Checklist for due diligence: The Ultimate Guide to Smooth Acquisitions

In today’s complex business environment, a superficial glance at financial statements is a recipe for disaster. A thorough due diligence process now extends deep into cybersecurity, intellectual property, and regulatory compliance, areas where hidden liabilities can unravel a promising deal. This comprehensive checklist for due diligence provides B2B SaaS vendors and acquirers with a structured, actionable framework to navigate this critical phase.

We will dissect the ten essential pillars of a successful review, providing detailed guidance on what to look for, the right questions to ask, and how to interpret the answers. Preparing for these rigorous examinations is paramount. For SaaS companies, responding to extensive customer security questionnaires can be a significant bottleneck, delaying deals and consuming valuable engineering resources. Failing to provide organised, policy-referenced answers quickly erodes trust and can halt a sale in its tracks.

This guide is designed to be a practical tool. It will not only help you conduct better due diligence but also prepare you to be on the receiving end. By following this checklist, you can ensure your organisation is ready to demonstrate its value, security posture, and operational integrity with confidence and speed. Let’s move beyond the traditional balance sheet analysis and explore the modern components of a truly effective due diligence process.

1. Financial Statements Review

A cornerstone of any comprehensive checklist for due diligence is the meticulous review of a company’s financial statements. This process involves a deep dive into audited and unaudited documents, including balance sheets, income statements, and cash flow statements. The primary goal is to assess the target company’s financial health, confirming its profitability, liquidity, and solvency. A thorough financial review can uncover the true economic state of a business, moving beyond surface-level claims to hard data.

This analysis is fundamental because it provides an objective measure of past performance and a basis for future projections. It helps identify potential red flags such as inconsistent revenue recognition, unusually high expenses, or significant accounting policy changes that could distort the company’s perceived value. Without this step, an acquirer or investor is essentially navigating blind, risking overpayment or inheriting unforeseen liabilities.

Why It’s Crucial for Your Checklist

Financial statement analysis forms the bedrock of valuation and risk assessment. For example, during Microsoft’s acquisition discussions with Facebook, a detailed financial review was instrumental in justifying the valuation. Similarly, the a deep margin analysis of Amazon in its early days revealed the long-term sustainability of its business model, which might not have been obvious from top-line revenue figures alone. Conversely, a failure to perform this step can be catastrophic, as seen in the Enron scandal, where proper pre-acquisition analysis could have revealed significant undisclosed liabilities hidden in off-balance-sheet entities.

Actionable Tips for Implementation

To execute this part of your due diligence checklist effectively, consider the following practical steps:

• Engage Independent Auditors: Do not rely solely on the company’s recommended auditors. An independent firm, ideally one of the Big Four (Deloitte, PwC, EY, KPMG), can provide an unbiased and rigorous assessment.
• Benchmark Performance: Compare key financial metrics like gross margin, operating margin, and revenue growth against industry benchmarks. This contextualises the company’s performance and highlights areas of strength or weakness.
• Scrutinise Accounting Policies: Investigate any changes in accounting policies from one year to the next. Such changes can artificially inflate revenue or understate expenses, so understanding their impact is vital.
• Verify Independently: Go beyond the provided statements. Request and independently verify bank statements, reconciliations, and detailed schedules that support major line items like accounts receivable and inventory.

2. Legal and Regulatory Compliance Review

A critical component of any checklist for due diligence is the comprehensive examination of the target company’s legal and regulatory compliance. This process involves a thorough assessment of adherence to all applicable laws, regulations, and industry standards, covering areas such as corporate governance, licensing, permits, labour laws, and data protection. The objective is to identify any existing or potential legal liabilities that could translate into significant financial penalties, operational disruptions, or reputational damage for an acquirer.

This legal audit is indispensable because non-compliance can create devastating, and often hidden, risks. A company might appear financially sound on paper, yet be exposed to crippling fines or even business suspension due to regulatory breaches. Uncovering these issues beforehand allows the acquiring party to quantify the risk, negotiate the price accordingly, or in severe cases, walk away from the deal entirely.

