Advice for Buying a Restaurant and Selling a Restaurant

A Day in the Life of a Restaurant Broker...What are they doing anyway?

Posted by Robin Gagnon on Jun 15, 2017 9:35:04 AM

50032-Dominique_2011_cropped_for_website_1.jpgHave you ever wondered what your restaurant broker is actually doing every day? Here's a day in the life of Restaurant Broker Dominique Maddox who shared these thoughts.

Dominique recently had a conversation with his wife telling her how mentally tired he was after a tough day as a Certified Restaurant Broker when she returned from work. His wife said, “You sit in front of your computer all day, what did you actually do today?" Here's his log of his actions for the day he was kind enough to share.  

5:00 am – Wake up and put on the 1st pot of coffee. Review my business to-do list for the day and add items

5:30 am-  Go to the gym and go beast mode to get ready for the day

7:30 am – On the road to take pictures of a restaurant I recently listed for sale. I must arrive before the back of the house staff arrives so they will not be suspicious.

8:45 am- After battling through the high-dense Atlanta traffic, I make it to my destination 42 miles from my home.

9:15 am- Pictures are finished and I must conduct a conference call between a buyer and seller to discuss expenses on last year’s profit and loss statement while sitting in my car. 

9:40 am-  While still sitting in my car, I get a call from a seller he is not happy. The seller does not want to sign the 4506-T form which allows the bank to request the sellers tax returns for a buyer to get an SBA Loan based on the business financials. The seller discloses to me they need to amend their tax returns because they filed inaccurate numbers.

9:50 am – Receive call from leasing representative the landlord will not offer my client more Tenant Improvement Money to move forward with the lease. The landlord will only offer 2 free months of rent instead of 3 months.

11:00 am – Arrive back at home office to respond back to missed emails and calls.

11:25 am – Review my HOT Report and touch all my pending deals with updates or reminders

11:45 am – Receive call from a financially qualified candidate. Buyer needs help understanding the price valuation of the restaurant. Buyer does not understand the definition of add-backs for a price valuation.

12:00 pm- Receive email from buyer that request to see a lease space I’m advertising. I call the buyer and they don’t want to show proof of funds, business plan, or menu. They just want to see the location first and then decide if they want to move forward. Let them know landlord wants to see those documents to qualify them as a tenant before showing tghe space.

12:45 pm- Receive an email from a buyer in South Carolina, they want to make an offer on a Franchise Restaurant I have listed in South Carolina. The buyer requests a copy of our Asset Purchase Agreement. I draft the Agreement and send for review.

1:30 pm – Follow up with Dickey’s BBQ Pit to confirm buyer’s Discovery Day date to attend at Dickey’s Headquarters.

2:00 pm – Conference call with Wich Wich, buyer, seller, and Area Representative to discuss transfer checklist

2:30 pm-  Schedule a meeting between buyer and seller at restaurant for Friday

2:45pm- Follow up with Firehouse Subs Area Representative to discuss training day for approved candidate.

3:00 pm – Review an 80-page lease to find out the lease expiration, option renewals, security deposit, CAM charges, and type of restaurants allowed in the shopping center

3:30pm- Follow up with closing attorney on debits and credits for Closing Settlement Statement.

3:45pm- Receive a referral for a Firehouse Subs seller who wants to sell from my current client

4:00pm – Assist buyer with working on bank projections for loan approval. Review business plan and give feedback for improvement.

4:45pm- Follow up with listing leads and search for more leads

5:30pm- Work on Science Project with my 5th grade daughter Amaya

7:00 pm- Draft emails to send out in the morning

7:30 pm- My wife arrives at home!

7:45 pm- Receive text message from seller, asking for an update on buyer activity for their listing.

Dominique writes, "To be an excellent Restaurant Broker you must multi-task and be the quarterback of the deal. Nobody wants to get the deal done more than the Broker.  It can be the difference between feeding your family ground beef or filet mignon.  Yes, most days I’m drained from my daily activities and I’m constantly thinking about items that need to be complete on each deal at night. The satisfaction I get from this career is knowing I help people realize the American Dream of Business Ownership. Tomorrow I will get up and do it all again."

