Buying a Food Business

Pearls of buying a food business…

We help with food business sales

When it comes to Business sales, there is no market quite as volatile as the hospitality sector. As a hospitality consultant I have seen it all. From clients paying as much as 95% of total sales on rent alone to others paying ridicules multiples on businesses hardly turning a profit to businesses turning a tidy profit only to be reduced to rubble in no time at all.
Of course, there are other industries with similar outcomes but not nearly as common as in food business sales, I can assure you.
Let’s look at this a little closer. Some industries can have a bad day and they might just have to work late to catch up and the end user is none the wiser. Not possible in the hospitality industry. As the age old saying goes, “You are only as good as your last service.” And never truer than in this era of social media, as you can not only become an overnight success, you can also experience an overnight demise if you manage to come up short with trigger happy socialites just biting at the bit to be the next Matt Preston (MasterChef food critic)

Restaurants can sell for $500,000 plus dollars. Food business sales are based off of takings, hours of operation, complexity, lease, location etc. etc. This same Restaurant not long after, in the wrong hands can have an owner begging someone to take over the lease and willing to offer a Business Broker the entire sum of the sale just to get off of that lease, so they can get their Rental Bank Guarantee back and get out.
If you are considering buying a food business, opening a food business or expanding a Restaurant or Café please beware as the devil is in the detail. There is Gold in them hills but there is also sharks in the waters surrounding them. Feel free to call and discuss as I am certain I can at best save you a tonne of money, at worst, potentially your marriage. Prevention is better than cure.
We help with food business sales, food business appraisals, due diligence on food business purchases or lease negotiations on food businesses, Café’s or Restaurants. If you are considering buying a food business, please call us before you sign any contracts.