Business due diligence is not just a survey: it also needs to know how to analyze and communicate.

Abstract: Business due diligence is an important part of investment decision-making, which requires not only a comprehensive investigation of the target company's internal and external environment and operations, but also a review and evaluation of the key assumptions of its business plan and an analysis of its business prospects and sustainability. Shangpu Consulting is a well-known independent third-party research and investment and financing consulting institution in China. It has rich business due diligence experience and professional consulting team. It can provide customers with customized business due diligence solutions and help customers make effective investment. Value judgment and risk control. This article will introduce the characteristics and advantages of Shangpu Consulting's commercial due diligence service, as well as the application cases in actual projects, and show how Shangpu Consulting can provide professional support and guidance for customers' investment decisions through in-depth analysis and effective communication.

Keywords: Champ Consulting, Business Diligence, Investment Decisions, Value Judgment, Risk Control

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Definition and purpose of commercial due diligence

Commercial due diligence (Commercial Due Diligence,CDD) refers to the investigation of the internal and external environment and situation of the company's business development by a professional management and consulting team from the outside and inside after the investor has reached an initial cooperation intention with the target company, to evaluate and analyze the key factors for the company to reach its development plan, and to study the business prospect and future development trend of the target company.

The purpose of commercial due diligence is to provide value judgment and correction basis for investment decision-making, to help investors understand the real situation and potential risks of the target company, to assess the competitiveness and profitability of the target company, to determine a reasonable investment price and transaction structure, and to develop effective follow-up management and integration strategies.。

Content and methodology of commercial due diligence

The content of commercial due diligence generally includes the following aspects:

Macro-environmental analysis: analyze the development trends and influencing factors of the industry and market in which the target company is located, such as economic, political, legal, social, technological and other changes, as well as the size, growth rate, concentration, barriers, norms and other characteristics of the industry.。

Market analysis: analyze the market positioning and market share of the target company, as well as the needs, preferences, purchase behavior and satisfaction of its target customers, and evaluate the market attractiveness and market potential of the target company.。

Competitive environment analysis: analyze the strengths and weaknesses of the target company's main competitors in terms of strategy, products, prices, channels, marketing, innovation, etc., as well as the target company's competitive strategy and competitive advantages.。

Business process analysis: analyze the operation mode and process of the target company's core business, such as research and development, production, sales, service, etc., and evaluate the operational efficiency and quality control of the target company.。

Enterprise infrastructure analysis: analyze the target company's organizational structure, management team, human resources, financial situation, information technology and other support capabilities, and evaluate the target company's internal management and coordination capabilities.。

Commercial due diligence methods generally include the following:

Desk research: through the collection and collation of public information and internal information of the target company, such as official website, business registration, industry reports, news reports, research reports of listed companies in the same industry, forum reviews, professional databases, etc., to understand the basic situation of the target company and the general situation of the industry in which it is located.。

Management interview: through in-depth face-to-face or telephone interviews with senior management and key department heads of the target company, to understand the details of the target company's strategic planning, business development, market situation, competitive advantages, risks and challenges, etc.。

Customer and Supplier Interviews: Through random or targeted interviews with existing or potential customers and suppliers of the target company, understand the external evaluation of the target company's product quality, service level, price strategy, partnership, reputation, etc.

Competitor interviews: through secret or public interviews with direct or indirect competitors of the target company, we can understand the strategic intention, product characteristics, market dynamics, competitive advantage, competitive strategy and other aspects of the competitor.

Field visits: Through field visits to the target company's production bases, warehouses, offices, sales outlets, etc., to observe the actual situation of the target company's production equipment, inventory, working environment, staff quality, customer feedback, etc.

Features and advantages of the commercial due diligence service of Champ Consulting

Shangpu Consulting is a well-known independent third-party research and investment and financing consulting institution in China. It has rich business due diligence experience and professional consulting team. It can provide customers with customized business due diligence solutions and help customers make effective investment. Value judgment and risk control. The commercial due diligence service of Champ Consulting has the following features and advantages:

Customer-oriented: According to the customer's investment purpose and needs, Shangpu Consulting formulates the appropriate scope and depth of commercial due diligence, and provides customers with tailor-made commercial due diligence programs to ensure the pertinence and effectiveness of commercial due diligence.