 

Domminique Maddox is a licensed Georgia real estate agent and graduate of Morehouse College which he attended on a football scholarship.  He brings that same competitive spirit and energy to the field of restaurant brokerage. Dominique received a Bachelor of Business Administration in Business Management from Morehouse College.  He has worked in mortgage financing, real estate, business to business sales, and Restaurant Brokerage Sales.

Dominique was named the recipient of the Georgia Association of Business Broker "Rookie of the Year" award from the organization for 2011.Dominique was also elected as a Director to the Georgia Association of Business Brokers for 2012. Dominique has undergone extensive training for restaurant brokerage and has earned the designation as a Certified Restaurant Broker. View his listings online at this link.

 

 

Topics: buying a restaurant, buying a restaurant, selling a restaurant

Restaurant Brokers Designated as Industry Experts by Business Brokerage Press

Posted by Robin Gagnon on May 29, 2017 5:07:55 PM

Restaurant Brokers Eric and Robin Gagnon have been designated by Business Brokerage Press as Industry Experts yet again for 2017.  The Industry Expert program is recognized across the nation for brokers that have in-depth knowledge of a particular type of business.  It's based on a questionnaire distributed by the group that demonstrates specialized skill in an industry and transaction experience.  . 

Industry_Expert_Logo.jpgEric and Robin Gagnon will be included in the Industry Expert section of the Business Reference Guide published by Business Brokerage Press or BBP.  Experts in this program must qualify through demonstration of in-depth knowledge for a particular type of business.  Only those qualified and approved by BBP may be listed as a source with expert knowledge in their prospective industry. 

The Restaurant Brokers, Eric and Robin Gagnon, have both qualified for this honor for multiple years in both Restaurant Sales and Franchise Resales.  The dynamic duo and husband and wife team are the founders of We Sell Restaurants, the nation's largest restaurant brokerage practice and franchise brand.  

ERIC GAGNON is the founder and President of We Sell Restaurants and wesellrestaurants.com.  He is the nation’s leading restaurant broker.  Eric is an industry expert in restaurant sales and valuation.  He is a frequent speaker, writer and co-hosted the nation's only radio show devoted to the restaurant industry for several years.  Eric is co-author of Appetite for Acquisition, an award winning book on restaurant brokerage published in 2012 and named "Best of" by Small Business Book Awards.  Eric began his career in the financial services industry for Bank of America, Bank of New York and big five accounting firm, KPMG before launching the nation’s premiere restaurant brokerage firm and restaurant brokerage franchise.  Eric is member of the International Franchise Association, the Georgia Association of Business Brokers and the Business Brokers of Florida.  In addition, he serves on the Executive Board for the Southeast Franchise Forum and the Membership Committee of the International Business Brokers Association.  

ROBIN GAGNON is the Co-Founder of We Sell Restaurants and the firm's Chief Marketing Officer.  Robin is one of the most prolific restaurant brokers in the industry and is a franchise resale specialist.  She is also a writer and speaker that has addressed the International Business Broker Association, International Franchise Association, Sysco Food Show and multiple colleges and universities. Robin's expert articles appear online and in print across the country. She co-authored Appetite for Acquisition, an award winning book on buying restaurants that was published in 2012 and named "Best of 2012" by Small Business Book Awards. She is the co-host of the long-running radio show "We Sell Restaurants."  Robin is a member of the International Franchise Association and serves on the Women's Franchise Committee.  She is also the Chair of the Women's Franchise Network - Atlanta Chapter.  

These veteran industry experts have defined the term “Restaurant Brokers” with their unmatched experience, knowledge and count of restaurants sold.  Impactful speakers, they have presented workshops and served on multiple panels for organizations nationwide where they share their expertise. They created and developed training for brokers to obtain the credential of Certified Restaurant Broker.

The two have trademarked their brand, “We Sell Restaurants” and are franchising nationwide. They share their knowledge through one of the most extensive training programs available to the industry. Their multi-platform training program leads to the nation’s only Certified Restaurant Broker designation.

