Advice for Buying a Restaurant and Selling a Restaurant

We Sell Restaurants Founders Earn CBI (Certified Business Intermediary) with IBBA

Posted by Robin Gagnon on May 14, 2018 3:23:48 PM

Eric and Robin Gagnon, the founders of We Sell Restaurants have each recently earned a designation in the industry as a Certified Business Intermediary or CBI.  The prestigious designation is held by less than 500 individuals worldwide. The two tested last week in New Orleans at the annual conference of the International Business Brokers Association.  Those holding this designation represent a unique community of professionals who have undergone significant coursework, possess relevant experience and have passed a test consisting of both industry knowledge and financial competency in recasting. 

Eric Robin Gagnon The CBI designation is earned through the International Business Brokers Association or IBBA.  The IBBA website states that, "the Certified Business Intermediary (CBI) is a prestigious designation exclusive to the IBBA that identifies an experienced and dedicated business broker. It is awarded to intermediaries who have proven professional excellence through verified education as well as exemplary commitment to our industry."  They go on to remark that the designation will, "indicate to potential clients that anyone who holds the CBI certification is a knowledgeable, invested, and dedicated brokerage professional. Successful completion of the certification process significantly distinguishes business brokers from their peers." 

Lifelong learners who are committed to the business brokerage and restaurant industry, the Gagnons had this to say about their latest certification.  "Teaching others how to buy a restaurant, sell a restaurant or just providing overall knowledge and data points are critical to our practice.  A designation like the CBI is just one more piece to our overall commitment to the highest caliber knowledge base we can draw upon to help our customers." 

The International Business Brokers Association (IBBA) is the largest international non-profit association operating exclusively for people and firms engaged in business brokerage and mergers and acquisitions. This association provides business brokers education, conferences, professional designations, and networking opportunities. Formed in 1983, the IBBA has members across the world.

The IBBA strives to create a professional relationship with successful business transaction advisors (i.e. CPAs, bankers, attorneys, and other related associations), to increase the image and value of the IBBA to its members and to be a leader in the exchange of business referrals. A membership in the IBBA provides “the most complete package of membership benefits and services and the best networking opportunities with the most influential group of business brokers.”

The IBBA concentrates on providing educational courses for the business broker profession. It awards the Certified Business Intermediary (CBI) certification as well as the courses and seminars required to obtain this certification.

CBI

Eric and Robin Gagnon have long histories in the business brokerage industry.  They launched the We Sell Restaurants brand in 2001 and currently work in approximately 45 states across the nation.   

Eric 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.  Eric, along with Robin is the 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 the Past President of the Georgia Association of Business Brokers (GABB) and Lifetime Member of the Million Dollar Club. He is also the recipient of the Phoenix Award, presented to a select few who have received the Million Dollar Award for more than a decade.  He is a member of the International Business Brokers Association (IBBA), Business Brokers of Florida (BBF), and the International Franchise Association (IFA). Eric is also an active member of the for the Southeast Franchise Forum where he serves on the membership committee. Eric is licensed as a Broker in Georgia, Florida and South Carolina.   He holds degrees from major universities in both the United States and Canada. 

Robin 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. Robin's expert articles appear online and in print across the country. She co-authored Appetite for Acquisition,  the industry's leading book on buying restaurants that received the prestigious "Best of " award by Small Business Book Awards.  Robin is a member of the International Franchise Association and serves on the Women's Franchise Committee and the 2018 Conference Committee.  She is also the Chair of the Women's Franchise Network - Atlanta Chapter.    

Robin holds an undergraduate degree and an MBA where she graduated first in her class and was named "Outstanding MBA." Robin is an emeritus member of the ASU Business Advisory Council. She is also a founding member of the ASU Entrepreneurship Board. Robin is a licensed real estate salesperson in both Georgia and Florida and member of the Georgia Association of Business Brokers (GABB), the International Business Brokers Association (IBBA) and the Business Brokers of Florida (BBF).  She has been named a National Industry Expert by Business Brokerage Press in Franchise Resales.   Prior to joining We Sell Restaurants, Robin served as Vice President of Strategic Marketing for a $4 billion-dollar retailer and Director of Advertising and Director of Business Development for another Fortune 100 company. 

For more information on the services of We Sell Restaurants or its founders, visit their website at wesellrestaurants.com 

 

Topics: Buying a Restaurant, Selling a Restaurant

April Top Ten Restaurants for Sale

Posted by Robin Gagnon on May 11, 2018 4:27:26 PM

Topics: Buying a Restaurant

Restaurants Sales flat in 2017 - What does 2018 Look Like?

Posted by Robin Gagnon on Apr 26, 2018 8:37:59 AM

What happened to restaurant sales in 2017?  Well the Restaurant Brokers at We Sell Restaurants are studying the latest data released by accounting firm BDO.  Here are some of the findings from their report and our analysis.  

For the first time in recent memory, restaurant same-store sales were flat in 2017 with no increase over the prior year.  According to the BDO article, "The year was marked by continued change in consumer preferences, but positive economic indicators and improved consumer confidence failed to convert to more comparable sales for restaurateurs.?

