Selling Your Restaurant
What you should know about selling your Restaurant
What is it the Broker does? Restaurant Brokers are the professionals who can facilitate the successful sale of your business and or real estate. As your business broker we can help you decide how to price your business and how to structure its sale so it makes sense for both you and the buyer. We will also help facilitate all details of the business buying process such as licensing and UCC compliance. It is important to understand that only the marketplace can determine what a business will sell for. Most businesses are saleable if priced and structured properly. Often the amount of the down payment you are willing to accept along with the terms of seller financing can greatly influence not only the ultimate selling price, but also the success of the sale itself.
Market Valuation As experts in the Food & Beverage Industry, we can advise you as to the Fair Market Value of your business. All market valuations are based upon current market activity and actual sales and transaction data.
Marketing of your Listing Our comprehensive marketing program reaches more prospective buyers than any firm in the industry. We utilize state of the art technology to find, screen and maintain a huge network of prospective buyers and tenants. We make every effort to sell a restaurant quickly, quietly and professionally. It is important to us to make sure that employees, customers, vendors and others are not aware of the fact that the restaurant is for sale.
How long will it take to sell my Restaurant? It generally takes, on average, from three to eight months to sell most restaurants. Keep in mind that an average is just that, some restaurants will take longer to sell; while others will sell in a shorter period of time. The sooner we have all the information needed to begin the marketing process the shorter this time period should be. It is also important that the business be priced properly from the start. Some sellers, operating under the premise that they can always come down in price, overprice their business. This theory often backfires, because often buyers will refuse to even look at an overprice business. It has been shown that the amount of the down payment may be the key ingredient to a quick sale. Often the lower the down payment, (generally 50 percent of the asking price or so) the shorter the time to a successful sale.
Documentation We will generate a comprehensive marketing package. Our typical package includes: a listing information cut-sheet, photographs, demographics, Financial Statements and the Lease. It is important that you help us collect this information in a timely manner. A buyer will want up-to-date financial information. If you use an accountant or bookkeeping firm, you can work with them on making current information available.
Is seller financing important to the sale of my business? About 45 percent of all transactions contain some form of seller financing. Surveys have shown that a seller, who asks for all cash, receives on average only 70 percent of their asking price, while sellers who accept terms receive on average 86 percent of the asking price. That 16 percent can be a substantial difference. In many cases, businesses that are listed for all cash just don’t sell. With reasonable terms, however, the chance of selling increases dramatically and the time period from listing to sale decreases greatly.
Screening of Buyers Buyers are interviewed and screened for both their financial strength and operational experience. We make every effort to ensure you are not dealing with an unqualified buyer.
Showings Showings will be scheduled with confidentiality being the priority. We will coordinate with you to scheduled times that will not interfere with the operation of your business. Morning hours are typically preferred.
What happens when a buyer wants to make an offer? When a buyer is sufficiently interested in your listing, we will help in the preparation of an offer. This offer or proposal may have one or more contingencies. Usually, they concern a detailed review of your financial records and may also include a review of your lease arrangements or other pertinent details of the business. The buyer’s proposal will be presented to you for your consideration. You may accept the terms of the offer or you may make a counter-proposal. You should understand however, that if you do not accept the buyer’s proposal the buyer can withdraw it at any time. We will submit all offers for your consideration. At first review, you may not be pleased with a particular offer; however, it is important to look at it carefully. It may be lacking in some areas, but it may also have some benefits to seriously consider. When you and the buyer are in agreement, we will work with both of you to satisfy and remove the contingencies in the offer. It is important that you cooperate fully in this process in order to avoid losing the buyer. The buyer may, at this point, bring in outside advisors to help them review the information.
Closing When all the conditions have been met, the final papers will be drawn and signed. Once the closing has been completed, money will be distributed and the new owner will take possession of the business. As your Broker, we will work with you throughout the entire sales process to drive the transaction to an orderly close. We do not receive payment until the transaction is complete.