What should a buyer check about a computer store’s online sales?
Check which site, marketplace and payment accounts the store uses, whose name each is in and whether they can move to you. Then check how online orders, shipping, returns and chargebacks are recorded apart from counter sales, and whether any marketplace standing or reviews transfer.
Many computer stores sell online as well as at the counter. The website may be a small shop page, or the store may list on one or more marketplaces. Either way, the online side depends on accounts that were opened by a person. Before you buy, you need to know which accounts exist, who controls them and whether they can be handed to you.
Accounts and who holds them
Ask for a list of every online account: the website host, the domain name, the email addresses, the payment processor and each marketplace. Find out whose name each is in, and who has the login. Some accounts can be transferred and some cannot, and the rules differ by platform. Ask for the platform’s own terms and show them to your lawyer.
Recording online sales apart from the counter
A clear set of books keeps online sales apart from counter sales, with orders, shipping costs and fees in view. Ask to see a few months of online orders matched to payouts. Ask your accountant how GST/HST and provincial tax on online orders is handled and recorded. A store that mixes the two streams is harder to read, and that is worth knowing early.
Returns, chargebacks and standing
Online buyers return goods and dispute charges. Ask for the store’s return terms and its record of returns and chargebacks, and see how each was resolved. Ask whether marketplace ratings, seller status and reviews stay with the account or leave with the owner. If they are tied to a person, they may not come with the sale.
Related reading
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Due diligence
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Canada Revenue AgencyGovernmentBuying a business
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