Restaurant Resales are HOT right now

Restaurant Resales are HOT regarding buyer’s demand as restaurant sale prices jump 34% in 2021 compared to 2020. BizBuySell’s Insight Report just released its report for Quarter 2 of 2021. Restaurant resale numbers are showing very promising growth and buyer interest. Restaurant resales headline growth as the buyer market seeks reopening opportunities.

Now with restrictions lifted across most industries, buyers are turning to restaurant acquisitions. Restaurants, specifically, was a sector that was drastically affected by the shutdown is coming back strong. While transactions are up 38% over the same time last year at the height of pandemic lockdowns, they are still 16% below Q2 2019 pre-pandemic levels leaving further room for recovery, according to BizBuySell Insight Report.

The restaurant for sale sector sees growth, with restaurant acquisitions up 17% in the second quarter of 2021. In addition to the bounce back in transactions, sale prices increased 34% versus Q1, tied to a 20% increase in median cash flow, according to BizBuySell Insight Report.

Dominique Maddox of EATS Restaurant Brokers says, “Labor Shortage, former employees seeking independence, and restaurant owners seeking retirement are increasing the number of restaurant acquisitions on the market.”

Restaurant Sellers and Restaurant Brokers will be happy to know that restaurants for sale during quarter two of 2021 had 190 median days on the market compared to 219 days quarter two of 2019. This data shows that restaurants are popular when it comes to buyer demand.

Dine-in establishments are expected to increase in market value as restaurant restrictions are lifted in most states. They are at the same time experiencing pressure for the labor shortage. A majority of restaurants have made tough decisions that have included reducing operating hours, closing for days, or going out of business.

The business-for-sale market continued to make gains in the second quarter of 2021, with closed transactions up 5% over the previous quarter. For bargain hunters, this may signal a closing window of the great opportunities made available a year ago, according to BizBuySell’s Insight Report.

For more information on the restaurant market and other available consulting services or a complimentary restaurant valuation, contact Dominique Maddox at 404-993-4448 or by email at sales@eatsbroker.com. Visit our website at www.EATSbroker.com.

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Dominique Maddox of EATS Broker sells Hungry Howie’s Pizza Franchise

Dominique Maddox of EATS Restaurant Brokers sells Hungry Howie’s Pizza . EATS Broker represented the buyer and seller.

The buyer is a Michigan native that was raised on Hungry Howie’s delicious pizza. When the opportunity came available to purchase the Hungry Howie’s Pizza, Mike jumped on the opportunity. The restaurant has been closed since June, Mike has returned from his 4-weeks of corporate training in Michigan and is ready to re-open the business!

The buyer provided EATS Restaurant Brokers with the following Google Review, “ Process was very easy, and each step was explained. I was updated throughout the purchase and communication was great. Very impressed”.

Dominique Maddox of EATS Broker says, “ this transaction was a perfect match! The Hungry Howie’s reminded the buyer of his childhood memories of eating pizza. He saved this business that was recently closed, and now the surrounding community and Kennesaw State University students can enjoy Hungry Howie’s Pizza again”.

 

Dominique Maddox is the President and Founder of EATS Broker and  www.EATSbroker.com, a business brokerage firm specializing exclusively in restaurant franchise resales, restaurants for sale, bars, and nightclubs. After working with one of the nation’s largest restaurant brokerage firms for seven years, Dominique decided it was time to bring a new flavor to the Restaurant Brokerage Industry and founded EATS Broker.

Dominique Maddox has been selling restaurants since 2010 and has undergone intensive training in the Restaurant Brokerage Industry. Dominique attended Morehouse College on a football scholarship, he brings that same competitive spirit and energy to the field of restaurant brokerage.

EATS Restaurant Brokers are Restaurant Resale Specialists that can guide you thru the complex process of buying or selling a restaurant.

Thinking about selling a restaurant contact EATS Broker. For more information on the restaurant market and other available consulting services or restaurant valuations, contact Dominique Maddox at 404-993-4448 or by email at sales@eatsbroker.com. Visit our website at www.EATSbroker.com

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Day in the life of a Restaurant Broker

What does a Restaurant Broker actually do daily? Dominique Maddox Founder and President of EATS Broker shares his thoughts about the Day in the life of a Restaurant Broker.

