What You Need to Know About Walk-In/Walk-Out Contracts (WIWO) When Buying a Business
If you’ve been scrolling through commercial listings lately, you’ve likely stumbled across the term “WIWO.” It’s often used as a selling point—a promise of a seamless transition where the keys are handed over, the lights stay on, and business continues without a hitch.
But as with most things in commercial law, the simplicity of the term can be a bit deceptive. Whether you are looking at a boutique café in Mooloolaba or a mechanical workshop in Nambour, understanding the meaning of a WIWO or Walk-In/Walk-Out business sale contract can be the difference between a smooth takeover and a legal headache.
What Does WIWO Mean, Anyway?
In the world of commerce, WIWO means exactly what it sounds like: the buyer “walks in” and the seller “walks out.” Essentially, the business is sold as a total package. When you buy on a Walk-In/Walk-Out basis, you aren’t just buying the name; you are typically acquiring the equipment, the furniture, the existing stock, and the “goodwill” all for a single, all-inclusive price.
For many, what WIWO means in business property or business in general is “convenience.” You don’t have to spend your first week as a new owner counting every individual teaspoon or measuring the remaining oil in a drum to adjust the final price. You agree on a lump sum, and everything currently used to run the business stays right where it is.
The All-Inclusive Price Tag
The hallmark of a Walk-In/Walk-Out contract is the “all-in” price. Unlike a standard REIQ business sale contract, where the price might be “Plus Stock at Valuation” (SAV), a WIWO deal includes the stock in the purchase price.
This can be a double-edged sword. For a buyer, it provides certainty. You know exactly how much cash you need at settlement without worrying about a surprise stock-take invoice on Friday afternoon. However, from a legal and practical perspective, it’s vital to define what “stock” actually looks like at the time of the handover. If the seller has a massive clearance sale the week before settlement, you might walk into a business with empty shelves, despite having paid a premium for a “complete” package.
Why the Meaning of WIWO in Business Property Matters
When we talk about the meaning of WIWO in business property, we are looking at the marriage of the physical space and the operational assets. A WIWO deal usually assumes that the “plant and equipment”—the ovens, the delivery vans, the computers—are in good working order and are included in the price.
As your Walk-In/Walk-Out contract is being drafted, we focus heavily on the “Inclusions List.” If it isn’t written down in the contract, don’t assume it’s staying. We’ve seen cases where buyers thought the bespoke espresso machine was part of the deal, only to find the seller took it home because it was a “personal” item. A seasoned commercial lawyer will ensure every vital piece of equipment is documented to avoid “missing asset” disputes on day one.
The Tax and Accounting Angle
One of the reasons “What does WIWO mean?” is a common question is the way the purchase price is allocated. Even though you are paying one lump sum, that sum needs to be “split” on paper for tax purposes. A portion goes to goodwill, a portion to plant and equipment, and a portion to stock.
This allocation matters because it affects how you claim depreciation and how the seller handles their Capital Gains Tax. It is one of the few areas where a “simple” WIWO deal requires a bit of behind-the-scenes accounting to ensure the buyer and seller are compliant with the ATO.
Protecting Yourself Before You Walk In
While the Walk-In/Walk-Out basis is designed to be simple, the due diligence should be anything but. Because you are often forgoing a formal stock-take at valuation, it is important to perform a thorough inspection of the business assets shortly before settlement.
You want to ensure that the “goodwill” you are buying is actually there—that the licenses are current, the lease is secure, and the equipment is unencumbered (meaning no one else has a legal claim to it). Using a standard business sale contract as a base is common, but it often requires specific special conditions to truly capture the nuances of a WIWO arrangement.
Final Thoughts
A WIWO sale is a fantastic way to hit the ground running, especially for first-time business owners on the Sunshine Coast who want to avoid the granular stress of a traditional asset split. However, “all-inclusive” should never mean “unprotected.”
At Bradley & Bray, we make it our business to ensure that when the seller walks out, you are walking into exactly what you paid for. If you’re eyeing off a new venture (even if it’s an online business) and the listing says “WIWO,” reach out to our commercial law team. We’ll help you look under the hood and make sure the contract is as solid as the business you’re about to lead.
Disclaimer: This article is general in nature and does not constitute legal advice. If you require legal advice in relation to your personal circumstances, you must formally engage our firm, or another firm to provide legal advice in relation to your matter. Bradley & Bray lawyers take no responsibility for any use of the information provided in this article.