In a world of increasing costs, creeping rents, rising labor rates and other economic pressures on the business, this report on restaurant sales can seem a bit discouraging.  What happened in 2017? 

The big hit to the industry was in the fast casual category.  As it's a large percentage of the overall base, where fast casual goes, so goes the industry.  Their negative trend contributed heavily to the overall flat performance.  As reported by BDO, the fast casual segment was down 1.6 percent for the year.  In the opinion of these restaurant brokers, this is partly a reaction to the "me too" trend that affects the business each time winning concepts emerge.  For the past five years, the growth in the number of fast casual concepts, all fighting for a piece of the pie has led to many options for customers and an overall shrinking share.  You did not have to be a restaurant broker to see this one coming. When the best performer in the industry was  Chipotle who was comping negative 20 percent sales against the prior year, it's a signal that there are too many players all vying for the same customer.  We actually expect this trend to continue. 

Why was fast casual hit the hardest?  The economic news is good and consumers have more money in their pocket.  However, the inverse of what occurs when the economy is bad is now taking place.  Customers trade up to the next level of dining.  The other reason for the drop in 2017 is the slowness of fast casual to adopt to delivery trends.  Operators did not want to give up dollars to Grub Hub, Uber Eats, Door Dash and the other giants of delivery.  By holding back, they cost themselves sales.  They are now seeing that the topline sales increase may be worth the profit swap as those in the delivery funnels are getting the dollars from time challenged customer.  We anticipate more fast casual concepts will be tying their menus to this delivery wagon and it will rebound some sales for them. 

One sector did outperform the others.  Pizza  topped the list with a 2.9 percent increase in the year.  That was below their 2016 trend of plus 4.6 percent however.  We expect pizza to continue to perform but the options for delivery may continue to slow their performance against the overall market. 

Other sectors reported as follows in the BDO results: 

  • Quick serve posted a modest 0.8 percent increase through Q4 2017. The category was led by Carrols Restaurant Group (+5.2 percent), Taco Bell (+4.0 percent), and McDonald’s (+3.6 percent).
  •  Upscale casual and casual reported flat results for the year at -0.1 percent and 0.0 percent, respectively. Texas Roadhouse was the top performer in the casual category, reporting a 4.5 percent increase for the year, while Applebee’s (-5.3 percent) continued to struggle.

There is encouraging news for the future as some investments in 2017 will pay off this year. Restaurant owners spent money on technology, delivery partnerships, new concepts, menu upgrades, and experiences.  There's no instance success button for restaurant sales.  We anticipate that with continued strong consumer confidence, actual results in the market from the tax cuts, and greater emphasis on joining the delivery bandwagon, fast casual and the total industry will post better results in 2018.   

 

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Topics: Buying a Restaurant

As the Restaurant Brokers Predicted, 2018 Business Sales Climb to New Heights

Posted by Robin Gagnon on Apr 16, 2018 10:03:51 AM

The Restaurant Brokers have been bullish on restaurant sales since very early in 2017 and our predictions have been spot on with reports from the marketplace.  BizBuySell is confirming our findings, stating that the first quarter of 2018 brought "record-breaking sales prices and transactions"  for  business sales.

Orange Accent Photography Quote2018 Versus 2017 Results

Asking prices, count of restaurants on the market and selling prices all rose in the first quarter of 2018 versus 2017 acording to the latest tracking data released by BizBuySell.  In their report, "small businesses sold for the highest sale prices since they started tracking data in 2007."  That's a decade ago!  Selling prices were up 3.4 percent increase from last year at this same time.  Asking prices are up as well.  Their report says that the median asking price of sold businesses also hit a record high.  The number was $262,000, a 4.8 percent increase over 2017.

There were a total of 2,678 businesses sold in the first quarter of 2018. This represents a 13.1 percent increase from this time last year and the most businesses reported as sold in a quarter since BizBuySell began collecting this data. What about restaurant sales?  Restaurants represented 21% of all businesses sold.  From our internal data, as the largest restaurant brokerage firm nationwide, we can confirm that transactions, asking prices and selling prices are all up from last year.  Restaurant transactions were up 7.65 nationwide in the first quarter. 

Drivers of these Results

What's driving the change?  It's the Trump effect and specifically, the tax bill.  Small business owners are listing businesses they previously held back on because they know the tax consequences are less when it sells in 2018.  Simultaneously, small business confidence is at an all time high.  The tax bill has made a number of buyers and seller realize that their efforts will put more money in their pocket so small business ownership is looking good to them.  

The strong stock market has also contributed to the boom in restaurant sales.  Many buyers rely on 401K savings and fund acquisitions through rollover products.  Now that their savings have seen a 20% to 25% bump in the last year, they are feeling flush with cash and ready to invest in themselves. 

Will it Continue?  Only if the Tax Bill Remains Unchanged

What do the trends look like?  Here's the quarter by quarter graph released by BizBuySell showing the sale price versus asking price since 2014.  You'll see that the first quarter of 2018 has the highest point on the graph.  The restaurant brokers fully expect this trend to last for the year with one caveat.  Should the Democrats take back control of the House or Senate, putting them in a position to reverse the tax package, as they have pledged, expect these numbers to tumble significantly.  

