With real estate, it is survivable if you overpay, because property values tend to increase over the long term. A business does not increase in value just because time passes.

"Most small business deals do not die in the contract negotiation stage, but in the due diligence stage when the buyer discovers that the seller is lying, or more politely stated, mistaken," says Brad Palmer a CPA and business broker in New Jersey.

Some people will do anything to make a business look better than it really is. They will place their own cash into the business’ account to create inflated revenue; they will fail to disclose a significant increase in competition; they will understate liabilities to vendors and tax authorities; they will fail to disclose impending eminent domain issues. The list is endless.

Unfortunately, for many prospective business buyers, their due diligence focuses on the financial aspects of the business such as determining if the assets and liabilities are correctly stated, and whether or not the profit or loss is accurate. This is very important, but it is not all there is to due diligence. If you are not an accountant, you should hire one to perform due diligence.

As regards the other aspects of the due diligence process, below is a check list of items that you can and should perform yourself:

- Do a thorough evaluation of the competitive environment. Visit competitive businesses if possible.
- Check with local political authorities to determine if there are any eminent domain issues.
- Try to speak to some existing customers, WITHOUT divulging confidentiality, to determine if they are satisfied with the products and/or services offered by the business.
- Meet with the landlord to determine if s/he is the type of individual that you want to enter into a long term lease agreement with.
- Do an evaluation of the long term prospects for the business’ products and services.

Remember, caveat emptor – buyer beware. You can'tafford to make a mistake when buying a business.