Buying a business is one of the most significant financial decisions you will ever make. But even if you have found the right opportunity and secured your funding, the deal can fall apart before it even begins if your business proposal is unclear, incomplete, or unconvincing to the seller.

A well-written business acquisition proposal does more than outline numbers. It tells the seller who you are, why you are the right buyer, and how the transition will work in a way that protects both parties. In the Australian market, where due diligence expectations and legal requirements add extra layers of complexity, getting this document right matters more than most buyers realise.

This guide is written for beginners who are approaching the acquisition process for the first time. You will learn what a business acquisition proposal actually is, what to prepare before you start writing, and how to structure each section clearly and professionally. You will also discover the most common mistakes that derail deals, and the tools available to help you put together a proposal that gets taken seriously.

What Is a Business Acquisition Proposal?

A business acquisition proposal is a formal written document in which a buyer sets out their intent to purchase a business, their proposed price, and the conditions attached to that offer.

It is worth distinguishing this from two related documents. A Letter of Intent (LOI) is typically a shorter, often non-binding document that signals early interest; a heads of agreement or acquisition proposal follows with greater detail on price, structure, and conditions. A standard sales or client proposal, by contrast, pitches a product or service; an acquisition proposal carries significantly higher financial stakes and often forms the foundation for later legal negotiations.

In the transaction timeline, a proposal typically comes after a buyer has completed initial due diligence and reviewed available financials, but before a formal sale and purchase agreement is drafted. It bridges informed interest and legally binding commitment.

In Australian small business sales, proposals are often less formal than those seen in corporate mergers and acquisitions. However, submitting a structured, well-reasoned proposal, as covered in the negotiation and offer acceptance stage of selling, signals professionalism and meaningfully increases seller confidence.

Before You Write: What You Need to Know First

Before drafting your proposal, five checks will save you from costly mistakes later.

Review the financial disclosures first. Most Australian listings rely on self-reported figures. Confirm whether the listing uses verified accounting data from software like Xero, or seller-stated numbers. This distinction shapes confidence in your proposed price.

Clarify your financing position. Personal savings, a business acquisition loan, and vendor finance each produce a different offer structure and risk profile. Know your position before committing to a price range.

Understand asset sales versus share sales. These are structurally different transactions. A share sale means inheriting the company's full liability history; an asset sale lets you purchase specific assets without that exposure. Stamp duty treatment may also differ between the two structures, confirm with your solicitor.

Run a preliminary valuation. Bizzie's free instant business valuation tool provides a data-backed starting point before you put a number in writing.

Check working capital, not just profit. A business can be profitable and still leave a new owner short on operating cash from day one.

Section 1: Buyer Introduction and Background

With your preparation complete, the first section of your proposal is where you introduce yourself as a credible, trustworthy buyer.

Open with a two to three sentence professional summary: your name, your relevant industry background, and a specific reason you are interested in this particular business. Specificity matters here. "I have eight years in retail operations and I am drawn to this business because of its established supplier network" is far more compelling than a generic expression of interest.

Owner-operators have often built their business over decades. For many, completing thorough pre-purchase checks is just one part of the process; the other is finding a buyer they genuinely trust. Address this directly by naming your intention to retain existing staff and honour relationships with long-term customers.

On finances, keep it brief but concrete: note that you hold finance pre-approval or sufficient capital to complete the purchase, without disclosing account balances or personal financial statements at this stage.

Section 2: Business Overview (What You Are Proposing to Buy)

With your introduction complete, this section establishes exactly what you are proposing to acquire.

Identify the business by its full legal name, ABN, and whether you are proposing an asset sale or share sale. As noted above, the choice between share and asset sale shapes every other term in your proposal. Confirm this upfront to avoid ambiguity in later legal documentation.

Summarise the business model, key revenue streams, and customer base in two to three sentences. This signals genuine research rather than a generic offer.

State which financial data informed your offer price and whether figures were verified against accounting records or self-reported by the seller. This framing protects you if discrepancies emerge during due diligence when buying a business in Australia.

Finally, confirm the acquisition scope: specify whether the purchase includes stock, equipment, intellectual property, goodwill, existing contracts, and staff transfers.

Section 3: Proposed Purchase Price and Valuation Basis

State your proposed purchase price explicitly. The three most common valuation methods for Australian small businesses are a multiple of Seller's Discretionary Earnings (SDE), an EBITDA multiple, or an asset-based valuation where tangible assets dominate. Industry multiples vary significantly by sector; service businesses commonly trade at earnings multiples that vary widely by sector and business quality, while businesses with recurring revenue or proprietary intellectual property can attract higher multiples.

Anchor every figure to verifiable financial data. If the listing does not include verified financials, state explicitly that your offer is conditional on independent financial verification.

Section 4: Payment Structure

Once your price is set, specify how it will be paid. The three main options are:

Earnouts suit situations where historical figures are uncertain or unverified, but they are among the most frequently disputed clauses in business sales. Clear metric definitions and a dispute resolution process are essential before agreeing to one. Step 4: Do proper due diligence will help you assess what payment protections are appropriate.