2018 Q1 Small Business Sale Price vs Asking Price

For now, the tax package has not only spurred tremendous growth in sales, it is also paying for itself, a little discussed fact released by the Congressional Business Office or CBO last week.  Last June, the CBO said GDP growth for 2018 would be just 2%. Now it figures growth will be 3.3% — a significant upward revision. It also boosted its forecast for 2019 from a meager 1.5% to a respectable 2.4%. The CBO now expects GDP to be $6.1 trillion bigger by 2027 than it did before the tax cuts. The CBO report also makes clear that this faster-growing economy will offset most of the costs of the Trump tax cuts.   BizBuySell surveyed business owners and and nearly half of them (more than 48 percent) believe the tax changes benefit small businesses.  Less than a quarter (24 percent) found it harmful. 

Business Confidence Rules

The restaurant brokers aren't the only ones discussing business confidence.  The NFIB or National Federation of Independent Business group surveyed its members in February.  In their  Small Business Economic Trends Survey, they reveal that "small business owners are showing unprecedented confidence in the economy."  These results are spilling over to unemployment numbers which has fallen to 4.1 percent, the lowest since the dotcom boom back in 2000.  That is also affecting small business owners and of those surveyed by BizBuySell, 60 percent plan to hire more staff and 57 percent plan to raise compensation.  

 All of this economic growth is pushing those interested in small business ownership to seek opportunities like our restaurants for sale, especially since the businesses themselves are performing better. 

Cash Flow Trends

Restaurants for sale like the ones we represent are priced based on cash flow.  The businesses sold in the first quarter of the year reproted higher earnings.  That is the trigger for rising valuation and ultimately, higher selling prices.  The median cash flow of businesses sold in Q1 increased to $120,000, a 2.3 percent increase over the same time last year.  This is still a minor raise that would not dramatically affect pricing but we expect to see this trend continue up as well.  Businesses selling in 2018 are reflective of 2017 earnings.  As trends strengthen this year, this will be factored into the valuation of transactions later in the year.  

Are more sellers putting their businesses on the market?  Yes.  The report found an increase of 6.9 percent in businesses listed.  The restaurant brokers continue to believe the time has never been bettter for selling.  Between small business confidence, the number of buyers in the market and continued favorable lending trends, 2018 is the year to sell your restaurant.

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Topics: Buying a Restaurant, Selling a Restaurant

Top 10 Restaurants for Sale in March 2018 by We Sell Restaurants

Posted by Robin Gagnon on Apr 3, 2018 8:55:06 AM

What was on the mind of restaurant buyers in early Spring of 2018?  We can tell you.  The market made a turn from established franchise restaurants for sale to independent concepts and lease locations.  In a surprising twist, only one franchise restaurant for sale location made it onto the top ten list published by the restaurant brokers each month.

We measure the top ten by looking at all the activity on our listings including signed confidentiality agreements, agent outreach by buyers and views on our site and other national websites.  The results are recapped below.

Topping off the list this month was a breakfast and lunch restaurant for sale in Coral Springs.  The low cost of entry and excellent rent for the market drove buyers to request additional infomation on this gem.  We suspect that Franchise Partner and Certified Restaurant Broker Ken Eisenband will have this one in contract shortly.  

Listing ID:6003 Restaurant Broker Ken Eisenband    
  Breakfast and Lunch Restaurant for Sale in Coral Springs with Low Rent
Lease: Expire November 30, 2018, plus option
Monthly Rent: $1166
Inside Sq. Ft. 900
Outside Sq. Ft.

Price:$59,000
City:Coral Springs 

. Ken Eisenband 
(561) 350-3365

Our second most popular listing for the month was a money-making monster out of Savannah Georgia.  Three existing units are generating strong sales and even better -- earnings of more than $200,000.  This listing got our restaurant buyers clicking, calling, emailing and viewing like crazy.  Bring your offers on this one.  Six figure earnings are rare and those that exceed $200,000 are like unicorns --  you've never seen one!  
Listing ID:6035 Restaurant Broker Eric Gagnon    
  Three Franchises for Sale - Multi Unit Opportunity earning $200,000++
Lease: Dec 2022 |Dec 31, 2024 | Nov 2020 plus 2 5yr options
Monthly Rent: $3591.91 | 2504.59 | 4356.25
Inside Sq. Ft. 1200 |1225 | 1394
Outside Sq. Ft.