Why It’s Crucial for Your Checklist

Legal and regulatory analysis protects an investor or acquirer from inheriting costly liabilities. For example, the scrutiny of Facebook’s operations leading up to the Cambridge Analytica scandal revealed significant data privacy compliance gaps that had enormous financial and reputational consequences. Similarly, Uber’s global expansion was frequently hampered by failures to comply with local transport licensing laws, leading to legal battles and operational bans in major cities. In contrast, a company that can demonstrate a robust compliance framework presents a much lower-risk investment. This step ensures you are not just buying assets, but also unforeseen and expensive legal problems.

Actionable Tips for Implementation

To properly execute a legal and regulatory compliance review, consider these practical steps:

• Engage Local Legal Counsel: For companies operating across multiple regions, engage local law firms in each key jurisdiction. They possess the specialised knowledge of regional regulations that a single firm may lack.
• Maintain a Compliance Matrix: Request or build a detailed compliance matrix that maps business activities to specific regulations by jurisdiction. This organised approach helps ensure no critical area is overlooked. For a deeper understanding of specific requirements, exploring resources on a UK data protection policy template can be highly beneficial.
• Review All Regulatory Correspondence: Insist on reviewing all communications with regulatory bodies (like the SEC, FCA, or ICO) from the past five years. This can reveal ongoing investigations, disputes, or areas of concern flagged by regulators.
• Conduct Independent Verification: Do not rely solely on the company’s assertions. Independently verify crucial licences, permits, and certifications with the relevant issuing authorities to confirm they are valid and in good standing.

3. Market and Competitive Analysis

An indispensable part of any checklist for due diligence is a rigorous evaluation of the target company’s market position and competitive landscape. This involves assessing the overall market size, growth potential, key industry trends, and the company’s sustainable competitive advantages. The aim is to understand the external forces influencing the business and to validate its strategic direction and financial projections. A thorough market analysis provides the context needed to determine if the company’s success is a result of a strong business model or simply a rising market tide.

This examination is vital because it reveals the long-term viability of the target company’s offerings. It helps an acquirer or investor gauge the sustainability of its market share, the loyalty of its customer base, and its resilience against new entrants or technological shifts. Without this strategic perspective, a deal could be based on historical performance that may not be repeatable in a changing market, leading to a poor return on investment.

Why It’s Crucial for Your Checklist

Market and competitive analysis provides a reality check on a company’s growth story. For instance, Google’s strategic analysis of the mobile operating system market was fundamental to its acquisition of Android, correctly identifying the long-term dominance of mobile platforms. Similarly, Amazon’s deep dive into the retail sector’s weaknesses and inefficiencies paved the way for its e-commerce disruption. Conversely, failing to analyse market dynamics can be disastrous; consider how many companies underestimated the shift to cloud computing and lost significant market share. Frameworks like Porter’s Five Forces, popularised by consultancies like McKinsey & Company, are essential tools in this process.

Actionable Tips for Implementation

To properly execute this step in your due diligence checklist, consider these practical actions:

• Use Multiple Research Sources: Do not rely on a single report. Triangulate data from various market research firms like Gartner, Forrester, and IDC to build a comprehensive market view.
• Analyse Customer Metrics: Go beyond financials and analyse customer satisfaction scores (CSAT, NPS), churn rates, and customer concentration. High dependency on a few clients is a significant risk.
• Interview Key Stakeholders: Speak directly with the target’s key customers, and even their competitors’ customers, to gain unfiltered insights into product strengths, weaknesses, and unmet market needs.
• Assess the Product Roadmap: Evaluate the company’s planned product developments against emerging market trends and competitor movements to ensure its strategy is forward-looking and not reactive.

4. Customer and Revenue Quality Assessment

A critical component of any effective checklist for due diligence is a detailed assessment of a company’s customer base and revenue quality. This involves scrutinising revenue sources, customer contracts, and concentration risk to determine the stability and sustainability of its income. The primary objective is to evaluate the health of the company’s revenue streams by analysing customer demographics, contract terms, renewal rates, and over-reliance on a few major clients.

This analysis is vital because top-line revenue figures alone can be misleading. A business might show strong growth, but if that growth comes from a single, non-renewable contract or a handful of at-risk clients, the future is precarious. Uncovering high customer churn, significant revenue concentration, or contracts with unfavourable terms provides a more accurate picture of long-term viability and potential vulnerabilities.

