Advice for Buying a Restaurant and Selling a Restaurant

Atlanta Restaurant Sales Continue to Climb in 2015

Posted by Eric Gagnon on Jun 2, 2015 1:41:07 PM

CPA Robert Wagner has released his quarterly survey of sales growth in the Atlanta market and the results show an increase over last year of 5.5% versus the same period in 2014.  

A positive first quarter trend was reported by the CPA firm at 71% of the more than 100 restaurants surveyed.  

Q1_2015_Sales

The restaurant brokers are seeing similar trending in the dozens of P&L's reviewed in the past quarter.   Eric Gagnon, President of We Sell Restaurants says, "We are seeing sales increases ranging from 3% on the low end to 6% on the high end for most of the P&L's we review as part of the listing process. That includes both Atlanta Georgia listings and restaurants for sale nationwide."  He continues saying, "Sales are only one part of the equation when valuing a restaurant for lending.  Most valuation is based on earnings and owner benefit rather than top-line sales.  Most restaurant find stronger earnings as a result of better top line sales but others find savings in the bottom line through stronger expense management."  

Restaurant Broker Eric Gagnon's take on sales increases is in line with the results captured by Black Box. Black Box Intelligence, a restaurant sales and traffic-tracking company found results nationwide were almost half that of the Atlanta marketplace with reported sales up 2.8% over the prior year in first quarter. Their data implies that some price increases have been in play as well since they say that while overall sales are up 2.8%, traffic is down .6% compared to the same period in 2014. 

Robert Wagner, NetFinancials president states that, “Q1 2015 was the 17th straight quarter that our
sales survey disclosed positive sales growth at Atlanta restaurants. There were a couple of
offsetting developments in Q1. First, sales in 2015 were going up against a quarter (Q1 2014) with
significant weather challenges. So we expected the 2015 sales to show favorably. Alternatively, in
Q1 new restaurants opened in Atlanta, particularly at Krog Street Market and Buckhead Atlanta. By
definition, new restaurants are not included in our survey. However, they can negatively impact
sales trends at existing restaurants. These competing trends appear to have canceled each other
producing a routine, respectable positive-comp-sales trend of 5.5% for Q1 2015.”

 

About the survey

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The Sample: The 103 independently-operated, non-franchise restaurants were drawn from the metro
Atlanta market. Total survey sales volume was $69 million for the quarter. The survey includes
restaurants in Atlanta’s fast-casual, casual and fine-dining segments opened at least 15 months.

Robert Wagner, CPA is president of NetFinancials, Inc. which provides a full range of tax and
accounting services for restaurant companies. Email: bob.wagner@netfinancials.com.
www.netfinancials.com Direct: 404-874-7002

The NetFinancials quarterly Atlanta restaurant sales survey is provided as a public service to the
restaurant industry. Copyright NetFinancials, Inc.

Topics: Selling a Restaurant