Price:$749,000
City:Savannah | Savannah | Pooler 

Eric Gagnon 
(404) 800-6704

Dave Duce reports that Austin Texas is booming with development and restaurants are changing hands quickly.  One of his latest listings, a fully built out restaurant that's turnkey ready in the city was number three on the top ten list of restaurants for sale this month.
Listing ID:6012 Restaurant Broker Dave Duce    
  Fully built-out restaurant for sale available in West Austin Texas
Lease: 5 years
Monthly Rent: $5860
Inside Sq. Ft. 2144
Outside Sq. Ft. 200

Price:$160,000
City:Austin 

Dave Duce 
(512) 773-5272

Any restaurant for sale listing priced under $100,000 is sure to get strong activity and this one in Pompano Beach definitely made the cut for that reason.  The current concept is Pizza and Italian and any restaurant buyer could pick this one up and keep it exactly the same or connvert to a new concept. 
Listing ID:5995 Restaurant Broker Ken Eisenband    
  Pizza and Italian Restaurant for Sale in Broward County is Turnkey
Lease: Expires on October 31, 2018 plus 5 year option
Monthly Rent: $5400
Inside Sq. Ft. 2500
Outside Sq. Ft. 0

Price:$89,999
City:Pompano Beach 

Ken Eisenband 
(561) 350-3365

A fully equipped and built out restaurant for sale in Cobb County Georgia, home of the new Atlanta Braves stadium got lots of looks, calls and signed confidentiality agreements.  The low price, coupled with unbelieveable rent, make this a candidate for re-branding.  Restaurant broker Dominique Maddox is the contact point for this restaurant for sale priced at under $50,000.
Listing ID:6034 Restaurant Broker Dominique Maddox    
  Diner for sale in Cobb County. Rated number #1 on Yelp!
Lease: Expires May 2018
Monthly Rent: $1350
Inside Sq. Ft. 1500
Outside Sq. Ft.
Price:$49,995
Dominique Maddox 
(404) 993-4448
Broward County and Italian restaurant for sale opportunities go hand in hand!  Thi Oakland Park beauty has monthly rent of just $2404 and is listed for under $200,000.  We expect offers soon on this well-priced business with below market rent for the area.  The restaurant for sale includes both indoor and outdoor dining options, unheard of for this rent.
Listing ID:5910 Restaurant Broker Ken Eisenband    
  Italian Restaurant for Sale in Broward County returns over $117,000 to owner
Lease: Expires November 30, 2021 plus five year option
Monthly Rent: $2404
Inside Sq. Ft. 1200
Outside Sq. Ft. 300

Price:$199,000
City:Oakland Park 

Ken Eisenband 
(561) 350-3365

When we say Bar for Sale and Metro Atlanta, the numbers fly!  Restaurant Broker Steve Weinbaum listed this opportunity for just $100,000 and it easily made it into the top ten for the month.  The monthly rent is excellent and this is in Atlanta central.  This bar for sale is a great opportunity that will not last. 
Listing ID:5983 Restaurant Broker Steve Weinbaum    
  Metro Atlanta Area Bar for Sale - Great Rent Rate Includes Utilities!
Lease: four years remaining
Monthly Rent: $4300 includes CAMS and Utilities
Inside Sq. Ft. 2586
Outside Sq. Ft. n/a

Price:$100,000
City:Atlanta 
 

Steve Weinbaum 
(770) 714-4552

The Atlanta marketplace and Restaurant Broker Steve Weinbaum grabbed a lot of listings for the top ten including this restaurant for lease opportunity in Roswell Georgia.  The location is ideal.  The infrastructure is in place to convert to virtually anything and best of all, there's no out of pocket!  Bring your ideas, your menu, your financial statement and your business plan for this lease space and open your dream restaurant today.
Listing ID:5079 Restaurant Broker Steve Weinbaum    
  Restaurant for Lease in Roswell GA
Lease: To Be Negotiated
Monthly Rent: $3,492 with CAMS
Inside Sq. Ft. 1600
Outside Sq. Ft.

Price:$0
City:Roswell 

Steve Weinbaum 
(770) 714-4552

A second restaurant space for lease in Roswell Georgia drove lots of looks and phone calls as well.  This one, also offered by Steve Weinbaum is a larger space at 4,250 square feet and the rent is negotiable.  The current rental market is very tight with limited availability so it's no wonder the Restaurant Brokers are getting so many looks on these listings.
Listing ID:6023 Restaurant Broker Steve Weinbaum    
  Restaurant space for lease! Endcap Unit in Booming Roswell Georgia
Lease: negotiable
Monthly Rent: $Negotiable
Inside Sq. Ft. 4250
Outside Sq. Ft. patio

Price:$0
City:Roswell 

Steve Weinbaum 
(770) 714-4552

The last of the most popular listings for the month was another restaurant space for lease.  This indicates the market is ready with entreprenuers looking to develop their own concept.  This location in Pompany Beach requires less than $20,000 in key month and represents a great opportunity for catering and delivery with an easy to manage 1,200 square feet.
Listing ID:6053 Restaurant Broker Ken Eisenband    
  Restaurant Space for Sale in Pompano Beach is Ideal for Catering & Delivery
Lease: Negotiable
Monthly Rent: $1453
Inside Sq. Ft. 1200
Outside Sq. Ft.

Price:$19,990
City:Pompano Beach 

Ken Eisenband 
(561) 350-3365

The top ten delivered some surprising results this month.  Most of the focus was on independent concepts or restaurant space for lease.  That tells us the marketplace is flourishing with those ready to take the risk on their own concept.  It's also a reversal from many months where we see franchise restaurants for sale drive the results of the top ten. 