Why It’s Crucial for Your Checklist

Assessing customer and revenue quality directly informs valuation and predicts future performance. For instance, before its IPO, Slack’s deep analysis of customer retention and net dollar expansion demonstrated a highly sustainable and scalable business model, justifying its high valuation. Conversely, a potential red flag would be Twitter’s historical reliance on a small number of large advertising platforms, which created a significant concentration risk that needed careful evaluation by any potential acquirer. Understanding these dynamics is essential for avoiding investments in companies with fragile or inflated revenue streams.

Actionable Tips for Implementation

To properly evaluate customer and revenue quality as part of your due diligence checklist, implement these steps:

• Analyse Customer Concentration: Request a detailed customer list with contract values and renewal dates. Independently calculate the percentage of total revenue derived from the top 5, 10, and 20 customers to identify dependency risks.
• Verify Recurring Revenue: Don’t just take recurring revenue claims at face value. Scrutinise actual payment histories and contracts to confirm that revenue is genuinely recurring and not based on one-off services.
• Interview Key Customers: If possible, interview a selection of the top customers to gauge their satisfaction, their relationship with the company, and their intentions for renewal. This provides qualitative insight that numbers alone cannot.
• Investigate Customer Churn: Analyse the reasons for customer loss by reviewing exit interview notes or internal reports. High churn due to product issues or poor service is a significant warning sign that needs to be factored into your assessment.

5. Intellectual Property (IP) and Technology Review

A critical component of any modern checklist for due diligence, especially in the technology sector, is a comprehensive review of the target company’s intellectual property (IP) and underlying technology. This involves a deep assessment of the company’s portfolio, including patents, trademarks, copyrights, and trade secrets. The objective is to validate ownership, assess the strength and defensibility of these assets, and identify any potential infringement risks or limitations on the freedom to operate.

This analysis is indispensable because, for many tech and SaaS companies, IP is their most valuable asset. A thorough review confirms that the company truly owns its proprietary code, brand identity, and innovative processes. It uncovers potential issues like reliance on poorly licenced open-source software or key IP being owned by former employees or contractors. Failing to scrutinise the IP portfolio is akin to buying a house without verifying the deed; you might be acquiring significant, hidden liabilities.

Why It’s Crucial for Your Checklist

IP and technology review is fundamental to confirming a company’s competitive advantage and future value. For instance, when Google acquired Motorola Mobility, the primary driver was its extensive patent portfolio, which was crucial for defending the Android ecosystem against litigation. Similarly, Apple’s acquisition of Beats involved a detailed review of both its patent portfolio and brand trademarks to ensure they were acquiring a clean and defensible asset base. A failure in this area can be devastating; a company might find itself unable to sell its core product due to an unforeseen patent dispute or an open-source licence conflict.

Actionable Tips for Implementation

To properly execute this part of your due diligence checklist, follow these practical steps:

• Conduct a Freedom-to-Operate (FTO) Analysis: Engage specialised patent counsel to analyse whether the company’s technology infringes on existing patents held by others. This is vital for mitigating future litigation risks.
• Review All IP Assignment Agreements: Ensure that all employees and contractors have signed agreements assigning their intellectual property contributions to the company. This confirms clear and undisputed ownership.
• Audit Open-Source Software (OSS) Usage: Utilise tools like those from Black Duck to scan the company’s codebase for open-source components. Verify compliance with all associated licences, as some can have restrictive terms.
• Validate Trade Secret Protection: Request and review documentation outlining the measures taken to protect trade secrets, such as non-disclosure agreements (NDAs), access controls, and employee training programmes.

6. Management and Organization Assessment

An often-underestimated part of a checklist for due diligence is the assessment of the target company’s management team and organisational structure. This involves a qualitative evaluation of leadership capabilities, key personnel dependencies, and overall corporate culture. The aim is to understand the human capital that drives the business, as a strong team is often more valuable than the assets on the balance sheet.

This assessment is vital because the success of any acquisition or investment heavily relies on the people who will execute the strategic plan post-transaction. A brilliant business model can falter under poor leadership, while a strong management team can navigate unforeseen challenges. Uncovering potential leadership gaps, retention risks, or a misaligned company culture is critical to forecasting future performance and ensuring a smooth integration.

