Tips for Selling a Business – Prepare Your Restaurant for Sale
Selling a business, such as a restaurant, requires planning and preparation. We briefly look at some steps you can take to increase your chances of a higher selling price and seamless sale process.
Appearance Is Important
Even though you, as the restaurant owner, already know the importance of appearance when it comes to customer experience, when selling a business, it is even more important. Yes, the financial statements are essential, but with a restaurant being about food, experience, hygiene, and appearance, how you present the premises is important. It must be squeaky clean, including the parking area, garden, stores, and even the dustbin area.
Repair broken tiles, taps, and any equipment before you show the business to potential buyers. The potential buyers look at what is right in front of them. Dirty walls, worn carpets, dull-looking tiles, greasy surfaces, and the likes portray a message of not caring. The process thus starts by cleaning, repairing, and preparing it to be shown to potential buyers.
Where needed, add a fresh coat of paint and upholster a worn seat or two. Even if you don’t want to spend a whole lot of money on selling a business, improving the appearance is important when it comes to a restaurant or pub.
Remove Personal or Non-Business-Related Items
Before you draft the assets list, remove personal items from the premises. It helps to reduce the chances of misunderstandings. When the broker or potential buyer views the premises, it must be easy to compare the items with the information from the assets list. If it doesn’t form part of the business, it should not be on the premises. This includes computers, sound or catering equipment, clothing, vehicles, and gas bottles.
Appearance Is Perfect – Now for Financial Order
Presenting the restaurant as neat is a good start, but for a true and accurate valuation, there must be accurate financial statements in place. To this end, make sure that you have more than till-slips all stapled together as cash-up records. Hopefully, you have applied good bookkeeping practices since the start of the restaurant. If not, it is not too late to start. Have an accountant help make sense of your books by preparing financial records dating back to at least one year before the selling date. If your restaurant is still within the first 12 months of operation, this should be easier.
List of Assets
Selling a business also entails having a list of items included in the sale. To this end, prepare a detailed list of all the hard assets, such as the bar counter, shelves, chairs, tables, equipment, and appliances. Make a copy of the current lease for inspection by the broker or buyer during the due diligence phase. Also, make sure that you have all the relevant licences in place. Have the employee payroll information ready, in addition to the list of suppliers, as well as all monthly accounts payable, such as insurance, utilities, and security.
To avoid pitfalls and ensure a good market-related price and a seamless sale process, call us for professional help in selling a business anywhere in South Africa.