Whether you are in the market for your own concept or plan to buy an existing restaurant for sale, check out our many listings online at wesellrestaurants.com or by clcking any of the links on this page. 

Blog Byline Robin

Topics: Buying a Restaurant

Three Rules for Buying a Restaurant Franchise Every Buyer Should Know

Posted by Robin Gagnon on Mar 29, 2018 7:26:16 AM

Every would-be restaurant franchise owner dreams of opening the next big franchise winner but the likelihood is low. Here the Restaurant Brokers advice for getting the best deal when buying a restaurant franchise.

What are the odds of building a successful restaurant from the ground up and lasting three years? According to a hospitality management professor who studied failure rates, it’s less than 40%. A professor at Ohio State University authored a study that found 57% of all newly opened franchises didn’t last beyond 36 months. That’s only slightly better than independent restaurants that experienced a failure rate of 61%.

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Does this mean you should avoid buying a restaurant franchise altogether? No. An open and operating unit for sale represents a great value if you know when to buy and how much to pay. This article lays out the pitfalls of buying a restaurant franchise. Our full series will teach you our three rules for buying a restaurant franchise every buyer should know.

The books and records of an established restaurant franchise for sale are the true picture of its earnings. If you want a business that’s beaten the odds of surviving the three year mark; look at buying a restaurant franchise that’s three years old with repeated years of earnings. If a brand gets your attention because you’re a raving fan, are convinced it’s the next big thing or the food gets high marks, by all means pursue your dream. If you want to pursue that dream while making the most money, the Restaurant Brokers will teach you our “Rule of Three” for buying a Restaurant Franchise.

Here’s the typical story of a new operator. The restaurants brokers have seen this exact scenario hundreds of times. A new owner learns of a concept and is instantly excited about the potential and ready to build from scratch. A new build out for the simplest sandwich concept can easily cost the new operator $350,000 or more. Add in full service, specialized equipment, or a large space and this can quickly top the million dollar mark – before you open the door and make the first dollar.

Eager to experience his success, our hypothetical entrepreneur is sure he’s on the way to making millions. A simple review of the math however shows he’s paying franchise fees of more than 8%, marketing fees of 2%, and rent of 10 - 12% all before he buys the food and serves his first chicken wing and beer at an average check price of $12.00. After that first tough year or so he calls a restaurant broker to ask how much his business is worth. He’s not happy to learn that with a money losing operation, the most he can expect is about 25% of what he’s invested or roughly $125,000. That’s if he has a good franchise concept and a strong site.

A smart restaurant buyer picks up the pieces of the franchise and becomes owner number two. He’s still losing money but he only paid around $100,000 so his cost to acquire is much lower and the debt service is either very low or zero because he paid cash.

Our new entrepreneur is in year two so his sales are beginning to catch up with his fixed costs. By working hard at the business and operating it himself, he can probably go from losing money to making money. By the way, both owners have paid the franchise many thousands of dollars in royalties and marketing fees this entire time even while they lost money.

Another year into the business, this smart buyer realizes he didn’t get such a great deal after all. He’s in the black but when he adds up the time in the business against his return, he’s making less than the federal minimum wage. He calls the restaurant brokers to list the business. Sales have developed to the point that all fixed costs are covered and he’s in the black. With add backs, he’s earning $35,000 or so a year. Priced at three times earnings, it goes on the market for $115,000 and he nets $99,000.

This is when buyer number three steps in and hits his stride on this offering. He gets the deal when he is buying the restaurant franchise. The business is now valued on earnings, not hype. The sales cycle has matured and all costs are covered. Buyer number three has a real opportunity in his hands. He owns a good franchise brand. Sales are still growing and he is operating in the black. Since he didn’t overpay, the cost of repayment is minimal and the business can easily service the debt. While the first two buyers are telling their friends why they would never buy a franchise restaurant, the new owner has never been happier. This business cycle of these restaurant owners demonstrate why you should follow the Restaurant Brokers Rules of Three in Buying Franchise Restaurants.

Rule #1 -- Restaurant buyers never want to be first or second to own. Number three’s the lucky winner.

Rule #2 -- Buy close to the start of year three for the best opportunity. Sales are still trending up and it’s making money. Best of all, there’s still opportunity.

Rule #3 -- Never, ever pay more than three times owner benefit (that’s the amount of earnings plus take home pay for a manager or owner). Hold to that rule no matter how great a pitch you get from the franchise or the owner. Opportunity is a lottery ticket but none of us like the odds.

To see the Restaurant Brokers complete list of franchise restaurants for sale, visit this link online. 

Blog Byline Robin

 

Topics: Buying a Restaurant

Affordable Restaurant Franchises for Sale -- How do they rank? 

Posted by Robin Gagnon on Mar 26, 2018 9:30:36 AM

In the market for a restaurant franchise?  Curious about how much money it takes?   Here's a recap from a recent article in Entreprenuer Magazine on those that require either the smallest amount of capital to launch or the least amount of cash on hand.  The good news -- half of all baby boomers and 16% of Millenials have the nest egg needed to start today!

