Every NDIS provider depends on participants choosing to continue using its services. When a large share of revenue sits with a small group — or arrives through a single referral source — the business carries more risk than its headline revenue suggests. Assessing that risk lawfully and respectfully is a core part of buyer due diligence.
This article is general information only. It is not legal, privacy or financial advice.
Participants are not assets
Participants choose and can change their providers. A sale does not transfer participants, and no one can guarantee they will stay. Buyers should assess the pattern of revenue, not the individuals behind it. The OAIC's guidance on selling a business supports using de-identified or aggregated information during due diligence.
What to measure
Assess Risk Before You Commit
Our free buyer due diligence checklist covers anonymised revenue distribution, referral sources and participant continuity.
Ask for anonymised data that separates four things:
- Revenue concentration — the share of revenue from the largest participant groups, shown in bands (for example largest 1, largest 5, largest 10)
- Margin concentration — some high-revenue services carry thin margins; losing them affects profit differently from revenue
- Service mix — reliance on one support type, such as a single supported living arrangement
- Referral sources — how new participants have arrived, grouped by source type (support coordinators, plan managers, allied health, self-referral) rather than by named individual
A hypothetical concentration example
The figures are invented for illustration. They are not a prediction for any real business.
A business has annual revenue of A$1,200,000. Its largest anonymised participant group accounts for A$510,000 — that is 42.5% of revenue.
| Scenario | Revenue change (A$) | Revenue after (A$) |
|---|---|---|
| Group continues unchanged | 0 | 1,200,000 |
| Half the group's services change provider | −255,000 | 945,000 |
| The whole group changes provider | −510,000 | 690,000 |
These are scenarios to test resilience — can the business still cover wages, rent and compliance costs in each case? They are not forecasts of what participants will do.
Referral concentration
A business that receives most new participants through one support coordination organisation may see growth slow if that relationship changes. Where a support coordinator also has a connection to the provider, the NDIS Practice Standards specialist support coordination module sets out choice, control and conflict-of-interest expectations for providers to whom that module applies. Do not assume the same obligations apply to every provider, but do ask how referral relationships are managed and disclosed. For support coordination businesses specifically, see what to check before buying a support coordination business.
Continuity after a sale
The NDIS Commission's guidance on buying or selling a registered NDIS business emphasises continuity of supports for participants. Practical indicators a buyer can review include:
- Staff tenure in roles that deliver regular supports
- Whether service agreements are current
- De-identified complaint and incident trends
- The seller's plan for communicating with participants, respecting their choice
Questions to ask the seller
- What share of revenue came from the largest 1, 5 and 10 anonymised participant groups in each of the last two years?
- Has that share been rising or falling, and why?
- What margin does each major service type earn after direct wages?
- How many new participants arrived in the last 12 months, grouped by referral source type?
- Are any referral relationships connected to the owner personally, and how are conflicts disclosed?
- What would happen to rostering and fixed costs if the largest group changed provider?
Ask for the answers as summary tables prepared by the seller or their accountant. You should not need names, NDIS numbers or plan details to assess concentration.
How concentration affects value
Higher concentration generally means higher risk, which buyers reflect in price, structure or both — for example through deferred payments linked to performance. Read how to value an NDIS business before selling and our guide to normalised EBITDA for how earnings and risk combine.
Our free buyer due diligence checklist includes concentration, referral and continuity checks. You can also browse NDIS support coordination businesses for sale.
