5. How to Prepare Clients for Due Diligence (Without Freaking Them Out)

business brokers manage the sales process methodically and professionally

reducing stress, building trust, and keeping deals on track

For many sellers, due diligence is the moment things start to feel real and a little scary.

After all, someone is now combing through: -

• Their financials

• Their systems

• Their contracts

• Their team

• Their tax history

• And more…

It’s invasive. It’s personal and if the seller isn’t emotionally and practically prepared, it can throw the whole deal off-course.

🚨 The Risks of Poor Due Diligence Prep

When sellers aren’t coached early, due diligence can lead to -

• Defensive behaviour
  “Why do they need that?” becomes a recurring question.

• Delays and frustration
  Missing documents, poor file organisation, and slow responses signal risk to the buyer.

• Erosion of trust
  Even small gaps or inconsistencies can start to feel like red flags.

• Emotional shutdown
  Some sellers go from “ready to sell” to “maybe I’ll hold off” - simply because the process overwhelms them.

🧭 Your Role as a Broker

Here’s what experienced brokers do differently -

• They set expectations early
  Frame due diligence as standard - not suspicious.

• They help prepare the person, not just the paperwork
  Confidence is built before documents are requested.

• They reframe due diligence as validation, not interrogation
  A good buyer is just doing their job - not looking for problems.

🛠 Tools & Talking Points for Brokers

Help your sellers feel in control with this simple language -

• “Buyers aren’t looking for perfection - they’re looking for predictability.”

• “They don’t expect zero issues. They just want to know what they’re walking into.”

• “Let’s get everything ready now, so you don’t feel rushed later.”

• “Due diligence is a milestone - not a red flag.”

📋 What Sellers Should Prepare (and Why)

Here’s a basic checklist to walk them through -

• ✔️ 3 years of clean financials (P&L, balance sheet, cash flow)

• ✔️ Detailed list of add-backs, with documentation

• ✔️ Staff contracts and position descriptions

• ✔️ Customer and supplier agreements (if any)

• ✔️ Lease terms and renewal options

• ✔️ Updated org chart or responsibilities matrix

• ✔️ Key systems and process overviews

• ✔️ Any ongoing litigation, disputes, or liabilities

Even if some of these don’t apply, just showing preparedness helps the buyer feel confident.

🧠 A Quick Story

One broker I worked with had a great business lined up - strong numbers, reliable staff, great brand.

But when due diligence started, the seller became agitated.

“Why do they need to see that?”
“We’ve never had a problem before.”
“Feels like they don’t trust me.”

The buyer started pulling back.
A week later, they withdrew their offer - citing “cultural mismatch.”

The truth? They didn’t trust how the seller reacted to pressure.

🤝 Final Thought

Due diligence is a test of systems, but also of people.

When brokers lead with empathy and clarity, sellers stay calm, prepared and confident.
That’s how trust is built and deals stay on track.

If you’ve got a client in the thick of due diligence now, or about to begin and things feel shaky, I’d be happy to jump on a call and help you stabilise it.

👉 Book a free 15-min strategy call https://www.regenerationhq.co.nz/contact
👉 Or reply to john.luxton@regenerationhq.co.nz and I’ll send through a checklist you can use right away.