For nearly 34 years, Business Brokerage Press has worked to benefit business brokers through valuable publications, services and resources specific to the business brokerage profession.  In addition to their Industry Expert program, they publish source books for the industry including The Complete Guide to Business Brokerage; and the Business Reference Guide, first published in 1991.

The Business Brokerage Press legacy extends to the International Business Brokers Association (IBBA) as the founders were instrumental in launching this international organization.  For over 10 years, Tom and Barbara West of Business Brokerage Press had a hand in running the Association until they turned it over to a management association company so they could focus their time and attention full time on BBP.

For more information about We Sell Restaurants, visit wesellrestaurants.com or for franchising information, visit wsrfranchise.com

  

 

Topics: buying a restaurant, buying a restaurant, selling a restaurant

Top 10 Restaurants for Sale in April by the Restaurant Brokers

Posted by Robin Gagnon on May 12, 2017 1:56:45 PM

What’s the pattern of views of restaurants for sale for April 2017?  It was a month of strong activity by buyers showing signs of Spring Fever excited by a new crop of listings.  South Florida topped the chart with activity on multiple listings while the Atlanta and Austin markets were also strong performers for the restaurant brokers this month.

 As always, we weigh the activity on listings based on the phone calls, response to our email blasts, signed confidentiality agreements and connections with our restaurant brokers.

Topping the list of restaurants for sale with the most views is a SUPER priced Italian Restaurant located in Broward County. This location has been hot since hitting the marktet less that 70 days ago. Priced at under $50,000 this listing has attrached the most buyers for the month in the We Sell Restaurants inventory.  

 
Listing ID:5311 Restaurant Broker Ken Eisenband    
Pizzeria for Sale -- Fast Casual Italian Restaurant in Broward County
Lease: Expires January 31, 2018 plus 2 three year options
Monthly Rent: $4612.78
Inside Sq. Ft. 1716
Outside Sq. Ft.
Price:$45,000
City:Tamarac

Ken Eisenband
(561) 350-3365

South Florida stayed in the mix with this Broward County listing attracting buyers.  They also loved this Italian Restaurant for sale that can retain its current look or convert to any concept.  This one made an impact on those looking to make their dreams of restaurant ownership come true. With an incredible monthly rent of less than $3000, this location won't be around much longer

Listing ID:5228 Restaurant Broker Ken Eisenband    
Restaurant for Sale in Ft. Lauderdale Can Convert to Any Concept
Lease: Expires July 31, 2017 with options to be negotiated
Monthly Rent: $2980
Inside Sq. Ft. 1700
Outside Sq. Ft.
Price:$58,000
City:Fort Lauderdale

Ken Eisenband
(561) 350-3365

The top three listings of the month had one thing in common -- Italian was on the mind.  This profitable location in the very desirable Rosewell, Georgia area garnered plenty of looks, calls, signed CA's and views on the Restauant Brokers top rated website.  The $1700 monthly rent is unheard of! No wonder it has already has multiple offers.

Listing ID:5441 Restaurant Broker Steve Weinbaum    
Profitable Italian Bistro and Pizza Business for Sale in Downtown Roswell!
Lease: 5 years
Monthly Rent: $1700 including CAMS
Inside Sq. Ft. 1600
Outside Sq. Ft. n/a
Price:$139,000
City:Roswell

Steve Weinbaum
(770) 714-4552

Austin Texas Restuarant Broker Dave Duce jumped into the top ten list with a unique opportunity in his market.  Buyersare clicking away to find out more. This Bar for Sale in Austin serves beer, wine and small plates.  This one was on the market for only seven days in April before landing in the top 5.  Buyers should prepare for a bidding war on this one!

isting ID:5469 Restaurant Broker Dave Duce    
Bar for Sale in Austin Serving Beer & Wine - Expand to Craft Beer & More
Lease: expires Nov 2020 + 5 yr option
Monthly Rent: $1850
Inside Sq. Ft. 737
Outside Sq. Ft. 60
Price:$99,995
City:Austin

