker as you go, because the answers age well: what a seller said in March is worth rereading against what the documents show in July, and the gaps between the two are diligence questions nobody has to invent.

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