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Due Diligence

What is the use of due diligence studies?

Due diligence provides full understanding of all the obligations of an enquired company and reveals what conditions the company is in and presumably will be in the near future. With due diligence study findings from impartial, reasonable and prudent third party, a creditor, potential investor or acquirer is able to make right decisions and reduce risk exposures in legal proceedings, investment or acquisition.

How we conduct due diligence?

  • On-site: We will send reporters and research people to the enquired company to gather and check information. The enquired company is informed who orders the due diligence and what for
  • In-house: We will gather and check information from various sources without letting the enquired company knows who orders the due diligence

When is due diligence necessary?

  • When a trader is concerned about what will happen upon hearing that some changes have occurred to a regular supplier/buyer
  • When a creditor wants to make sure the lawsuit is worthwhile before going to court
  • When a potential acquirer hopes to get what he thinks he is paying for
  • When a manufacturer looks for an ideal OEM who can meet as many his requirements as possible
  • When a company is interested in finding out more before entering into partnership with another company
 

Who needs due diligence studies?

  • Buyers
  • Creditors
  • Investors or acquirers
  • Business partners
  • Manufacturers looking for OEM

Who should use due diligence studies?

  • Shareholders
  • Decision makers of an organization
  • Head of business department
  • Head of financial department
  • Law consultants

How due diligence can help? --Avoid making wrong decisions

  • To better understand major suppliers and buyers and adjust terms accordingly
  • To locate sizable assets and to take action before lawsuits
  • To screen out the best to purchase or to invest in after a parallel comparison sorting
  • To decide on the best OEM
  • To reduce credit cost by the business information from your partners

Our due diligence report contains following information:

1. General information: registration data, organization structure, branches or subsidiaries, history and evolution
2. Employees: number of employees by work division and by posts, their overall quality, education and number of years in the company
3. Salaries: salary ranges by work division, bonus, extra hour work payment, other welfare, insurance, etc.
4. Production: number of plants, location, floor area and build year, number of production lines, applications, conditions and capacities, major raw materials and purchase volume, outputs and other pertinent information
5. Sales: sales outlets (internal and external), major customers, prices and sales volume of core products, payment and credit policy
6. Financials: financial statements including balance sheets and income statements, financial analysis of operation capability, solvency and profitability; list of fixed assets, other financial information
7. Comprehensive analysis: SWOT, market shares, prospect, sales growth, feasibility for joint venture/acquisition/OEM, etc.