When preparing to sell a business, most owners know they need a business broker to find a buyer and an accountant to help with financial and tax matters. However, many don’t involve their lawyer until a Sale & Purchase Agreement is already on the table.
In reality, that’s often too late.
A successful business sale is a team effort. Your broker manages the sale process, your accountant helps structure the transaction, and your lawyer identifies legal risks before they become costly problems.
Many SME owners delay engaging a lawyer to save money or because they don’t fully appreciate the value of early legal advice. Ironically, the issues that end up costing the most are often the ones that could have been avoided with a relatively small amount of upfront guidance.
Common issues include leases, asset transfers, employee matters, restraints of trade, warranties, GST treatment, and Sale & Purchase Agreement negotiations.
One of the biggest mistakes we see is sellers waiting until they receive a draft agreement before seeking legal advice.
By that stage, the buyer has often prepared the agreement based on discussions, due diligence, and information already provided. Sellers may have made commitments about assets, contracts, employees, future support, warranties, or other matters without fully understanding the legal implications.
We’ve seen transactions where sellers later discovered they had agreed to obligations they were uncomfortable with once legal advice was obtained. Unfortunately, by then those expectations are often built into the deal.
Trying to unwind those commitments can lead to difficult negotiations, delays, damaged trust, and sometimes pressure on the purchase price.
Engaging a lawyer early helps identify potential issues before commitments are made. It’s almost always easier and less expensive to structure a transaction correctly from the start than to renegotiate terms later.
We’re also seeing more business owners relying on AI-generated contracts and document reviews to reduce professional costs. While AI can be a useful tool, it is not a substitute for qualified legal advice. Every business sale is different, and generic documents may overlook transaction-specific risks.
For many owners, selling a business is one of the most significant financial transactions they’ll ever make. The cost of obtaining legal advice early is usually minor compared with the potential cost of getting it wrong.
The smoothest transactions are typically those where the broker, accountant, and lawyer work together from the beginning. This approach reduces risk, uncovers issues earlier, and helps keep the sale process moving.
If you’re considering selling your business in the next 12–24 months, don’t wait until an agreement is in front of you before speaking with your lawyer.
Early legal advice can help avoid costly surprises, protect your interests, and improve the likelihood of a successful sale.
Thinking about selling your business? Talk to NZ Business Brokers. We can help you assemble the right advisory team and ensure you’re well prepared before going to market.
The earlier you prepare, the smoother and safer the sale process will be.
