How To Sell a Restaurant: A Comprehensive Guide

So, you want to know how to sell your restaurant. Either because you want to retire to your own tiki hut in Bora Bora, or it's unfortunately going under and you just want to cut your losses. Here are a few simple steps you could follow to make the transition from restaurant-owning to restaurant-free.

Assess What You Have

• Market Value

Of course you want to earn from this sale, who doesn't? But you have to get real about things. Before fixing on a price that YOU think the business warrants, find out the prevailing selling price of other restaurant businesses in your area. If you price it too high, no one may make an offer and you'll be stuck with a business you no longer want.

• Physical Condition

Take a good look at your restaurant. Are the chairs and tables so worn they need to be put to sleep? Is the wallpaper faded and old enough to vote? Has your kitchen become a health, as well as a fire hazard? Or are they all as pristine as the day you opened your doors to the hungry public? It would be best if you do some minor repairs and give everything a good scrubbing. It would not only up its appeal, but would also incite a well-needed confidence in the business.

• Financial Condition

Is the business thriving? Or is it sinking? A thriving business could command a good price. (after all, the buyer is getting an earning business.) If it is in the red, then you might just have to compromise and agree on a much lower price. This is also another chance for you to think things through; do you really want to sell?

Prepare the Paper Work

Update your different licenses and permits. Are they about to expire? Can these licenses and permits be transferred to another person? It is better to take note of these things now rather than compromise the sale simply because you forgot to take care of such things.

Create a Business Package

A business package is simply an overview of your business. This includes the name, place, years of operation, financial statements (annual income, net profit, itemized costs - lease, utilities, permits), list of equipment, furniture, appliances included in the sale. This is a great tool to get both parties on the same page on what are and are not included in the sale.

Get the Word Out

People should know that your restaurant is up for sale! Advertise in all possible channels - newspapers, online classifieds, and specific classified sites for selling businesses. The farther your reach, the more potential buyers you can attract.

Screen Potential Buyers

Are these potential buyers willing and able to buy and run your restaurant? Avoid selling to con artists or buyers who don't have the means to pay you. Have them fill out a buyer disclosure form you've created and be diligent in checking out their references. When it seems that they are who they say they are, then and only then do you hand over a copy of the business package.

Have Everything In Writing

Unless you are a lawyer yourself, it's best to hire legal counsel when it comes to the final sale. Lawyers would put down every agreement on paper and make sure all your legal paperwork is in proper order.