Ecommerce Due Diligence Checklist

Check ecommerce financials, inventory, suppliers, advertising, customers, returns and platform risk.

Orders And Revenue

Reconcile store data to payment processors and bank records.

Inventory

Verify quantity, ownership, landed cost, age and storage obligations.

Marketing

Review ad accounts, CAC, channel concentration and creative dependence.

Suppliers And Fulfillment

Confirm terms, lead times, exclusivity, quality issues and transferability.

Create A Request List And Evidence Standard

Before reviewing documents, decide what counts as evidence. Prefer read-only access, exports from source systems, processor records, bank statements, contracts and repository access over isolated screenshots. Keep a request list with the claim being tested, the evidence received, the period covered, unresolved questions and who is responsible for the follow-up. This makes it harder for a persuasive narrative to outrun the underlying facts.

Reconcile Claims Across Systems

Strong diligence looks for agreement between independent records. Revenue shown in a storefront should broadly reconcile with payment processing and cash received after timing differences, fees, refunds and taxes. Traffic claims should match analytics and, where relevant, search or advertising platforms. Staffing and software costs should make sense relative to the operating process the seller describes. Mismatches are not automatically fraud, but they require an explanation before you price the deal.

Separate Fixable Problems From Thesis-Breaking Risks

Not every issue deserves the same response. Messy documentation may be fixable; unclear intellectual-property ownership, non-transferable core accounts, extreme customer concentration or a product that cannot be maintained without the founder can change the acquisition thesis. Classify findings as informational, price-adjusting, deal-structure issues, closing conditions or reasons to walk away. That classification turns diligence into a decision process instead of an endless checklist.

Document The Closing Conditions

Important diligence findings should not disappear when negotiations move to closing. Translate them into the transaction process: assets that must be delivered, consents that must be obtained, data that must remain true at closing, transition support, inspection periods and any holdback or contingent consideration. Deal-specific legal and tax terms should be reviewed by qualified professionals.

Inventory And Working Capital

Inventory can materially change both price and post-close cash needs. Verify units, landed cost, age, sell-through, storage obligations and whether stock is included in the headline purchase price. Model how much cash must remain available for replenishment, freight, returns and advertising after closing. A profitable store can still create a liquidity problem if its working-capital cycle is misunderstood.

Customer Acquisition And Supply Chain

Review paid and organic acquisition separately, including account ownership, CAC trends, creative dependence and repeat purchase behavior. On the supply side, identify single-source products, lead times, minimum orders, quality problems, exclusivity and whether supplier terms continue after a sale. Revenue diversification is less reassuring when all products ultimately depend on one supplier or one advertising account.

Practical Review Record

How To Organize The Review

Create folders for financials, customers or traffic, operations, technology, legal and transfer. Keep a question log beside the documents so every unresolved item has an owner and status. Record where each important number came from. This is especially useful when several versions of a P&L, analytics export or customer report circulate during negotiations.

When To Escalate To Specialists

Bring in specialist help when the risk exceeds your ability to verify it. Examples include complex codebases, security or privacy exposure, regulated products, significant tax questions, intellectual-property uncertainty, unusual contracts or financial statements that require quality-of-earnings work. The cost of specialist review should be weighed against deal size and the consequence of getting the issue wrong.

What A Good Diligence Conclusion Looks Like

The output should not be a pile of documents. It should state which claims were verified, which remain uncertain, the material risks, the financial adjustments, the required closing conditions and whether the original investment case still holds. That conclusion gives the buyer a basis for proceeding, repricing, restructuring or stopping the deal.

Action Checklist

• Write down the business or transaction objective before reviewing the opportunity.
• Collect primary-source evidence for every claim that materially affects value.
• Identify concentration, owner dependence, platform exposure and transfer constraints.
• Translate important findings into price, structure, closing conditions or a decision not to proceed.
• Keep a written handover plan covering assets, access, responsibilities and post-close support.

The purpose of the checklist is not to create paperwork for its own sake. It is to make the decision reproducible: another informed reviewer should be able to see what evidence was considered, which assumptions remain uncertain and why the transaction terms reflect those risks.

Related Guides

• Online Business Due Diligence Checklist