Due diligence

How to do due diligence on a Thai bar purchase: verifying the lease and licences, the real financials, the company's liabilities, physical stock and debts, and using professionals.

The step amateurs skip and regret

Thailand bar sales run heavily on trust, charm and “the books” scribbled on a napkin. Professional due diligence — boring, unromantic, and the difference between an investment and a donation — is where you find what the seller isn't saying.

The checklist

• Legal: verify the lease (term, registration, transferability — leases), all licences, and, if buying a company, its corporate records, director/shareholder structure and any encumbrances;
• Financial: demand real records, not claims. Cash businesses are easy to inflate — cross-check stated revenue against stock purchases, staff numbers, utility bills and observed footfall. Sit in the bar over multiple sessions and count;
• Liabilities: if buying the company, you inherit its debts, tax arrears, unpaid staff obligations and any disputes — a share sale without a liability audit is Russian roulette;
• Physical: inventory the equipment and confirm it's owned and included (not rented, leased or unpaid); check the stock; inspect the premises condition and any pending repairs;
• Relationships: the landlord, the neighbours, the local authorities, key staff — talk to them independently of the seller.

Use professionals

• A licensed Thai lawyer for the legal and structure review — non-negotiable (why);
• An accountant to test the financials and the company's tax position;
• Independent translation of every document you sign — never rely on the seller's summary;
• The cost of proper due diligence is trivial against the cost of skipping it. Every cautionary tale on the pitfalls page started with someone who didn't bother.