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The path to business ownership feels a little more secure when you buying a restaurant franchise for sale versus a start up concept.  But how much money do you really need?  You may be thinking, “I can’t afford to become a franchisee, it requires hundreds of thousands to millions of dollars up front to join the brand.” While this is true for franchising giants like Taco Bell who requires $1 million all the way up to $2.5 million to become a franchisee, it is not a reflection of all of the franchises for sale in the restaurant industry. Read on as the Restaurant Brokers break down some of the least expensive franchises for sale.

  • Jimmy John’s – Jimmy John’s is taking the sandwich and sub world by storm due to their delicious menu offerings and their signature “Freaky Fast Delivery Service”, and it’s no wonder their franchises for sale are a hot topic. However, if you think that their popularity means that these franchises for sale are unattainable, think again. The franchise fee is a low $35,000, and you’ll need to prove liquid assets of only $80,000. The magazine Entrepreneur named this franchise as one of the top five best franchises to own, which is no surprise: in 2016 the average Jimmy John’s owner took home nearly $122,000.
  • Ben and Jerry’s – $100,000 is the magic number when it comes to the amount of liquid assets Ben and Jerry’s franchises for sale require to get into the game. You can join this Vermont born brand of franchises for sale for a franchising fee of just $37,000. With fun flavors like Cherry Garcia, Phish Food, Chunky Monkey, who wouldn’t want to dip into this affordable brand of franchises for sale?
  • Cold Stone Creamery – The second brand of frozen decadent treats to make our top five list of most affordable franchises for sale is Cold Stone Creamery. This giant has more than 1,000 locations across the county, as well as locations in 30 other countries! You will need to produce proof of liquid assets in the amount of $100,000 to enter into these franchises for sale opportunities, and come up with the low $27,000 franchise fee.
  • Little Caesars – For over 60 years, Little Caesars franchises for sale have been scooped up by entrepreneurs ready to serve up no fuss carry-out pizza and side items! It’s no surprise that in these six decades more than 4,500 locations have popped up across the globe. Little Caesars requires $100,000 in liquid assets, and if you’re a veteran you will be able to take advantage of the reduced franchise fee! Invest in one of the Little Caesars franchises for sale and you’ll be saying “Pizza, Pizza!” while you roll in the dough!
  • Subway – Subway franchises for sale are king on our list as the brand has locations almost everywhere – over 45,000 locations throughout the world to be specific. This sandwich giant requires $100,000 in liquid assets for new franchisees. Once you purchase one of the Subway franchises for sale, you can expect to join the ranks of the rest of the brands franchisees doing an average sales amount of $490,000 annually!

There you have it, finding affordable franchises for sale CAN be done, and it can be done with worldwide brands!   It looks like the magic number is the hundred thousand dollar mark.  How many people have that much?  A recent Bank of America statistic revealed that even Millennials are beginning to put that much money in the bank.  According to their survey,  "16% now have savings of $100,000 or more, double the amount of young people who had socked away that much in 2015."  Price Waterhouse Cooper says more than 50% of all baby boomers have more than $100,000 set aside.  Are you looking at your savings and ready to invest?  

You an go the route of a new business by purchasing a franchise brand like the ones listed above.  Better yet, you can buy an existing franchise for sale that's already up and running and generating cash flow!  The Restaurant Brokers have an abundance of franchises for sale on our website, including this Subway franchise for sale in beautiful Palm Beach County, Florida or this Ben & Jerry's franchise that's netting six figures toay.  If you’re ready to take the plunge into the franchise world, check out our website by clicking the link below!

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Topics: Buying a Restaurant

Does Selling a Restaurant Require a License? You better believe it - in Many States

Posted by Robin Gagnon on Mar 15, 2018 9:14:33 AM

If you’re selling a house, you know you need a real estate agent.  That means someone who has achieved educational requirements, passed significant testing, undergone a background check and reinvests each year in continuing education. Do you know that in many states, selling a restaurant also requires a license?

It’s true. For sixteen states, it is a specific and certain legal requirement that business brokers or restaurant brokers hold a real estate license. Failure to do so is a Third Degree Felony in the state of Florida and a misdemeanor in Georgia punishable with a fine of $1000 for each violation with each day that person practices as a separate violation.

As of this date, the following states both require a license and have been very consistent in requiring a real estate license in order to sell a business without any real estate. These include: Florida, Georgia, Colorado, California, Washington, Oregon, Nevada, Arizona, Nebraska, Utah, Idaho, Wyoming, South Dakota, Minnesota, Wisconsin and Alaska. In Illinois, the law is slightly different and requires that you register with the Securities Division of the Secretary of State.  That's a total of 17 states with a licensing requirements for business brokers.  In the event that real estate is involved, all fifty states require a license for the transaction to occur legally.

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What are these states hoping to accomplish by requiring a real estate license or other form of licensing for selling a restaurant?

First of all, each license holder is subjected to fingerprinting and a background check. If there are any convictions, clouds or issues arising from the background check, the applicant will not be able to get a license. If you consider that you’re about to spend several hundred thousand dollars at the advice of business broker, is it really such a bad idea to know if they’ve been convicted of fraud first?