Vendor finance is worth considering if your bank loan does not cover the full purchase price. The seller lends you part of the amount, repaid over time. It is common in Australian small business sales and can make otherwise unfinanceable deals work.

Finally, state your proposed deposit amount and when it becomes non-refundable. This signals genuine commitment and is frequently a negotiating point.

Section 5: Conditions and Contingencies

Once payment structure is agreed, protect yourself with clear conditions before the deal becomes binding.

Include a formal due diligence period, commonly 14 to 30 days, though the appropriate length depends on business complexity, giving you the right to inspect financial records, contracts, leases, and staff agreements. For a thorough walkthrough of what to examine, see Due Diligence When Buying a Business: The Complete Australian Guide.

If external funding is involved, add a finance approval contingency. This protects you if your lender declines or changes loan terms after the proposal is accepted.

For premises-based businesses, make the deal contingent on landlord consent to transfer or extend the existing lease. Without this clause, you could be committed to a purchase with no right to occupy the premises.

If the business holds licences or regulatory approvals, such as a liquor licence or trade qualification registrations, include conditions requiring the transfer of those approvals before settlement is complete.

Section 6: Transition and Handover Expectations

Once your conditions and contingencies are agreed, your proposal should address what happens in the weeks immediately after settlement.

Handover period: A seller-led training and handover period is typical for most Australian small businesses, commonly a few weeks, with the duration negotiated and written into the agreement. Complex businesses may require a longer handover. Specify the duration and format in your proposal.

Restraint of trade: Include a clause preventing the seller from operating a competing business within a defined geographic area for a set period. This is standard practice in Australian business sales and protects the goodwill you are paying for.

Key staff retention: Staff departures post-settlement can significantly disrupt operations in an acquired business. Identify critical roles and request written confirmation of staff intentions before settlement.

Asset transfer documentation: Customer lists, supplier agreements, trademarks, domain names, and software licences require formal transfer at settlement. List each item explicitly so nothing is overlooked in the final sale agreement.

Section 7: Timeline and Next Steps

With handover expectations documented, close your proposal with a clear timeline and a concrete invitation to act.

Provide a milestone schedule from acceptance to settlement:

Set a reasonable response deadline, typically one to two weeks. This maintains momentum and prevents the seller from using your proposal to solicit competing offers.

Name your advisers: your solicitor, accountant, and any business broker representing you. This signals an organised, professional process and reassures the seller the deal will proceed without unnecessary delays. As a general principle, respond quickly to every enquiry, the same standard applies to you as the buyer.

Close with a direct call to action: your preferred contact method and a specific suggested next step, such as a phone call or meeting to discuss terms.

Common Mistakes That Kill Business Proposals

Even a well-structured proposal can fail if these five errors are present.

Why Verified Financials Change the Proposal Process

This buyer-side risk points to a structural gap in how Australian business listings are presented: there is no standard requirement for sellers to verify their revenue or profit figures against actual accounting records, which means buyers are often negotiating against figures the seller has chosen to present.

Bizzie addresses this by allowing sellers to connect their Xero account directly to their listing. Revenue and profit figures are then drawn from live accounting data, not typed into a form by the seller.

For buyers writing a proposal, this matters in a practical way. A Xero-verified listing lets you anchor your proposed purchase price to figures already cross-checked against the seller's own accounting software, which removes a significant source of negotiation friction.

When both parties trust the underlying numbers, the conversation shifts from "are these figures accurate?" to negotiating deal structure, payment terms, and conditions. That shift produces faster, cleaner transactions.

Free Tools to Help You Prepare Your Proposal

Beyond verified financials, several free resources can strengthen your proposal before you submit it.

Bizzie's free instant business valuation tool generates a data-backed estimate you can use to calibrate your offer price or stress-test your asking price, giving you a defensible starting point before committing to a number in writing.

The Australian Government's business.gov.au platform offers free guidance on business structures, due diligence checklists, and business transfer resources. These are directly useful when drafting your conditions and contingencies sections.

ASIC's MoneySmart website (moneysmart.gov.au) is a useful starting point for understanding personal finance and borrowing options relevant to a business purchase, helping you assess what payment structure is realistic given your borrowing capacity before your proposal is written.

Finally, engaging a business broker with experience in your target industry can provide comparable sales data, what similar businesses have actually sold for. This real-world transaction evidence is the most defensible foundation for your proposed purchase price.

Final Thoughts: Writing a Proposal That Gets Deals Done

With the right tools in place, the final step is putting it all together.

A well-structured proposal is what separates serious buyers from noise. The seven sections covered in this guide, from your buyer introduction through to timeline and next steps, give sellers and their advisers a clear, professional basis for negotiating. Structure signals credibility; specificity signals commitment.

As covered earlier, proposals built on unverified figures are vulnerable to renegotiation and deal collapse.

Start by identifying a target business, then run a free valuation on Bizzie to anchor your offer to a defensible number. Browse listings with Xero-verified financials to ensure the figures you are proposing against reflect real accounting data. Then apply the seven-section framework to structure a proposal built to close.