Glossary
Vendor due diligence
Due diligence commissioned by the seller, not the buyer, before a sale process begins. The report is shared with prospective buyers to give them confidence and shorten their own investigation.
In plain English
Vendor due diligence is more common in larger or competitive processes. It identifies issues early, while the seller can still address them, and presents the business to buyers on a consistent basis. A lighter version, often called vendor assist, prepares the information without a formal report.
For smaller agency transactions, a well-prepared normalised EBITDA bridge and an organised data room achieve much of the same benefit.
Why it matters
Finding issues yourself is better than having a buyer find them. Vendor due diligence turns surprises into explanations.
What to watch for
- Weigh the cost against the size and competitiveness of the process.
- Address issues the review identifies before going to market.
- Buyers will still conduct their own confirmatory diligence.
Transaction language and legal treatment depend on the agreement and the jurisdiction. Written by Motion Advisory Partners as general guidance, not legal advice.