Selling Your Cafe or Restaurant

Business Tips – Selling Your Cafe or Restaurant

Websites are populated with food businesses these days, that owners want to sell for a myriad of reasons.  Some of them are being sold at a price that barely covers the fit out cost or replacement value of the plant and equipment. If you plan for the sale of your café or restaurant, it is possible to make a profit for the investment you have made both in cash and time. An important part of running a business is knowing when the time is right for a sale and what you need to have in place when that time is upon you.

Have A Plan To Exit

If you are thinking of selling your café or restaurant in six months, then you need to have that plan in place prior to now.  The biggest mistake people make is with timing. You have to have an exit strategy in place prior to signing the lease.  If you think you can decide to sell and get it done quickly, you will not be maximising your price. The lease is critical in the process, the security of tenure will have a huge impact on your price and the sale-ability of your café or restaurant. For a start-up, the owner makes an investment through fit out and establishment costs.  This must be followed by a period of growth during which the owner can earn an income. Owners also need to remember that the incoming purchasers will want to earn a return on their investment.  If the lease does not allow time for them to earn a return, the purchase will be unattractive to the potential purchaser. It’s a numbers game. Finding the right balance between the purchase price, the length of lease and the multiple of annual profit is vital. If you need help with selling your café or restaurant, contact me today and let’s have a chat.

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