Data-driven: Shangpu Consulting collects and analyzes a large amount of first-hand and second-hand data through various channels and methods, and uses advanced data analysis tools and models to provide customers with objective, accurate, timely and continuous data support to ensure the reliability and scientificity of business due diligence.

Industry expert: Champ Consulting has.1000Remaining positionConsultants, distributed in machinery, building materials, electronics, chemicals, medicine, energy, food, logistics, culture, education, finance, Internet and other industries, can provide customers with in-depth, professional and authoritative industry insights and suggestions to ensure the professionalism and foresight of business due diligence.

Communication and cooperation: Shangpu Consulting maintains close communication and cooperation with customers, timely feedback the progress and results of commercial due diligence, actively listens to customers' opinions and suggestions, and adjusts the direction and focus of commercial due diligence according to customers' needs and feedback to ensure the satisfaction and effectiveness of commercial due diligence.

The application case of Champ Consulting's commercial due diligence service.

Champu Consulting has rich project experience and successful cases in the field of commercial due diligence. The following are some typical cases:

Case 1: An international investment fund conducts commercial due diligence on China's leading online education platform

Project background: The investment fund plans to make strategic investments in China's leading online education platform, which mainly providesK12 online courses and online tutoring services have more than 50 million registered users and 2 million paid users, with a market share of 15%.

Project Objective: The investment fund hopes to understand the market positioning and competitive advantages of the platform through commercial due diligence, evaluate its business model and profitability, analyze its future growth potential and risk challenges, and determine reasonable investment valuation and trading conditions.

Project approach: Champ Consulting has provided comprehensive commercial due diligence services for the investment fund, including the following aspects:

Macro-environment analysis: The development history, current situation and trend of China's online education industry are analyzed, as well as the influencing factors of policy, technology, users and competition, and the characteristics of the industry such as scale, growth rate, profit margin, concentration and barriers are evaluated.

Market analysis: The market positioning and market share of the platform are analyzed, as well as the needs, preferences, purchase behavior and satisfaction of its target customers, and the market attractiveness and market potential of the platform are evaluated.

Competitive environment analysis: Analyze the strengths and weaknesses of the platform's main competitors in terms of strategy, products, prices, channels, marketing, innovation, etc., as well as the platform's competitive strategies and competitive advantages.

Business process analysis: the operation mode and process of the core business of the platform, such as curriculum development, teacher recruitment, teaching management, learning evaluation, etc., are analyzed, and the operational efficiency and quality control of the platform are evaluated.

Enterprise infrastructure analysis: analysis of the platform's organizational structure, management team, human resources, financial situation, information technology and other aspects of support capabilities, to assess the platform's internal management and coordination capabilities.

Project Results: Champ Consulting has provided a detailed commercial due diligence report for the investment fund, including conclusions and recommendations in the following areas:

The platform has strong competitiveness and leading position in China's online education industry, its business model and profitability are relatively stable, its future growth potential and risk challenges are more balanced, and its investment value is high.

The reasonable valuation range of the platform is8 billion to 10 billion US dollars, it is recommended that the investment fund invest with a 10% to 15% equity ratio to obtain a higher investment return and control.

The investment fund should maintain a good cooperative relationship with the platform after investment, and provide it with strategic guidance, resource support, market expansion and other assistance to promote its sustainable development and value enhancement.

Case 2: A well-known domestic pharmaceutical company conducts commercial due diligence on a biotechnology company.

Project background: The pharmaceutical company plans to acquire a biotechnology company. The biotechnology company is mainly engaged in the research and development and production of new antibody drugs. It has a number of innovative drugs in the clinical trial stage and has a broad market prospect.

Project Objective: The pharmaceutical company hopes to understand the biotechnology company's R & D capabilities and product quality through commercial due diligence, assess its technological advantages and market potential, analyze its future revenue and cost forecasts, and determine a reasonable M & A price and transaction structure.

Project approach: Champ Consulting provided the pharmaceutical company with comprehensive commercial due diligence services, including the following:

Macro-environment analysis: Analyzed the development history, current situation and trends of the global and Chinese antibody drug industry, as well as the influencing factors of policy, technology, users, competition, etc., and evaluated the industry's scale, growth rate, profit margin, concentration, barriers and other characteristics.

