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HOW TO BUY A RESTAURANT

If you have spent many hours looking for ads of restaurants, it is possible to come to the conclusion that restaurants sold more often than any other type of business. Is it good or bad?

The optimist in this case determines that the market offers a wide variety.

Pessimists think, why is everyone selling their restaurants, and will look at this some kind of trick. And each in its own way will be right. Good restaurants, as well as any profitable business, bought quickly. There are several important points that you must know to a restaurant that you buy or rent, brought profit.

Location.

 
Every restaurant has its own history or current reputation, but still its location plays the most important role. Restaurant visitors can be increased due to the proximity to offices and business centers, a cinema, a shopping center. Location plays a most important role in profitability.


Rent.

 
As you know, every restaurant has its owner, with whom, as a rule, is a lease. But the possibility of a situation, when it signed a lease between the owner and the tenant. At the same time another person can also rent a second time the same restaurant on the rights of the sublease. In this case, the restaurant will have a new tenant, the landlord and the owner. More and more landlords are much more cautious and careful, passing the restaurant for rent to another person. There have been cases, even just refuse to rent to those who have no experience in the restaurant business. The landlords may require that the former owner remained for some time with one of the managers.

When it comes to the terms and conditions of the contract, it is best to enter into long-term contract with the right to revise the accepted conditions. Do not enter into a contract in less than five years.

Evaluation of restaurant for sale.

There are two main methods of assessment of the restaurant:

1) assessment, which is determined by the assets and property of the restaurant; 2) assessment based on monetary indicators of money turnovers. Valuation based on the amount of assets and the amount of property more applicable to non-profit restaurant, or restaurants, located in sparsely populated areas. In this case, you simply buy the equipment and premises from the owner. Rationally make an assessment of equipment and make an offer for the sale of the restaurant. For the restaurant, located in a public place, you need an accurate assessment of profitability. You can take into account the total income of the restaurant, tips, spoilage and property, and other expenses. To determine the real profit. Restaurants with full-service provide double and even triple the profit to the owner. Self-service restaurant - a double profit. In assessing the restaurant also take into account the hours of operation. For example, the owner of a restaurant located in a crowded place, working five days a week for breakfast and lunch, and receives $ 100,000 per year. Another restaurant is open seven days a week and serving customers during breakfast, lunch and dinner, provides $ 120,000 per year to the owner. The first restaurant is profitable, is it not? This long-standing rule that is used to evaluate a restaurant based on the number of working days in a week the restaurant. Of course, this figure is by no means ideal, but the overall picture becomes clearer. It should be keep in mind that the evaluation of the enterprise - this is more of an art than a science. So ... Restaurant, working 5 days a week, giving 70% of total annual revenue. Restaurant, working 6 days a week, giving 60% of total annual revenue. The restaurant, open 7 days a week, giving 50% of total annual revenue.

Informal income.

Now, despite the crisis, the restaurant business continues to evolve, and in this kind of activity, as well as any other, there is a parts of the proceeds that are not registered. The seller wants to sell his business, given its total revenue, which he sometimes can not prove. I always thought this way: if the seller-owner can't prove to you the hidden income, you do not have to pay for them. Moreover, it should not receive a double benefit: he cheated the state for years, evading taxes, and had on this benefit; and now he wants to sell the restaurant to include the value of the revenue it did not register. Restore financial picture with informal income can be based on supplier invoices, personal records of the seller, the salary of staff and so on. On. But all these responsibilities lie on the shoulders of the seller. You should ask the seller only three questions: Can you prove the existence of specific amounts? How are you going to do? Would you like to prove their hidden income?

 
Costs, expenses.

 
Labor costs and expenses for the purchase of basic products considered to be expenses in the restaurant business. These costs will vary depending on the type of restaurant: whether it is a restaurant with a full-service, or fast food. If it's a restaurant full-service (full-service), the high percentage of costs go to the alcoholic beverages. Perform calculations in advance. There is a general rule. Total expenditure - including remuneration, purchase of food, rent payments - should not exceed 65% of the total gross income. If you violate this rule, you run the risk of working at a loss, which can lead to the closing of the doors of your restaurant. It is believed that the typical distribution costs shall be as follows: for food costs - 32-33%; salaries - 22-25%; Rent - 6-10%. Ideally, after the addition of these three components, the resulting amount must not exceed 64-65%.

Auditing.

Conducting of financial and legal due diligence of the restaurant - it is a complex event. Time is usually small, and the need to check many things. You'll encounter more than 125 items that will need to check and investigate. Include a list of everything you will need to make and carry out checks on their list. Give yourself enough time at this stage, when buying a restaurant.

The rest of the points.

 
As long as you are not an expert of the restaurant business, contact a professional to assess the equipment. In many large cities, you can consult a professional in this specialty store catering equipment. This is a positive side - you can sell or even change b / Equipment, as today there is a large enough market of such equipment, second-hand, at low prices. Standards Department of Health and other government services form the major part of the inspection equipment and the general condition of the restaurant. Check the archives, there was no previous violations, and include the sales contract item that was not committed sanitary and other violations, which could lead to fines or closure of the restaurant. Everyone knows people will dine only in a clean room, so give it due attention. If earlier there were violations, we can ensure that the public is aware of it. Faster way to burn in this business than to see in a local newspaper article that your institution is infected with insects or does not comply with safety and health, no.

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