What if there are no written contracts with key customers?

Plenty of real, durable customer relationships in small businesses were never written down — a handshake, a standing order, years of repeat business with no formal agreement behind any of it. That does not make the relationship fake, but it does make it harder for a buyer to verify or rely on with confidence.

Why the absence of paper matters

A written contract does two things an informal relationship cannot: it creates an enforceable obligation for the customer to keep buying on agreed terms, and it gives you something specific to review and assign as part of the sale. Without it, what you are actually buying is a pattern of past behaviour and a personal relationship the seller currently holds, neither of which is guaranteed to transfer to you.

How to test whether it is likely to hold anyway

• Look at how many years the relationship has continued without any formal agreement — a long, consistent history is meaningfully more reassuring than a recent one
• Ask directly why there is no contract, and whether the customer has ever been asked to sign one and declined
• Check whether the relationship is with the business’s brand and reputation or specifically with the current owner personally
• Ask the seller to introduce you to the customer directly before closing, and gauge the response yourself

What to do about it before and after closing

Where a customer represents a meaningful share of revenue, ask whether they would be open to a written agreement, even a simple one, as part of or shortly after the transition — a customer who values the relationship generally has no objection, and reluctance is itself informative. Where formalizing it is not realistic, price the risk explicitly rather than treating undocumented revenue as equivalent to contracted revenue.