CONTENT FOR AN INFORMATION MEMORANDUM

The following are suggestions for topics to be covered in a business profile.

Ensure all financial information included has been supplied by the vendor and all
information included is factual and not speculation

• Disclaimer

• Introduction
 Executive summary
 Background on ownership and operations.
 Financial information.
 Raw materials and supplies.
 Customers and competitors.
 Facilities and plant.
 Management, organisation and control.
 Reasons for sale.
 Other information.

• Executive Summary
 The business and why it is unique.
 Management Qualifications.
 Summary of past financial performance and future projections.
 The price of the business and any vendor assistance.

• Ownership and operations

 History of business, ownership changes, location. Mission statement.
 If prod or division, commentary on each (eg growth, research etc).
 Awards, patents, trademarks, technology, intellectual prop etc.

• Financial Information
 Summarised profit and loss and balance sheets. 3-5 years.
 Forecasts for next 2-3 years.
 Vendor comment to provide "feel" for company.

• Raw materials and supplies

 Background notes on suppliers, payment terms, delivery terms etc.

• Customers and Competitors

• Facilities and Plant

 MV, BV, and insurance value (independent if poss.).
 Terms of leases, renewal options etc.
 Rentals and rates as approx.
 Approx. sq. footage and repairs undertaken/needed.
 Excess capacity or availability for potential expansion/sub lease.
 Intangible assets.

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  Lease of building.

• Management Organisation and Control

 Information on key numbers of staff (brief) incl. age, qualifications, experience, tasks. Include
organisation chart if available (or draw one up). Contract details.
 Details and scope of any management information systems. A brief outline of the information
held, software used, number of computers/terminals etc.
 Total staff numbers, particulars of working hours, overtime, bonus and incentive schemes.
Staff T/O level. Union participation/agreements.

• Reasons for Sale/(or Capital)

 Brief description.
 Sale process.

• Other Information
 Could include brochures, newsletters, testimonials etc.

Important:
In preparing this profile it is important that the client (vendor) is fully involved with the project.
The document must reflect the owners' attitudes and feelings toward the business. The
owners must believe in the contents and be prepared to support them during negotiations.
Any sensitive information must have the client’s approval. (There is a likelihood, with all the
best intentions in the world, and despite confidentiality disclaimers, that the information
will/could become widely known). The vendor should insist on having control over the
disbursement of the business profile, and should insist on their return.

Make sure vendor has vouched for:

 Title to all assets
 Stock
 Accuracy of salary wages
 No contingent liabilities (or hidden)
 Tax warranties
 General warranties

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