Market Analysis: Analyzed the market positioning and market share of the biotechnology company, as well as the needs, preferences, purchasing behavior and satisfaction of its target customers, and evaluated the market attractiveness and market potential of the biotechnology company.

Competitive environment analysis: analyzes the strengths and weaknesses of the biotechnology company's main competitors in terms of strategy, products, prices, channels, marketing, innovation, etc., as well as the biotechnology company's competitive strategy and competitive advantages.

Business process analysis: The operation mode and process of the core business of the biotechnology company, such as research and development, production, sales, service, etc., were analyzed, and the operational efficiency and quality control of the biotechnology company were evaluated.

Enterprise infrastructure analysis: analyzed the biotech company's organizational structure, management team, human resources, financial situation, information technology and other support capabilities, and evaluated the biotech company's internal management and coordination capabilities.

Project Results: Champ Consulting provided the pharmaceutical company with a detailed commercial due diligence report, including conclusions and recommendations in the following areas:

The biotech company has strong R & D capabilities and product quality in the global and Chinese antibody drug industry, its technological advantages and market potential are high, its future revenue and cost forecasts are reasonable, and its M & A value is high.

The reasonable valuation range for this biotech company is1.5 billion to US $2 billion, it is recommended that the pharmaceutical company conduct mergers and acquisitions in full cash or cash plus equity to obtain higher returns and control.

The pharmaceutical company should maintain a good cooperative relationship with the biotechnology company after the merger and acquisition, and provide it with financial support, technical guidance, market expansion and other assistance to promote the development and marketing of its innovative drugs.

Case 3: A well-known domestic e-commerce platform conducts commercial due diligence on a cross-border e-commerce platform

Project background: The e-commerce platform plans to carry out strategic cooperation with a cross-border e-commerce platform, which is mainly engaged in the procurement and sales of overseas goods, with more10 million registered users and 50 million annual sales, market share of 10%.

Project objectives: The e-commerce platform hopes to understand the supply chain capabilities and product quality of the cross-border e-commerce platform through commercial due diligence, evaluate its operating model and profitability, analyze its future growth potential and risk challenges, and determine reasonable cooperation models and conditions.

Project method: Champ Consulting provides comprehensive commercial due diligence services for the e-commerce platform, including the following aspects:

Macro-environment analysis: Analyzed the development history, current situation and trends of the global and Chinese cross-border e-commerce industry, as well as the influencing factors of policy, technology, users, competition, etc., and evaluated the industry's scale, growth rate, profit margin, concentration, barriers and other characteristics.

Market analysis: The market positioning and market share of the cross-border e-commerce platform, as well as the needs, preferences, purchase behavior and satisfaction of its target customers, were analyzed, and the market attractiveness and market potential of the cross-border e-commerce platform were evaluated.

Competitive environment analysis: The advantages and disadvantages of the main competitors of the cross-border e-commerce platform, such as strategy, product, price, channel, marketing, innovation, etc., as well as the competitive strategy and competitive advantage of the cross-border e-commerce platform are analyzed.

Business process analysis: analyzed the operation mode and process of the core business of the cross-border e-commerce platform, such as procurement, warehousing, logistics, after-sales, etc., and evaluated the supply chain efficiency and product quality of the cross-border e-commerce platform.

Enterprise infrastructure analysis: the organizational structure, management team, human resources, financial situation, information technology and other support capabilities of the cross-border e-commerce platform are analyzed, and the internal management and coordination capabilities of the cross-border e-commerce platform are evaluated.

Project results: Champ Consulting provided a detailed commercial due diligence report for the e-commerce platform, including the following conclusions and recommendations:

The cross-border e-commerce platform has strong supply chain capabilities and product quality in the global and Chinese cross-border e-commerce industry, its operating model and profitability are more robust, its future growth potential and risk challenges are more balanced, and its cooperation value Higher.

The reasonable valuation range of this cross-border e-commerce platform is0.5 billion to $0.7 billion, it is recommended that the e-commerce platform cooperate in the form of equity investment or joint operation to obtain higher income and influence.

After the cooperation, the e-commerce platform should maintain a good cooperative relationship with the cross-border e-commerce platform, and provide it with brand support, traffic guidance, technology upgrades and other assistance to promote its user growth and market expansion.