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Restaurants for sale
26/08/2009
If you have considered buying an existing restaurant, you have undoubtedly spent hours poring over lists of restaurants for sale. But if you�re just examining list prices and average annual revenues, you may be headed for disaster. The following tips will get you around some common mistakes buyers make when purchasing a restaurant currently in operation.

It should first be mentioned that buying one of the many existing restaurants for sale can be an exceptionally smart move-- if done correctly.  When you buy a restaurant already in operation, you also acquire equipment and other infrastructure, recipes, staff, and, of course, a customer base.  By contrast, new restaurants-- even locations of popular nationwide franchises-- often have a ramp-up period of a year or more.

The number and type of restaurants for sale (and your odds for success) can vary greatly depending on location and current market trends.  As always, the real estate maxim of �location, location, location� applies.  Maybe you�re considering buying a casual dining restaurant close to a prosperous area, but even closer to an economically depressed sector.  Is that vibrant area growing and expected to continue doing so?  If so, one of those restaurants for sale could prove to be lucrative.  But gauge growth wrong, and you could miss out on the traffic you need to survive.

Restaurants for sale also come with a track record.  And while a seller can�t offer past performance as a guarantee of future profits, accurate (and make sure they�re accurate) records can help you form a best/worst case scenario.  From there, you can determine your own individual risk tolerance.  But, in this context, don�t forget to allow for emerging trends.  Among the current restaurants for sale, are you considering buying an upscale casual dining restaurant?  Could the rapid growth of fast-casual dining restaurants take a bite out your potential customer base?  How about the successful burger restaurant you�re thinking about purchasing? Could the restaurant�s lack of healthier menu items be problematic given the trend toward healthier dining options?  When weighing your choices among the numerous restaurants for sale, consider verified past performance, but make sure to factor in where the market is headed.

You will also need to do your homework in answering a host of questions when examining restaurants for sale.  Why is the owner selling?  Have there been any recent events that could have harmed the restaurant�s reputation?  Does the restaurant have any outstanding tax liabilities?  Is all equipment in good working order (now is the time to find out that the restaurant�s $10,000 deep fryer is on its last legs)?

Buying one of the many existing restaurants for sale involves much more than price shopping.  The savvy buyer must examine emerging and anticipated trends in real estate and consumers tastes.  The buyer must also examine and verify the restaurant�s past performance and answer an array of other important questions.  By taking care to follow these steps, you can enjoy the advantages of restaurant ownership without the downside of buying a new restaurant.   

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(Theo quantifiedmarketing.com)

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