Selling a restaurant, especially one currently in operation is a complex project, but preparing to sell the restaurant can be relatively straightforward for the owner. Below are five essential steps every owner needs to take before and during the sales process to ensure they get the very best price for their restaurant.
Focus on curb appeal
Before putting the restaurant on the market, make sure that anyone who passes by or walks in is impressed with the cleanliness and upkeep. If you have any grass or landscaping elements on your property, make sure they’re trimmed and kept clean of debris. Consider filling out any flower beds or shrubbery and removing any plants that seem to be struggling.
Keep trash and debris out of sight of the entrance, and consider brightening up the entrance with appropriate decorations and perhaps a new coat of paint. Pay particular attention to your signage as well. Even if the new owners change the name and take the sign down, a clean and brightly lit sign in good repair adds to the perceived value of the restaurant they’re considering purchasing.
Organize your financials
According to professional business owners, one of the most common reasons businesses – including restaurants – fail to sell or sell for less than they’re worth is because the owners’ financial records are inaccurate, incomplete, or poorly maintained. While you may be perfectly fine keeping track of your bills on a spreadsheet and paying your employees with cash out of the register, a prospective buyer is going to want to see detailed, confirmable figures, preferably in standardized formats like a balance sheet and profit and loss statement.
So, be sure to formalize your financials at least 6-9 months before putting the restaurant up for sale and be fanatical about documenting every single penny that comes in and goes out.
Keep the legalities up to snuff
Another important factor that most prospective buyers will be concerned about when considering your restaurant is the current state of the lease, the appropriate permits on the property and equipment, the liquor license (if appropriate) and the results most recent health inspections.
They want to make sure that what they’re purchasing is in good working order and won’t require immediate expense when it’s time for them to reopen. Or, if spending is going to be required, they want to be able to figure the cost into the sale.
Organized records are again the key here, along with preplanning to ensure that inspections are done on a timely basis, and any recertification or permit renewals are handled on schedule.
Marketing for the right buyer
Once you’re ready to put the restaurant on the market, unless you have a buyer already lined up who’s likely to follow through, your best bet is to list the restaurant through an experienced business broker. You could also use a listing service like BusinessesforSale.com, or combine the two methods.
The point is that simply handing a “for sale” sign in the window is unlikely to attract the right buyer within a reasonable amount of time. Tapping into the depth of experience and connections that a professional business broker or listing service can offer can make all the difference.
Negotiating like a pro
As is necessary for the sale of any business, selling your restaurant is going to end up with some form of negotiation. An experienced business broker can be invaluable during negotiations, but you’ll need to do your part as well.
Your part, in this case, is providing all necessary information when the buyer requests it, getting your ego and personal feelings out of the way, and keeping the proceedings professional and friendly. While everyone realizes you’ve invested your blood, sweat, and tears in this establishment for years, the prospective buyer is merely purchasing property along with whatever brand equity it does or does not possess. They’re going to be dispassionate about the purchase, and you’ll need to be, too.
That doesn’t mean, of course, that you give the restaurant away. With all your previous bases covered, you’re in line to get top dollar for your business, and that’s what you should expect. With an experienced broker in your corner and the optimal marketing options at work, that’s exactly what you’ll get.