Who typically conducts vendor due diligence?

The management team of the seller typically conducts vendor due diligence because they have the most comprehensive knowledge of the company's operations, financial health, and market position. They are responsible for preparing the necessary documentation and data to present to potential buyers, ensuring that all pertinent information about the business is available for review. This process allows the seller to facilitate transparency during the sale process, as having a thorough understanding of their own business can help address any concerns that potential buyers might have.

In vendor due diligence, the seller is essentially laying the groundwork for a smoother transaction by proactively identifying and disclosing any risks, liabilities, or issues that could affect the sale. This can also help to build trust and credibility with potential buyers, ultimately supporting a successful sales process.

Other options involve different parties that generally do not conduct vendor due diligence directly. Third-party consultants typically work for the buyer, assisting in their due diligence process rather than the vendor's. Internal team members from the buying company are primarily focused on assessing the target company and may not have insights into the seller's workings. Regulatory agencies carry out their own evaluations for compliance purposes but do not participate in in-depth vendor due diligence processes.