Dave Duce
(512) 773-5272

Restuarant space for lease often creeps into the Top 10 and this Johns Creek, Georgia empty location was no exception.  Those ready to launch from the ground up liked the looks of this opportunity.  The very manageable 1200 square feet allows to keep the rent down monthly but still room for plenty of seats. What are you waiting for?

isting ID:5274 Restaurant Broker Cyndi Weinbaum    
Restaurant Space for Lease in Johns Creek, Georgia - Great Location
Lease: Negotiable
Monthly Rent: $$20.00 PSF + $4.43 CAM
Inside Sq. Ft. 1200 (Adjacent site can be added bringing total to 2400 Square Feet)
Outside Sq. Ft.
Price:$0
City:Johns Creek

Cyndi Weinbaum
 

Space for lease with equipment? Yes! This does not come along every day. This former Pizza place is flipping for a new owner! Sign the lease today and start cooking tomorrow.

Listing ID:5208 Restaurant Broker Ken Eisenband    
Fort Lauderdale Restaurant Space for Lease includes Kitchen Equipment
Lease: Negotiable with Landlord
Monthly Rent: $7393.50
Inside Sq. Ft. 2700
Outside Sq. Ft.
Price:$0
City:Fort Lauderdale

Ken Eisenband
(561) 350-3365

 Two for One!  This sounds like a Happy Hour deal but instead it's a restaurant for sale group also found in Austin Texas.  This features a long term lease and loyal clients.  The two restaurants for sale by Certified Restaurant Broker Dave Duce are turnkey ready for someone looking to start earning a profit.

isting ID:5465 Restaurant Broker Dave Duce    
2 Restaurants for Sale! 6 Figure Earnings - Sandwiches & Catering
Lease: expires March 2022
Monthly Rent: $1326
Inside Sq. Ft. 3200
Outside Sq. Ft. 200
Price:$299,000
City:Austin

Dave Duce
(512) 773-5272

What happens when we list a restaurant for sale with rent at just $1000 per month?  The phones go wild!!!  This crazy low rent in Inman Park is fully equipped and ready for a new concept.  The 1000 square foot space is perfect for a take-out or delivery concept and Restuarant Broker Steve Weinbaum's phone has been blowing up with inquiries.  Are you ready to take this one off the market?

Listing ID:5193 Restaurant Broker Steve Weinbaum    
Inman Park Atlanta Restaurant For Sale - $1000 per Month Rent!
Lease: 3 years with 2+ years remaining
Monthly Rent: $$1000 plus $1400 annual property taxes
Inside Sq. Ft. 1000
Outside Sq. Ft. n/a
Price:$49,990
City:Atlanta

Steve Weinbaum
(770) 714-4552

All in all, another record breaking month of activity for the restaurants fo sale across the country.   The southeast is booming in restaurant sales as evidenced by all this activiy on the restaurant brokers listing.  Want to see these and many other restaurants for sale?  Check out our full list of restaurant for sale listings online at this link. 

 

Topics: buying a restaurant, selling a restaurant

A Restaurant Buyer or Seller’s Guide to Valuation by the Restaurant Brokers

Posted by Robin Gagnon on Apr 25, 2017 9:01:33 AM

While everyone has some idea how much they want to pay or price a restaurant for sale, the truth is, selling a restaurant is a math problem with a right and wrong answer

What is the methodology for restaurant valuation?  For lenders and sophisticated restaurant brokers familiar with the process it’s the Income Valuation Method.  This is the most favorable and trusted method used to value restaurants for sale.  In today’s lending environment, this is how we establish value and secure financing on a business.  A restaurant for sale with solid profits that fits the SBA criteria to both satisfy the buyer’s lifestyle needs and satisfy the debt payments with a 25% cushion will qualify for lending.    

