Vendor due diligence (VDD) is a comprehensive review of the target business commissioned by the seller, typically by an accounting or law firm, before going to market. VDD is intended to surface and address issues before buyers do, accelerate the transaction timeline, and increase competitive tension by giving multiple buyers credible third-party diligence at the start.
In Australian sub-$20M deals, VDD typically costs $40,000 to $120,000 and is most common in auction processes or where the seller is anticipating multiple buyers.