It can be a scary thing to leave the business you poured your heart and soul into. When it's time to retire, cash out, or you are just ready to move one, how do you find the right buyer to sell your restaurant to? You can ease your anxieties with a few tips from the restaurant brokers on how to find a qualified buyer for your restaurant. Keep reading to learn more about how to find the right buyer when Selling a Restaurant.
Who is a Qualified Buyer?
At minimum, a qualified buyer is someone who understands the ownership role, has proof of funds, and is interested in your restaurant business. Ideally, they would have previous restaurant or business experience, but do not necessarily close the door to inquiring buyers looking to own their very first restaurant. These new business owners bring vigor and passion to the table and are energized to handle the challenges of restaurant ownership. Deciding between an experienced restaurant owner and first-time owner will depend on the type of restaurant business you are selling. A franchise restaurant, for instance, will likely have more requirements set forth from the brand itself that limit who can purchase the business from you.
Understand the Restaurant Ownership Role
The best buyer for your restaurant may not necessarily be the first person who places an offer. Depending on your business's concept and operations, it's important to outline who an ideal owner is.
- How many hours do they work?
- What previous restaurant experience do they have?
- Are they absentee/semi-absentee or an owner/operator?
- Do they live locally?
Part of attracting the right buyer is advertising the business to buyers who are interested in the restaurant ownership role required for the operations to be successful. For instance, a profitable franchise restaurant with a manager and staff in pace may be suitable for the buyer looking for an absentee or semi-absentee opportunity. In this scenario, a buyer seeking an absentee opportunity would not be the right buyer for an independent restaurant whose owner currently works in store 50 hours a week. Brainstorm the ideal restaurant ownership role upfront to attract the right buyer in the process of selling your restaurant.
Proof of Funds
The ideal buyer should demonstrate they can financially support their restaurant venture and ensure its continuity. This can be achieved through asking for proof of funds. Proof of funds simply asks an inquiring buyer to provide a bank statement, broker statement, bank letter, or other form of documentation to show that they have access to a certain amount of capital. The proof of funds requirement varies brand to brand and restaurant to restaurant. The last thing you, as an owner, want is to get to closing day only to learn that the buyer you spent energy on doesn't actually have the money to purchase the business. This could mean weeks of wasted time in the process of selling your restaurant.
Restaurants owners who sell their restaurant with We Sell Restaurants trust the Certified Restaurant Broker® to obtain proof of funds from buyers who make an offer on the business, saving time and money in the process. If the proof of funds is not a pre-qualification, then it should always be obtained when the buyer places an offer.
Market your restaurant for sale in the right places
Selling a restaurant is not the same as selling a house, since you don't want everyone and their mother knowing that the business is for sale. Employees, managers, and local customers might be uneasy with the news and negatively affect business operations in the months that you are trying to sell. How do you market and sell a restaurant without alerting the whole neighborhood that it's for sale? You can advertise your restaurant without its name or address online, but that alone could take more time than you can afford, especially if you need to sell quick. A strong restaurant broker will have a process for advertising your restaurant that protects its identity. They have the industry knowledge to write effective headlines that attract buyers using only general location and concept information. From there, they should have an existing network of potential buyers who are already looking for businesses to purchase.
Another place to advertise your restaurant is through an aggregate website where businesses for sale are listed daily. Although, your restaurant may be lost to a sea of thousands of businesses that are posted if you don't use the platform effectively. An experienced restaurant broker comes in handy here because they know how to efficiently write your restaurant's listing and follow up with buyers who inquire through other websites.
Restaurant owners who list their restaurant with We Sell Restaurants receive the benefit of proven marketing strategy from an all-restaurant brokerage.
Employ a restaurant broker to screen inquiries
Finding the right buyer when you are selling a restaurant can be a very time-consuming process, especially when you are still running your restaurant business. That's why a restaurant broker is an invaluable asset to the restaurant owner. A Certified Restaurant Broker®, for example, specializes in restaurant sales and is equipped with the knowledge and resources required to properly vet potential buyers. They can also be a resource for negotiating and closing a deal.
When you’re ready to take the plunge and sell your restaurant, remember these tips for finding a qualified buyer. Restaurant owners thinking about selling can schedule a free, no obligation restaurant evaluation call with a Certified Restaurant Broker® to learn more about their restaurant's value on the market today.
Robin Gagnon, Certified Restaurant Broker®, MBA, CBI, CFE is the co-founder of We Sell Restaurants and industry expert in restaurant sales and valuation. Named by Nation’s Restaurant News as one of the “Most Influential Suppliers and Vendors” to the restaurant industry, her articles and expertise appear nationwide in QSR Magazine, Franchising World, Forbes, Yahoo Finance, and BizBuySell. She is the co-author of Appetite for Acquisition, an award-winning book on buying restaurants.