Secondly, a real estate licensee is subject to specific educational requirements, including legal and ethics coursework. This education insures that the person holding money and advising you on buying or selling a restaurant understands the legal elements of a contract including, escrow, consideration, buyer and seller acceptance and much more. You would never dream of visiting an unlicensed doctor, why would you put thousands of dollars in the hands of an unlicensed person practicing business brokerage?

Lastly, a real estate license holder is held to specific standards for holding escrow money, advertising listings, the language and content of listings and in some cases, even the legal forms he or she may use for a business.

Each of these items protects the consumer, you, the person buying or selling a restaurant. In the event something goes wrong, the Real Estate Commission in each state has a full complaint and disciplinary process that can result in fines, loss of a license and other sanctions, including, for those operating illegally, criminal charges.

How do you know if your broker has a license to sell your business or help you buy a restaurant? Don’t bother trying to find out on the national listing websites. This restaurant broker did a quick check online and found that in Georgia, fully 50% of the “featured” brokers advertising on BizBuySell did not have a current Georgia real estate license.

The internet has made it incredibly easy to advertise, leading to what I personally believe is the “wild west” mentality where anyone gets listings anywhere. There are no checks and balances on the national listing websites so you will not be able to tell if someone is licensed. For this restaurant broker, who spends an incredible amount of time and money each year complying with educational requirements, paying for licenses and renewal fees and staying current in many states, it is inconceivable that others simply operate in the open without proper licensing. All listings on the We Sell Restaurants website are represented by duly licensed representatives for that state.

How do you confirm a business broker is operating legally? Fortunately, the real estate commission for each state has a simple process where you can verify licensing. I’m including links to each state below. Before you inquire on a listing for sale, take five seconds and confirm the person representing it has the legal right to do so.

What happens if you’re listed with an unlicensed broker? In my opinion, you should immediately terminate the listing. That person has no legal right to represent you and any agreement would be unenforceable in a court of law.

What if you are in contract on a listing with an unlicensed broker? Seek legal counsel. If the broker has mistakenly represented the he or she has the authority to represent your business, you may avoid paying commission. An unlicensed party to a contract making a false claim could easily void any requirement to pay on your behalf.

Lastly, if you discover a broker is unlicensed and representing a listing in a license state, take a moment and report this activity to your real estate commission. There are laws on the books to protect your community and while the real estate commission may not be swift in follow up, they will ultimately investigate any claim you file.

Confirm a real estate license for each state by clicking the link on each state below:

Robin Gagnon is the co-founder of We Sell Restaurants and a licensed real estate agent in Georgia and Florida. She is also an M.B.A. and Certified Restaurant Broker. Her firm represents sellers in forty states and has licensed brokers handling those transactions legally in all states.

 

Topics: Buying a Restaurant, Selling a Restaurant

Ten Most Popular Restaurants for Sale in February Offered by the Restaurant Brokers

Posted by Robin Gagnon on Mar 12, 2018 7:58:02 AM

 

 

February, the month when love is in the air! The We Sell Restaurants website feathing restaurants for sale was feeling the the love! Curious to which restaurants were the most sought after? Be still your heart! We've got the answers. Franchises for sale and Italian restaurants for sale trumped all other categories. What else made it to the top? Read on to find out!

Franchises for sale are always a hit on our website, and February was no different. At the top of the franchises for sale category AND overall is this sandwich franchise for sale in Austin. Wondering what made this one come out on top? Originally priced at just $45,000, the seller dropped the price by $5,000 and is agreeing to pay half of the transferCapture-36.jpg fees!

The second most popular franchise for sale on our website was this Ben & Jerry’s in sunny Florida. There’s no questioning why this listing was so popular – the Ben & Jerry’s name speaks for itself. The owner of this one is scooping up six figures to take home each year as well! Our final franchise for sale in the top 10 is this sandwich franchise for sale in Texas that qualifies for SBA lending. This business is part of a major brand that is well-known and easily recognized! It’s easy to see why these franchises for sale came out on top!

Buyers can’t get enough of our Italian restaurants for sale, and pizza restaurants for sale remain the most popular in this category. At the top of the list was Bella Nonna Gourmet Pizza in Boca Raton – it was so popular that We Sell Restaurants Franchise Partner Ken Eisenband sold it last month as well! Don’t worry, we always have the most Italian restaurants for sale on our website!

Check out this Italian restaurant for sale in Austin with a beautiful build-out. Buyers love this one for it’s beautiful build-out! Rounding out the Italian restaurants for sale category is this pizza restaurant for sale in breathtaking Boynton Beach. This one was on the hot list for buyers in February thanks to the built-in drive-thru window, not to mention the top-notch location!

Valentine’s Day must have been on our buyer’s minds, because this listing for an upscale restaurant for sale was popular last month. Not only is this beauty located in the Sunshine State, but the landlord pays for ALL the building maintenance!

This Greek restaurant for sale on Las Olas garnered the attention of lots of potential buyers! Not only is the build-out flawless, but it also features a 4COP liquor license with a value of almost $150,000.  Restaurant for Sale on Las Olas Blvd. includes 4COP Liquor LicenseSpeaking of liquor licenses, this bar for sale also made the top 10! When buyers see a 100-seat bar for sale with a lease rate that includes utilities, it’s no wonder this piqued their interest!

