Business
What Nobody Tells You About Buying a Small Business
A few months ago I sat with a client who was about to buy a business that would have cost him far more than the purchase price — and he didn't know it yet. He just knew the other side was pushing hard, and he was tired of being pressured.
That's the part nobody tells you about buying a small business in Adelaide, or anywhere: the paperwork isn't the hard part. The people are.
The deal that almost went wrong
I can't share names, so I won't — but I can share what happened, because it's a pattern I see more often than people realise.
My client was buying. The seller's side was aggressive from the start — not just firm, but dismissive. The kind of dismissive that only shows up when someone thinks you don't know what you're looking at.
They pushed hard for a fast settlement, built around a statutory declaration. On the surface it looked like paperwork. In reality, it had a witness date that was simply wrong — a technical error that would have made the document invalid if it was ever tested. There was no GST or going-concern clause, which could have left my client up for a significant, unexpected GST bill on top of the price he'd already agreed to pay. And there was no condition precedent covering lease assignment — which meant he could have completed the purchase and then discovered the landlord wouldn't transfer the lease, leaving him with a business and nowhere to run it from.
What actually protected him
The advice that mattered most wasn't complicated. It was this: don't hand over the deposit until a proper, binding agreement is signed.
That single piece of advice bought enough time to get the real issues fixed — the dating error corrected, the missing clauses added, the lease properly assigned — before any money changed hands that couldn't be recovered.
Engaging a business advisor for this cost my client money upfront. I won't pretend otherwise. But it saved him from something much more expensive: buying a business on someone else's terms, with no real protection if it went wrong later. That's not a cost. That's insurance that paid for itself in the first conversation.
The three things almost every private sale gets wrong
If you're buying a small business — whether it's a shopfront, a trade business, or a service business — these are the things I see missed most often, in roughly this order of how much damage they cause:
- Deposits handed over before the contract is binding. A stat dec, a handshake, or an "agreement in principle" is not a contract. Until there's a properly executed, binding agreement, your deposit should stay in your control.
- No GST or going-concern clause. Get this wrong and you, as the buyer, could be up for GST on top of the price you already agreed to pay — a mistake that can cost tens of thousands of dollars after the fact.
- Lease assignment left as an assumption, not a condition. If the business depends on its premises, the lease transfer needs to be a condition of the sale — not something everyone just assumes will sort itself out. In South Australia, retail and commercial leases carry their own assignment requirements, and assuming a landlord will simply agree is one of the most common — and expensive — mistakes buyers make.
There are more — financial due diligence, verifying what you're actually buying, accurate valuation — but these three are where I've seen the most damage done, and the most avoidable.
Why the pressure is the biggest red flag
Every deal has some urgency to it. That's normal. What's not normal — and what should make you slow down, not speed up — is when the other side's urgency starts to look like pressure. Fast timelines paired with incomplete paperwork are a combination worth pausing on, every time.
The buyers who get taken advantage of in private sales are rarely the ones who ask too many questions. They're the ones who don't feel like they're allowed to.
If you want someone in your corner before you sign anything, that's exactly what Business Value Review and Private Sale Support are for — an independent set of eyes on the deal, the paperwork, and the pressure, before any of it becomes your problem.
If you're on the other side of the table
Everything above applies just as much if you're selling. The earlier either side gets an independent set of eyes on a potential deal, the more options they have — and the less likely they are to be the one under pressure.
If you're preparing to sell, that's where a Business Value Review comes in — giving you a clear, honest picture of what you're working with before anyone else's timeline becomes your problem.
FAQ
Do I need a solicitor if I already have a business advisor?
Yes — a business advisor and a solicitor do different jobs. An advisor helps you understand the deal, the numbers, and the risks; a solicitor drafts and executes the binding legal documents. The strongest deals use both.
Is it normal for the other side to push for a fast settlement?
Some urgency is normal. Urgency paired with missing clauses, verbal-only agreements, or pressure to hand over a deposit before anything is signed is not — that combination is worth stopping and getting independent advice on.
What's the difference between Private Sale Support and a Business Value Review?
Private Sale Support is built for buyers — an independent review of the deal, the numbers, and the paperwork before you commit. A Business Value Review is for sellers — an honest read on what your business is worth and how ready it is for market.
I've already started negotiating — is it too late to get advice?
No. The earlier the better, but even mid-negotiation, an independent review can catch issues before they become expensive.
Already got a deal in front of you — buying or selling?