Why It’s Crucial for Your Checklist

Assessing leadership is a key predictor of long-term success. For instance, when Facebook acquired Instagram, a major factor was the confidence in its small, agile management team’s ability to continue innovating. Similarly, Salesforce’s acquisition of Slack involved integrating key Slack executives to retain the product’s visionary leadership. Conversely, neglecting this step can lead to a clash of cultures and an exodus of key talent, undermining the entire rationale for an acquisition, as has been a risk in situations like Elon Musk’s takeover of Twitter.

Actionable Tips for Implementation

To properly evaluate the human element as part of your due diligence checklist, follow these practical steps:

• Conduct Background Checks: Perform thorough, independent background checks on all C-suite executives and key decision-makers to verify their track records and credentials.
• Interview Key Personnel: Go beyond the executive team. Interview key managers and high-performing individuals separately to gauge morale, understand their future plans, and identify potential retention issues.
• Review Employment Agreements: Scrutinise all senior management employment contracts, paying close attention to compensation, incentive structures, and any change-of-control provisions that could trigger large payouts. Learn more about the intricacies of vendor due diligence and team assessment to prepare for this.
• Assess the Organisational Culture: Use anonymous employee surveys or focus groups to get an unfiltered view of the company culture. A significant mismatch in values can be a major integration hurdle.

7. Operational and Asset Analysis

Beyond the balance sheet, a vital component of any checklist for due diligence involves a detailed review of the company’s operational infrastructure. This analysis examines the physical and digital assets, supply chain robustness, production capacity, and overall operational efficiency. The main objective is to understand how the business functions on a day-to-day basis, identifying potential risks, the condition of its assets, and its ability to scale effectively.

This step is critical because it unearths the tangible reality behind the numbers. A company might have strong financials, but if its core machinery is outdated, its key supplier is on shaky ground, or its technology infrastructure is fragile, significant hidden liabilities and integration challenges may exist. Operational diligence provides a clear picture of the company’s long-term sustainability and the true cost of maintaining its performance post-acquisition.

Why It’s Crucial for Your Checklist

Operational analysis reveals the practical strengths and weaknesses that financial statements alone cannot. For example, when Amazon assessed Whole Foods, a huge part of the due diligence centred on its physical store footprint, supply chain, and in-store operational processes to see how they could be integrated with Amazon’s logistics network. Similarly, Microsoft’s acquisition of LinkedIn required a deep dive into its cloud infrastructure to ensure scalability and compatibility. Neglecting this area can lead to post-merger chaos, where expected synergies fail to materialise due to unforeseen operational hurdles.

Actionable Tips for Implementation

To properly execute an operational and asset analysis as part of your due diligence checklist, follow these steps:

• Conduct Physical Site Visits: Nothing replaces seeing the operations first-hand. Inspect facilities, observe production lines, and assess the condition of key equipment and real estate.
• Review Maintenance and CapEx Records: Examine the history of capital expenditure and maintenance logs. This reveals how well assets are maintained and flags any upcoming, significant investment requirements.
• Assess Key Supplier Relationships: Analyse contracts with critical suppliers to understand terms, dependencies, and potential risks. Is the company overly reliant on a single source?
• Benchmark Operational Metrics: Compare key performance indicators like inventory turnover rates, production cycle times, and quality control data against industry standards to identify areas of underperformance or excellence.

8. Environmental, Social, and Governance (ESG) Review

A modern and increasingly vital component of any checklist for due diligence is a thorough Environmental, Social, and Governance (ESG) review. This process assesses a company’s non-financial performance, evaluating its environmental impact, social responsibilities, and internal governance structures. The objective is to understand potential risks and opportunities that may not be apparent from financial statements alone, such as regulatory fines, reputational damage, or operational inefficiencies.

This evaluation is no longer a fringe consideration; it’s a critical gauge of a company’s long-term sustainability and resilience. Poor ESG practices can lead to substantial liabilities and erode brand value. By scrutinising these factors, an investor or acquirer gains a more holistic view of the target business, identifying hidden risks and confirming its commitment to ethical, sustainable operations in a world where stakeholders demand greater accountability.

Why It’s Crucial for Your Checklist

ESG factors are now intrinsically linked to financial performance and risk management. For instance, the scrutiny of Facebook’s content moderation policies (a social issue) directly impacted its valuation and led to increased regulatory oversight. Similarly, BP’s handling of the Deepwater Horizon disaster highlighted the immense financial fallout from environmental failings. Conversely, companies with strong ESG profiles often demonstrate better operational management and a more forward-thinking strategy, making them more attractive long-term investments. Ignoring ESG is to ignore a significant category of business risk.