 For that reason, the Income Valuation Method provides the most acceptable method of valuation for banks, lenders and individuals in assessing how much to pay for a restaurant.  In a situation where a restaurant buyer is paying cash, this helps to reduce fear of the transaction as the business has a proven track record. 

calculator-988017_960_720.jpgA restaurant for sale with strong books and records, assessed under the Income Valuation Method has the highest number of potential buyers and hence commands the highest possible price.  An expert  restaurant broker can go through the Profit and Loss statement along with tax returns to find the Seller’s Discretionary Earnings (SDE) or owner benefit that is customarily accepted by lenders to value the business.   This includes net income PLUS reasonable and customary add-backs.

Add Backs are the benefits realized by a seller today that go away when he or she leaves the business. For example, owner’s 1099 or W2 earnings are calculated as Add Backs.  Any personal expenses such as a cell phone or auto expense for the benefit of the seller are also “added-back” to the bottom line to calculate the earnings.

What is not allowable for “add-back” purposes are efficiencies a new owner could potentially achieve that the current operator hasn’t.  It should factor in your decision to buy but should not be calculated in the pricing of any    restaurant for sale.  The entire purpose of the add backs is to calculate owner benefit and ultimately pricing of the business.  If you can identify strategies to be more successful in the future than the current owner, that benefit belongs to you as a buyer, not to the seller in the pricing of the business. 

Once the Seller’s Discretionary Earnings is appropriately determined, then it becomes the basis for a “multiple” for pricing    restaurants for sale. Every buyer wants the answer to the question, “What’s the multiple for restaurant pricing?” and the response rarely satisfies anyone.  In general, restaurants for sale can be offered and sold somewhere between 2.5 and 3 times times earnings, with market factors adjusting this up or down.  For purposes of this article, we are limiting our discussion to single restaurant units.  Multi-unit sales (anything above two, especially franchise) changes the multiple significantly and requires a whole different analysis and pricing model.

“How much to pay for a restaurant for sale? ” can be affected by any of the following variables including:  strength of books and records, saturation of concepts in the marketplace, seasonality, location,   comparable Sales Information or “comps,”  franchise or  independent offering, geography and competition. 

Strong restaurant brokers that know the market and should be able to share exactly where a restaurant is priced based on the multiple and why.   Ask some questions of your broker to be certain they fully understand restaurant pricing.  If you’re not satisfied with the response, find an expert restaurant broker to help you buy a restaurant.

Our restaurant for sale listings are all valued using the same methodology and can be found at this link.

Check Available Listings

Topics: buying a restaurant, selling a restaurant

Restaurant Brokers Expanding Coast to Coast - Attendees at We Sell Restaurants University

Posted by Robin Gagnon on Mar 23, 2017 8:30:46 AM

We Sell Restaurants is expanding coast to coast with a new class of training candidates enrolled in We Sell Restaurants University. 

Rob Morrison.jpgWe Sell Restaurants Ft Lauderdale is welcoming Rob Morrison to their team. A former U.S. Marine, Robert is currently a Board Member of the Broward County Veterans Association of Real Estate Professionals (VAREP), a non-profit organization dedicated to increasing economic opportunities for active-military and veteran communities.  

Rob studied Communication at the University of Miami and had a long, successful career as an award-winning journalist in New York City. Upon relocation to South Florida Rob entered the real estate business. Rob’s experience in commercial real estate has aided his clients greatly.  He will be completing We Sell Restaurants University next week and will begin work with Ken Eisenband, the franchise partner for this office.  E

Chris Morrison.jpgColorado Franchise Partner, John Jordan is also expanding his group.  His newest Restaurant Broker is Chris Gordon.  Chris has over two decades of experience in the restaurant industry and has proven himself to be an adept leader and skilled businessman.  A resident in the Denver South Metro area, some of his highlights through the years include working at The Fillmore Auditorium, Breckenridge Brewery, and most recently the Tailgate Tavern and Grill as General Manager. 

Chris entered the restaurant industry as a dishwasher when he was 15 years old, and worked his way up through the ranks to managing a multimillion dollar restaurant when he was just 19.  He has been a busboy, host, and cook, server, bar back, bartender, banquet captain as well as a corporate trainer.  He has served in leadership roles as both a Manager and General Manager for multiple operators.  Chris has worked on the Las Vegas Strip for celebrity chef Rick Moonen at Mandalay Bay and Del Frisco's Double Eagle Steakhouse.

