If you want to sell a restaurant for peak market value then proper preparation is the key. The following 3 items need to be prepared early, so you can sell your restaurant business faster.
1) Evaluate your Restaurant’s Appearance
First impressions are powerful. If a potential buyer pulled up to your business today, how does it look? Is the exterior clean and free of trash? Are all the lights working or does the “o” in “Joe’s café” need to be replaced? And what about the interior? Little adjustments like changing out dirty ceiling tiles or giving the kitchen and bathrooms a deep clean can be the difference between getting an offer or having the buyer walk out the door.
2) Prepare a Profit & Loss Statement
Every serious buyer will ask to see your P&L, so it’s best to get this in order immediately. The profit and loss is designed to decrease your tax liability. Buyers will pay for what your books show, so if you can’t show the sales you claim then they simply don’t exist. If you are writing off personal items such as cell phones, family dinners, travel, insurance, etc., then you must be transparent with the buyer. The money used for these personal items are actually considered cash flow, that needs to be explained and broken down for the buyer.
3) Compile an Equipment List
This is a very important step when learning how to sell a restaurant, because a buyer will lose interest fast if they don’t have this immediately. The buyer always wants to know what they are buying and every little thing that is included in the sale. That’s why it’s important to make a detailed list of every item that you plan to include. If believe you have 34 chairs then count them to make sure and write out “34 chairs.” Guessing a number that winds up being inaccurate or getting rid of any equipment after a buyer puts in an offer is a sure fire way to scare a buyer off completely.
4) Determine a Listing Price
The next step in how to sell a restaurant is figuring out what your restaurant is worth. There are many factors to take into consideration when deciding the market value of your restaurant. Of course most owners want to get back every dollar they invested into the business; however, without strong gross sales and cash flow this is not realistic. As the owner, it can be hard to be realistic regarding the value because of the emotional attachment to the business. For this reason, it helps to have a professional restaurant broker give an expert evaluation.