Actionable Tips for Implementation

To integrate an effective ESG review into your due diligence checklist, follow these practical steps:

• Review Environmental Permits and Assessments: Request and analyse all environmental impact assessments, permits, and reports. For physical assets, consider conducting Phase I Environmental Site Assessments to identify potential contamination liabilities.
• Analyse Social Policies and Metrics: Examine the company’s policies on diversity and inclusion, employee health and safety, and labour practices within its supply chain. Review hiring metrics and employee turnover rates to gauge workplace culture.
• Assess Governance Structures: Scrutinise the company’s board composition, executive compensation policies, and shareholder rights. Compare these against industry best practices to identify potential conflicts of interest or weak oversight.
• Evaluate IT Asset Disposal: A key part of modern ESG is managing electronic waste. Examining how a company handles its IT assets is crucial, and understanding how corporate computer recycling to boost ESG and security can reveal its commitment to sustainable and secure practices.

9. Contracts and Material Agreements Review

A vital part of any checklist for due diligence is the comprehensive examination of all material contracts and agreements. This process involves a meticulous review of legally binding documents, such as customer agreements, supplier contracts, employment terms, software licences, leases, and debt covenants. The objective is to understand the target’s obligations, rights, and potential liabilities, ensuring no hidden risks are embedded within its commercial relationships.

This analysis is essential because contracts define the operational and financial reality of a business. They can reveal critical dependencies, restrictive clauses, and financial commitments that directly impact valuation and future strategy. Uncovering issues like problematic change-of-control provisions or significant customer concentration early on allows an acquirer to anticipate post-transaction challenges and negotiate terms more effectively, preventing costly surprises down the line.

Why It’s Crucial for Your Checklist

Reviewing material agreements provides a clear picture of a company’s commitments and its ability to operate post-acquisition. For instance, during Amazon’s acquisition of Whole Foods, a thorough review of supplier agreements was critical to understanding the complexities of its supply chain and potential integration challenges. Similarly, Microsoft’s deep dive into Activision Blizzard’s licensing agreements was fundamental to valuing its intellectual property and future revenue streams. Failing to identify restrictive debt covenants, as was a key concern in the lead-up to Elon Musk’s acquisition of Twitter, could have triggered defaults and jeopardised the entire transaction.

Actionable Tips for Implementation

To properly execute this part of your due diligence checklist, follow these practical steps:

• Create a Centralised Register: Request a detailed contract register or summary that outlines key terms for all material agreements, including parties, dates, value, and renewal/termination details.
• Prioritise by Materiality: Focus first on high-value contracts or those critical to operations. Define a materiality threshold (e.g., all contracts over £100,000 in annual value) to guide the review process efficiently.
• Identify Change-of-Control Triggers: Scrutinise every agreement for clauses that require consent or permit termination in the event of an ownership change. These can present significant obstacles if not addressed early.
• Assess Commercial Terms: Evaluate pricing structures, volume discounts, and renewal provisions to forecast future revenue and costs accurately. Look for any terms that may become unfavourable after the transaction.

10. Data, Cybersecurity, and Information Systems Review

In today’s digital economy, a company’s data is often one of its most valuable assets, making a comprehensive review of its cybersecurity posture an essential part of any checklist for due diligence. This evaluation scrutinises the target company’s IT infrastructure, data protection practices, and overall information security risks. The core objective is to understand the strength of its security controls, its compliance with data privacy regulations, and its resilience against cyber threats.

This review is vital because a security vulnerability can lead to catastrophic financial and reputational damage, significantly devaluing an acquisition or investment. A thorough assessment uncovers latent risks such as poor data handling, inadequate security protocols, or a history of undisclosed breaches. A critical component involves implementing robust strategies for handling confidential information, ensuring data security is maintained throughout the due diligence process itself.

Why It’s Crucial for Your Checklist

Assessing data and cybersecurity is fundamental to understanding a company’s true operational risk profile and potential hidden liabilities. For example, Yahoo’s valuation was reduced by $350 million in its acquisition by Verizon after massive, previously undisclosed data breaches came to light. Conversely, Microsoft’s successful acquisition of LinkedIn involved a detailed security assessment, ensuring the platform’s infrastructure and data protection measures met their stringent standards. Failing to prioritise this step can expose an organisation to significant post-acquisition clean-up costs and regulatory fines.