As the General Manager for Tailgate Tavern he helped increase sales by over 50% the first year.  “We achieved this by completely redesigning the bar to function more efficiently, reducing the cost of raw materials, and creating incentives for the customers to spend more money.”

Scott Ruby.jpgAlso attending We Sell Restaurants University is the newest Franchise Partner, Scott Ruby.  Scott has expereince in both the front and back of the house along with first-hand knowledge of day to day operations and restaurant culture. Scott’s Food and Beverage industry experience evolved during his years in specialty restaurant management and as a Food and Beverage Director in Las Vegas, Nevada.
 
Scott’s experiences in the Vegas food and beverage mecca included the opportunity to be a key player on the grand opening team at the House of Blues, Mandalay Bay property, manage the House of Blues restaurant and in later years, he was recruited by Station Casinos.  In his tenure with Station Casinos as a Food and Beverage Director he was fortunate again to see expansion in opening both Sunset Station and Green Valley Ranch.  
 
In recent years Scott’s professional experience has been focused on operations, sales and marketing.   Having worked with the BNSF Railway, a fortune 100 company he served to grow and develop their market share.  Scott was honored to be chosen as employee of the year with this company thanks to his commitment to customer service and company culture.

The full class graduates on March 31 and will begin work in their markets immediately.  
 

 

Topics: buying a restaurant, selling a restaurant

Roly Poly Franchise Store SOLD in 60 Days by The Restaurant Brokers

Posted by Robin Gagnon on Mar 20, 2017 3:22:50 PM

The Restaurant Brokers at We Sell Restaurants announce the sale of the Roly Poly Fast Casual franchise in Cumming Georgia.

Roly Poly franchises offer an extensive menu with great taste photo 2.jpg and superior nutrition! Restaurant broker Robin Gagnon described the store as "Small enough that you will matter and big enough that you get volume buying power, strong systems and superior support."  The Award winning concept was designated a Hot Concept by Nation’s Restaurant News.

Entreprenuer and Restaurant Buyer Janet Jacks snapped up the location in under 60 days leading to a record fast closing.  Buyer Janet Jacks has owned several different businesses but like the opportunity to have a business that would be close to home. Located in the busy Atlanta metro area a short drive to work is always a benefit!

The very short time on the market was perfect for the company's founders and the operators of this corporate store that said, "Robin and We Sell Restaurants sold our location in Cumming in less than 60 days from start to finish.  We previously had the business listed with another broker for more than six months with no activity or communication from the agent.  We definitely recommend their services.”

The Roly Poly brand is a favorite of customers that are seeking a restaurant franchise for sale but don’t want the late hours, lots of employees, frying and complications.  This one is a lifestyle brand.  Certified Restaurant Broker Robin Gagnon represented the buyer and seller in this transaction.

Gagnon said of the location, "This was a great store in a vibrant neighborhood and growing community."  The demographics for the area show a total daytime population within a five mile radius of 132,196.  Average household income is six figures plus at $127,815. 
 
This particular location was a a stable and established store that's had a great customer base since 2014!  The reviews from the customers are incredible.  Restuarant buyers often seek established  franchise restaurants for sale because they give the purchasers the benefit of joining a brand that is already established.  The franchise brand expertise and support can guide new owners through the daily operation. Top that with your personal knowledge, your drive and your ideas and you get the perfect mix to run a successful restaurant.

Check out our current listings at wesellrestaurants.com.  More information on buying a restaurant can be found at this link where buyers can download our free book on buying a franchise restaurant.   The free report includes:  

  • How to find the best Franchise Resale deals
  • How Much to Pay for Franchises
  • Why an SBA loan is your Franchise Friend
  • Key Steps in the Franchise Resale Process
  • When to Apply with the Franchise & Why
  • Valuation Math for Franchises for Sale

 

 

Topics: buying a restaurant, selling a restaurant