4 Tips to Get Top Dollar When Selling Your Restaurant, Bar, or Nightclub

4 Tips to Get Top Dollar When Selling Your Restaurant, Bar, or Nightclub

4 Tips to Get Top Dollar When Selling Your Restaurant, Bar, or Nightclub 2560 1707 Prakas & Co

Here at Prakas & Co we’ve brokered the sale of over 500 restaurants in the last 21 years. Having represented a wide range of clients from small coffee shops to world renowned steakhouses, we’ve pinpointed four ways of getting the highest value for your restaurant.

1. Report ALL Sales – Including CASH!
Good record keeping is absolutely critical to being able to sell your business for top dollar. Generally the first thing prospective buyers look at is how much an operating restaurant or bar is profiting. When looking at a balance sheet, savvy business buyers are often able to discern things like owner compensation and business vehicles, however income that is not reported is very difficult to account for, especially when working with buyers who represent larger restaurant groups and those seeking institutional funding.

2. Negotiate a Favorable Long Term Lease
Business valuations are based on the amount of money that the buyer is able to make from your restaurant or bar which is often a multiple of your yearly profit. With that said, the #1 reason we see deals turned down is because there isn’t enough time remaining on the lease. The fact of the matter is, if your business is on year 13 of a 15 year lease without any option to extend it, there is less than two years of potential income remaining for any prospective buyer. This drastically devalues your sales price, and at times can make a sale impossible altogether. We strongly recommend negotiating long term leases with extension options upfront, however it’s often possible to renegotiate your lease and request options even as it is coming to an end.

3. Well Maintained Restaurants are More Valuable
In the same way that your houses curb appeal helps to drive top dollar for your home, how well a restaurant is maintained helps drive to dollar for your restaurant. While it might be a given, keeping both your front of house and back house equipment in pristine condition and performing regular cleaning is crucial to maximizing your sale price. We recommend having your kitchen equipment serviced on a regular basis as well as promptly repairing anything that breaks, especially things that face customers directly like ripped booths or wobbly tables.

4. Hire a Business Broker You Trust
Having been in the industry for 40+ years and operating our own brokerage for 21 of those, we’ve heard countless horror stories about operators finding themselves in trouble when a sale goes wrong. Restaurant brokers like Prakas & Co are here to ensure that your restaurant sale goes as smoothly as possible and we have the resources to get you top dollar for your business. A great deal of our time is spent creating a professional marketing package and utilizing our contacts to ensure that it gets widespread national exposure. We offer risk free valuations for restaurants, bar, and nightclubs in Florida, and our agents are excited to provide in depth analysis on the restaurant market.

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