As with most businesses, price is a prime factor in selling a restaurant fast. However, restaurants can sell for their asset value alone, such as furniture, fixtures and equipment (FF&E) along with their permits and licenses. Knowing how to value those assets is the key to selling a restaurant quickly. Price is not the only [...]
As with most businesses, price is a prime factor in selling a restaurant fast. However, restaurants can sell for their asset value alone, such as furniture, fixtures and equipment (FF&E) along with their permits and licenses. Knowing how to value those assets is the key to selling a restaurant quickly.
Price is not the only determining factor in procuring a quick sale. You need to get into the “buyer mindset” and make sure a buyer sees the same value in your restaurant as you do. Here are some no nonsense step to getting your restaurant sold fast:
1. Price – Price – Price!!!
Just like anything else… the better the deal, the faster someone will snatch it up. Some factors that go into determining the price are location, FF&E replacement values, permits and licenses.
2. Make it easy to understand -
If you want to sell your restaurant above and beyond the asset value, make sure your books and records are in order. If someone can’t understand your books and records, they generally aren’t going to pay much for your restaurant.
- Put together a list of inventory and other assets such as furniture, fixtures and equipment (FF&E) and list their replacement costs.
- Make sure you have straight forward profit and loss statements for the last three years
- Find a way to prove cash sales (start keeping a handwritten record on the side, if necessary)
- List out your cost of goods sold (COGS)and monthly food waste costs, if possible
- Have any employment contracts organized and ready for review
- List out any debt that will need to be dealt with in the sale
3. Write up your story-
How and why you opened this restaurant, what are the opportunities and the obstacles and why you are selling. Also, list how you advertise to customers. Quote some reviews, etc.
4. Clean it up-
Make sure chairs, tables and décor are in good shape. The kitchen and bathrooms should be spotless and free of clutter and all equipment should be operational. Your staff should be friendly & knowledgeable and the general environment should be pleasant to customers. Also note that messy inventories tend to scare away buyers.
5. Review your lease- (unless you are selling property with the business)
Make note of your expiration date, what extension option you have and any transfer clauses. A buyer will either assume your current lease or negotiate a new one depending on the factors within your lease agreement.
6. Get a restaurant broker-
A good restaurant broker will help you get organized and help you determine the best price to expedite the sale. They will also advertise on the plethora of websites (I, for instance, advertise on at least 100 local, national and international sites dedicated to selling restaurants and businesses). A good restaurant broker will also discreetly market to people within the restaurant industry, help you negotiate the best deal and, most importantly, make sure the deal closes.
There is a lot that goes into selling a restaurant, much more than many other types of business. A restaurant needs be positioned for sale to get it in front of the right buyers. We currently have over 3,000 buyers in our database alone. For a free consultation, please don’t hesitate to call Restaurant Broker, Shelli Margolin-Mayer at (310) 882-2200 ext. 128. http://www.bizex.net/business-broker/shelli-margolin