Actionable Tips for Implementation

To properly evaluate data security and IT systems within your due diligence checklist, follow these practical steps:

• Conduct Independent Penetration Testing: Commission an independent cybersecurity firm to perform penetration testing and a vulnerability assessment. This provides an unbiased view of the company’s real-world security posture.
• Request Security Audits and Certifications: Ask for all relevant audit reports, such as SOC 2 Type II or ISO 27001 certifications. These documents offer third-party validation of the company’s security controls. For more guidance on this topic, explore these 10 essential information security policy examples.
• Review Incident Response Plans: Examine the company’s documented incident response and disaster recovery plans. Assess their breach history to understand how they have managed past security incidents.
• Assess Data Privacy Compliance: Verify compliance with key regulations like GDPR, CCPA, and other relevant international standards. This is particularly important for businesses handling sensitive personal data.

10-Point Due Diligence Checklist Comparison

From Checklist to Confidence: Streamlining Your Path to a Successful Deal

Navigating the landscape of B2B transactions, from major acquisitions to enterprise sales, hinges on the rigour of your due diligence process. The comprehensive checklist for due diligence we have explored is more than a procedural formality; it is the foundational framework for building trust, quantifying risk, and unlocking genuine value. Moving beyond a simple box-ticking exercise, this process transforms abstract data points into a cohesive narrative about a company’s health, stability, and future potential.

By systematically evaluating the ten core domains, from financial stability and legal compliance to cybersecurity posture and operational efficiency, you replace assumptions with evidence. This meticulous approach ensures that decisions are not based on surface-level impressions but on a deep, multi-faceted understanding of the business in question. For B2B SaaS vendors, being on the receiving end of this scrutiny means that preparation is not just an advantage, it is a prerequisite for success.

Key Takeaways: From Reactive to Proactive

The central theme throughout this guide is the strategic shift from a reactive to a proactive stance. Instead of scrambling for documentation when a security questionnaire or M&A request arrives, the most successful organisations build a state of continuous readiness.

• Centralise Your Knowledge: Disorganised information is a primary bottleneck. A centralised repository for all your critical documentation, from SOC 2 reports and penetration test results to data processing agreements and security policies, is non-negotiable.
• Embrace Transparency: Obscurity breeds suspicion. Clear, well-documented evidence of your security controls, compliance certifications, and operational processes demonstrates maturity and inspires confidence in prospective partners and customers.
• Integrate Technology: Manual processes are slow, error-prone, and unsustainable. Leveraging technology to manage and disseminate due diligence information is a critical force multiplier, especially for lean teams.

A Strategic Insight: The goal is not merely to pass a due diligence review but to excel at it. A swift, thorough, and professional response signals operational excellence and a robust security culture, which can become a significant competitive differentiator in a crowded market.

Actionable Next Steps: Building Your Due Diligence Engine

Transforming this extensive checklist into a streamlined, repeatable process is your ultimate objective. Here are your immediate next steps to turn theory into practice:

1. Conduct a Gap Analysis: Use the ten checklist areas as a benchmark to audit your own organisation. Identify which documents are readily available, which need updating, and which are missing entirely. Pay special attention to the Data, Cybersecurity, and Information Systems section, as this is often the most intensive area of scrutiny for SaaS companies.
2. Establish a “Source of Truth”: Designate a secure, centralised platform as your single source of truth for all due diligence-related information. This eliminates version control issues and ensures consistency across all responses, from RFPs to security audits.
3. Leverage Automation and AI: Investigate solutions that can automate the repetitive aspects of responding to due diligence requests. AI-powered platforms can analyse incoming questionnaires, pull verified answers from your knowledge base, and cite the relevant policy or evidence, reducing manual effort from days to minutes. This not only accelerates your sales cycle but also frees up your technical experts to focus on innovation rather than administration.

Mastering your response to this checklist for due diligence is a direct investment in your company’s growth. It reduces friction in the sales process, shortens deal cycles, and builds a reputation for reliability and security. By organising your evidence, standardising your responses, and leveraging intelligent automation, you move from a position of stressful reaction to one of confident control. You are no longer just answering questions; you are demonstrating a commitment to excellence that underpins every successful and lasting business relationship.