Optimizing Business Exits
Selling a Restaurant Equipment and Services Business
No one said selling your business in a depressed economy would be easy. Fortunately, a restaurant equipment and services business sale isn't as scary as it seems.
Business sellers are notorious for second-guessing themselves about the right time to put their companies up for sale.
A business sale is always a sophisticated transaction and if you aren't prepared for it, your restaurant equipment and services business sale could have an unexpected outcome. To stay on course, you'll need sound strategy and meticulous execution on your side.
Buyer Concessions
Sellers aren't the only ones who can make concessions in a business sale. In many instances, sellers can request buyer concessions. For example, if the buyer needs seller financing, you can leverage a five-year loan to push for a higher sales price. Although you won't see all of the proceeds upfront, you'll earn interest on the balance and realize a higher price than you would in an all cash deal. Asset exclusions, retained ownership shares and long-term contracts with another of the seller's companies can also be leveraged to extract concessions from buyers.
Timing the Market
Timing is everything when it comes to selling a restaurant equipment and services business. Although the economy is generally struggling, low interest rates make restaurant equipment and services businesses more attractive to entrepreneurs who want to get in the game. As the interest rates rise, it will be more difficult for buyers to make the numbers work in their favor. So we see market timing as a concern that can be easily mitigated by applying fundamental sales strategies and adequately preparing your company for buyers.
Professional Appraisals
There is no substitute for a qualified appraisal in the sale of your restaurant equipment and services business. Leading industry appraisers equip sellers with a value gauge that can be accessed during negotiations. If you're disappointed with the appraiser's estimate of your company's worth, you have the option of seeking a second opinion. However, it's more often the case that you will need to adjust your expectations of your business's value to buyers.
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