Due Diligence List

Markets and Products

A. Describe major products within business segments and provide available literature.

B. Discuss degree of custom formulation of products.

C. Discuss installed product base (number of units by type installed in held).

D. Obtain and analyze market share data by product segment: current and trends in the last 3 years and year-to-date.

E. Obtain and analyze market size by product segment, wit11 historic and projected growth. What are the key market drivers?

F. Is the market fragmented? Are the end users segmented?

G. Obtain and analyze significant competitors by product segment: their size, market share, market share trend in the last 3 years, distribution system, and perceived competitive strategies.

H. Document the basis on which the company competes and comparison with the competition. Analyze key product differentiating factors and advantages/disadvantages versus the competition,

I. What are the barriers to entry within the industry? What additional threats will this industry face in the future?

J. Analyze the impact of the marketing and sales organization and their compensation arrangements.

K. Analyze pricing policy and sales terms.

L. Obtain sales breakdown by geographic market, trends in th3 last 3 years, year-to-date and projected growth.

M. Obtain major customer list (largest 20) and sales in the last 3 years and year-to-date. Does the company rely upon a few major customers? Gain an understanding of what customer decisions drive sales.

N. Are there any seasonal or cyclical aspects to the business?

Financial Analysis

A. Financial Statements