When you start your own restaurant, you will be spending a lot of time in research, planning, design and developing your concept.
You will need to find a location, purchase equipment, set up vendors and get licenses and permits. An existing restaurant already has this in place. We have listed some pros and cons for each below.
Pros:
Buying an existing business takes less time and effort than starting one.
You may have staff in place and already trained.
You have an existing sales record and you can evaluate your growth.
You already have a customer base so you have less risk.
If the seller is burned out, you can usually buy for less.
You will have an immediate cash flow.
Cons:
You will need to find out why the seller is selling. This may be because of a bad lease, bad equipment, road work, incompetent staff, or inaccurate bookkeeping.
You will need to make sure all past tax obligations are in order and current.
There are no guarantees the business will continue to be profitable.
The business may have a bad reputation that may take a year or more to overcome.
Tips For Buying:
Ask why is the owner looking to get out of the business. Review the books for the current year, and at least the previous five years.
Find out the tax liabilities for this establishment.
Check the records with the local board of health, liquor control, and any other regulating agencies that have recently visited this establishment.
Employee turnover.
Management competency.
Cleanliness of the establishment.
What are the recent improvements, or changes that may have affected the quality of the food, service, or atmosphere?
Articles
Restaurant Values.com - Eight Rules For Buying A Restaurant - So you want to BUY a Restaurant? There are eight tasks or rules that need to be followed to successfully buy a Restaurant.
Restaurant Store.com - Whether you retain the current concept or create a new one, you can greatly reduce your cash investment and lower your risk by purchasing an operating food-service business with an established customer base and proven cash flow.
The Gulottalaw.com - There may be many reasons for buying an existing restaurant, as opposed to starting a new venture. The most obvious benefits are the existing restaurant’s track record and its location.
Links
Restaurants For Sale.com - Unlike other Business Brokers, we specialize in just one thing - - -Food and Food allied businesses. We've been around for 15 years andare recognized as the LEADER in this highly specialized field.
Restaurants For Sale - Find restaurants for sale in many states. Our role is connecting sellers, buyers and brokers/agent. All subsequent negotiation will be made between you and the other party. For these reasons, we strongly recommend that you consult a professional before committing yourself to any purchase/sale.
restaurantforsale.us - Buy or Sell a Restaurant, Food & Restaurant Businesses & Restaurant Franchises
restaurants-fsbo.com - searchable national listings of restaurants for sale by owner
Business Nation - Small Business Center: Small business and startup information, resources for entrepreneurs, business articles and forms search engine, business and franchise opportunities, businesses for sale listings, business services, barters, expert advice, office and retail space rental directories, business and industry news, suggested business books, reviews and discussion forums
