Selling a restaurant can be a complex process, but with the right approach, you can maximise your chances of a successful sale. This guide will walk you through the essential steps and provide valuable tips on how to sell a restaurant effectively.
If you own a FREEHOLD building for a restaurant and wish to sell it quickly, we’ll buy it for cash. Please note that we can’t purchase the restaurant’s lease.
Numerous reasons can force you to sell your restaurant, takeaway, or café. These include (but are not limited to):
- Retirement or ill health
- A death of a spouse
- Financial difficulties as business may no longer be viable.
We recognise that running a restaurant, a café, or a fast-food takeaway is demanding because it requires you, the owner, to put in a lot of hours and consistently produce high-quality food to have a repeat business. It was the food business owners that kept the morale of the nation up during the lockdown.
Naturally, you are probably feeling let down by high energy costs, inflation on raw food prices and no respite from increasing business rates. You are not alone. We are here to help you make a fresh start and support you through this difficult period.
In this article, we’ll discuss how you can sell any restaurant, café or takeaway using three methods of sale.
Table of Contents
Preparing your restaurant for sale
If you want to sell your restaurant at a high price, consider its performance and find ways to increase profits or cut spending. Make sure you have a plan in place for a smooth sale. To boost the value without spending too much, focus on the restaurant’s presentation and cleanliness.
Also, establish systems that allow the business to operate without relying heavily on the owner. Trust your floor manager or chef with more responsibilities.
Organise Your Financials
Potential buyers will want to see clear, accurate financial records. Gather at least three years of:
- Profit and loss statements
- Tax returns
- Balance sheets
- Cash flow statements
Ensure these documents are up-to-date and easily understandable. If your books are messy, consider hiring an accountant to tidy them up.
Spruce Up Your Restaurant
First impressions matter. Take a critical look at your restaurant through a buyer’s eyes:
- Repaint where necessary
- Deep clean all areas, including kitchen equipment
- Fix any broken fixtures or fittings
- Update decor if it looks dated
These improvements can make your restaurant more attractive to potential buyers and potentially increase its value.
Streamline Operations
Buyers are often looking for a turnkey operation. Create or update:
- Employee handbooks
- Training manuals
- Standard operating procedures
Having these in place shows that your restaurant can run smoothly without your constant presence.
Valuing Your Restaurant
Determining the right asking price is key to selling your restaurant. There are several methods to value a restaurant:
- Multiple of earnings: Typically 2-3 times annual cash flow
- Asset-based: Sum of all tangible assets plus goodwill
- Revenue-based: Usually 25-35% of annual revenue
Consider getting a professional valuation to ensure you’re pricing your restaurant correctly.
Finding Buyers
Once your restaurant is ready for sale, it’s time to find potential buyers. Here are some effective strategies:
- List on business-for-sale websites
- Advertise in industry publications
- Network within the restaurant community
- Use social media to spread the word
- Consider hiring a business broker specialised in restaurant sales
Remember, confidentiality is key. You don’t want to alarm your staff or customers prematurely.
Negotiating the Sale
When you receive offers, be prepared to negotiate. Key points to consider include:
- Purchase price
- Payment terms
- Transition period
- Non-compete agreements
- Inventory and equipment included in the sale
Don’t be afraid to walk away if the terms aren’t right. It’s better to wait for the right deal than to accept a poor offer.
Closing the Deal
Once you’ve agreed on terms, you’ll need to:
- Draft and review the sales agreement
- Complete due diligence
- Transfer licenses and permits
- Finalise the handover process
Consider hiring a solicitor experienced in business sales to guide you through this process.
Tips for a Successful Sale
- Be honest about your restaurant’s strengths and weaknesses
- Keep the business running smoothly during the sale process
- Be patient – selling a restaurant can take time
- Stay flexible and open to negotiation
- Maintain confidentiality throughout the process
How To Sell A Restaurant?
Whether you are looking to sell a fast-food business or any eatery, selling via a business broker is best. They will put a value on your restaurant based on the goodwill of repeat customers and profits over the last 3 years.
It may be much harder to value a business operated as a ‘cash only’ payment method such as a takeaway.
Unfortunately, due to the cost of living crisis, it has become difficult to start up a business, particularly as disposable incomes have fallen. You may have tried a business broker to sell your business without success.
We would be interested in buying if you own the property as a freehold or a virtual leasehold and wish to sell it. Property Saviour are cash buyers for commercial property.
We can buy your restaurant for cash; however, closing down a business overnight doesn’t work well in practical terms for owners.
If you opt for a planned closure and sale of the business, this can create several benefits, including a mutually agreed price higher than a cash offer, allowing you time to sell equipment, fixtures, and fittings – and for your staff to find new jobs.
Where Do You Sell Fast Food Restaurant?
Property Saviour offers you a real alternative to selling your commercial property. If you are thinking of auctioning your commercial property, you would have to put in a very low guide price in order to attract bids. There’s no guarantee that your property will sell because of uncertainty in the property market.
There’s a stigma with auction properties as it is widely expected that there’s something wrong with the property. With upfront fees and waiting for up to two months for the sale to conclude, auctions aren’t not for everyone.
If your property is put on the market with a commercial property agent, these are some of the challenges that you are likely to face:
- There are fewer buyers who understand commercial property and can afford to pay a 40% deposit.
- Commercial property agents charge upfront marketing fees.
- The huge for-sale board can upset your tenants or introduce doubt in the minds of customers who have booked your venue for their weddings, birthday celebrations or Christmas parties.
- You are tied into a contract for up to one year.
- If you decide to serve notice to end the contract, you will notice increased enquiries and offers. These are trade secrets of commercial agents to buy time – hoping that a real buyer turns up.
Even if a legitimate buyer is found, they will likely struggle to obtain a commercial mortgage because of expensive interest rates of 9-10% per year. This means that running a restaurant may not be financially viable.
*Correct at the time of writing 4th October 2024.
How To Sell Any Restaurant With Certainty?
If you wondering ‘how can I sell my commercial property fast‘ you can be assured that with Property Saviour, you are in safe hands. Here’s why:
- No endless viewings – just one.
- No frustration or abortive solicitors’ fees.
- There are no commercial agency fees to pay.
- Sell any commercial building – takeaway, café or restaurant.
- We will pay up to £1,500 towards your legal costs.
- Regular communication until completion.
We’ll buy all types of commercial property, so get in touch if you’d like to sell your commercial building fast.
We are commercial property experts trusted by sellers like you, so please do get in touch with us.
Sell with certainty & speed
Property Saviour Price Promise
- The price we’ll offer is the price that you will receive with no hidden deductions.
- Be careful with ‘cash buyers’ who require a valuation needed for a mortgage or bridging loan.
- These valuations or surveys result in delays and price reductions later on.
- We are cash buyers. There are no surveys.
- We always provide proof of funds with every formal offer issued.
We'll Pay £1,500 Towards Your Legal Fees
- No long exclusivity agreement to sign because we are the buyers.
- You are welcome to use your own solicitor.
- If you don’t have one, we can ask our solicitors for recommendations.
- We share our solicitor’s details and issue a Memorandum of Sale.
Sell With Certainty & Speed
- Our approach is transparent and ethical, which is why sellers trust us.
- 100% Discretion guaranteed.
- If you have another buyer, you can put us in a contracts race to see who completes first.
- Complete in 10 days or at a timescale that works for you. You are in control.