Rounding out the February 10 most popular restaurants for sale is this restaurant space for sale in Austin. After a $50,000 price reduction, buyers saw that they could steal this one for less than $50,000, AND it’s located in booming north Austin!

There you have it, these were the 10 most loved restaurants for sale on the We Sell Restaurants restaurants for sale website in February. Ready to buy a restaurant for sale for yourself? Click on the link below to be taken to our restaurants for sale website. Thinking now is the time to sell your restaurant? The Restaurant Brokers can help with that, too! Click here to find out more about listing your restaurant for sale!Restaurants for Sale

Topics: Buying a Restaurant, Selling a Restaurant

Top 10 January 2018 Restaurants for Sale

Posted by Robin Gagnon on Feb 16, 2018 1:54:56 PM

We started out the new year with lots of traffic coming through the We Sell Restaurants website. Wondering what the top listings were in January? Pizza restaurants for sale and restaurant spaces for lease were the most popular - three of the top 10 listings were pizza businesses and another three were lease spaces. Have you had your eye on any of these listings? If so, you're clearly not the only one. Don't miss out - contact the Restaurant Brokers and get those offers in on these great restaurants for sale today! Read on for the 10 most popular restaurants for sale in January 2018.

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The most popular listing in January was this pizza restaurant for sale in a highly desirable Miami-Dade County zip code. The new owner can keep the current concept or bring their own. This business is currently serving pizza along with ice cold beer and wine! This business is surrounded by new condominium developments. Did we mention sales are over $1 million annually?

Everyone knows and loves Little Caesars, and this Little Caesars franchise for sale in Wisconsin got a lot of love in January! Little Caesars is the third-largest pizza chain in the United States, and here is your chance to take over this location and roll in the dough. You can't beat it - this take-out only concept mean no dining room and no delivery! Top line sales of almost $550,000 delivers the current owner almost $90,000!

Restaurant Space for Lease Listings Were Definitely Not the Least of Buyers Concerns

This restaurant space for lease is located in Broward County and it's a proven winner. You can't beat this infrastructure that was recently renovated by the landlord - that's mean more money stays in your wallet because most of the work is done for you! This has been brought to code and it's just waiting for a new owner to bring their own concept - any will work! The landlord of this restaurant space for lease is eager to have a new tenant and is open to any and all offers.space.jpeg

The second most popular restaurant space for lease listing in January is located in Roswell, Georgia. If you're looking for something that already has infrastructure in place, this lease space in booming North Fulton County has it all. This area is highly affluent and doesn't shut down when the sun goes down - nightlife is just as popular as daylight hours. This landlord is motivated to sell and is willing to offer tenant improvement assistance to qualified tenants.

The final most popular restaurant space for lease listing for January is located in Duluth, Georgia. This space features a fantastic build out inside a 2,800 square foot building. Bring your concept to this restaurant space for lease and get ready to accommodate up to 125 guests inside! You won't have to worry about where your business will come from as this is located in a nearly 100,000 shopping center anchored by a Publix. This was a former pizza restaurant, and the landlord will offer money for improvements for the right candidate!

Listings for Less Than $100,000 Were Attention Grabbers

This franchise for sale is in the fast-casual sector in booming Kennesaw, Georgia. This one is fully-equipped and ready to go with an outstanding lease rate! This franchise for sale will qualify for an E2 Visa as well as SBA lending. This business is generating sales of almost $200,000 and is on the market for only $35,000!

This restaurant for sale garnered tons of attention last month, and rightfully so. The popularity was partly the result of the massive nearly $200,000 price reduction, and also because this restaurant for sale also includes a food truck in the sale! Keep the current concept or bring your own, don't worry the full commercial kitchen can support whatever you choose. You will save hundreds and thousands of dollars because the build out is already done for you! Bring your offers, this one is on the market for just $99,999.

Hey Coloradoans! This great little sandwich restaurant for sale located in Littleton includes all of the equipment. This is another one where you can keep the current concept or bring your own! Rent is just $2,375/month. Buy this and you're getting a great turnkey location that has a seasoned staff to make the transfer a breeze!

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Check out the numbers this ice cream shop for sale that specializes in gelato is generating - not surprising considering its location. Sales are over $300,000 and the owner is taking home $117,000! Buy this business and you'll stay busy keeping those Floridians cool in the Sunshine State all year long. The sale includes an ice cream maker and pasteurizer that are the finest you can buy!

Rounding out the January Top 10 is this cafe for sale has excellent books and records and has been open and operating for nearly 14 years. Limited hours and an incredible owner benefit of over $280,000 annually makes this the perfect business for a retiree! This cafe for sale is doing almost $1.4 million!

What are you waiting for? These listings are hot and are garnering lots of attention! Don't delay, bring theRestaurant Brokers your offers today! do you have a restaurant you would like to sell? Give us a call at 404-800-6700 and let's talk about what we can do for you!

Restaurants for Sale

Topics: Buying a Restaurant