Types of Commercial Due Diligence
Red-flag, full, top-up, vendor. Cost and timeline comparator across the four UK CDD types.
Four CDD types matter in UK mid-market practice: red-flag (£15-25k, 2-3 wk), full (£25-50k, 3-5 wk), top-up (off a vendor VCDD, £10-25k) and vendor CDD (sell-side, £30-60k). Choice is driven by deal stage, sponsor tolerance for risk and the presence or absence of a credible VCDD.
§ 1.1Red-flag CDD
Scope: top three chapters (market, customer, risk). Used when the sponsor wants a fast no-go signal before committing to a full mandate. See /types/red-flag/.
§ 1.2Full CDD
All seven chapters of the spine; the default sponsor commission on a competitive process. See /types/full/.
§ 1.3Top-up CDD
Commissioned off a vendor VCDD; covers incremental work the buyer cannot rely on the seller’s adviser for. See /types/top-up/.
§ 1.4Vendor CDD (VCDD)
Sell-side commissioned, with a reliance letter offered to shortlisted bidders. See /types/vendor-vcdd/.
§ 1.5Comparator
| Type | Scope | Fee | Timeline |
|---|---|---|---|
| Red-flag | Top 3 chapters | £15-25k | 2-3 wk |
| Full | All 7 chapters | £25-50k | 3-5 wk |
| Top-up | Incremental off VCDD | £10-25k | 2-4 wk |
| Vendor | Sell-side full | £30-60k | 4-8 wk |