Restaurant Brokerage is like a BIG secret fraternity where there is limited membership allowed. A large number of people don’t know the responsibilities or tasks a Restaurant Broker has daily. I decided to track my activities on 9/11/2020 in a writing log.

5:15 am – Wake up and put on the 1st pot of coffee and drink water. Review my Cash Scoreboard with my to-do list for the day. Add any items that come to mind.

6:00 am- Arrive at the gym and go beast mode to get ready for the day.

7:15 am- Review closing documents, send reminder emails to buyers and sellers. Send wiring instructions to the closing attorney for all parties.

7:45 am – On the road to take pictures of a restaurant I recently listed for sale. I must arrive before the back of the house staff arrives so they will not be suspicious.

9:00 am- Conduct a conference call between a buyer and seller to discuss add-backs on the Profit and Loss statements, and why the POS sales number are different than Sales Tax Filings numbers.

9:30 am-Start responding to emails in my inbox and following up with the To-Do list for the day.

9:45 am – Call a landlord to discuss the lease assignment for the new tenant. Let the landlord know franchise training will be for 4 weeks, we should be able to close mid-October.

10:00 am -Follow up with a closing attorney that $10,000 buyer escrow has arrived

10:15 am – Review my CASH Report and touch all my pending deals. Start cold-calling for new restaurant seller leads.

11:00 am- Receive a call from a financially qualified candidate. The buyer needs help in understanding the price valuation of the restaurant. The buyer does not understand the definition of add-backs for a price valuation.

11:30 am- Send a potential seller lead a complimentary restaurant valuation. Seller sent a copy of a 2018, 2019, 2020 Profit and Loss statements for review 48 hours earlier.

12:00 am- Receive a call from closing attorney wire disbursements that have been made. I contact all parties expecting a payment to let them know to check their bank accounts for the deposit.

12:00-12:45pm- Mental break. Listen to some R&B, Jazz, and watch some ESPN or stock market show.

12:47-1:05pm- Conversation with a current seller client about buyer activity on his listing.

1:15pm- Receive email from the buyer that requests to see back of the house for a listing I’m advertising for sale. I call the buyer and they don’t want to sign a non-disclosure or show proof of funds.

1:40 pm- Follow up with Hungry Howie’s buyer to get some feedback on how the 4-week training is going.

2:05 pm- An interested buyer requests a copy of our Asset Purchase Agreement to review with the intent to make a formal offer. I draft the Agreement and sent it for review.

2:35 pm – Schedule a meeting between interested buyer and seller at the restaurant for Saturday morning.

2:50pm- Follow up with Papa’s Pizza To Go Area Representative to discuss the training schedule for the approved candidate.

3:10 pm – Review language in a 50-page lease to find out the option renewals, lease expiration date, security deposit, and any prohibited uses.

3:25 pm- Receive a referral from a Financial Advisor. His client has 3 sub sandwich franchises that he wants to sell and is interviewing Restaurant Brokers.

3:27 pm -Followed up with the lead and had a conversation with potential seller lead with 3 sub sandwich franchises.

3:50 pm- Request updated 2020 Profit and Loss statements from all seller clients, to provide buyers with updated numbers.

4:10 pm – Assist buyers with a business plan and give feedback for improvement.

4:25 pm- Read restaurant news related blogs, articles, and restaurant news updates

4:37 pm- Have a conversation with the seller that wants to increase the sales price because they need more money at the closing table.

4:50pm- Send website improvements for www.EATSbroker.com to the website designer to make changes

5:10 pm – Work on restaurant valuation for a potential client

6:15 pm – Conversation with Amaya about Dinner

6:45pm- Online looking for new seller leads and responding to any missed emails.

7:15pm – Start writing a new blog

Restaurant Brokerage is a contact sport, brokers that are uncomfortable with multi-tasking, a challenging career, or demanding clients will not be successful. The life of a Restaurant Broker is to be a Subject Matter Expert in the Restaurant Brokerage Industry.

EATS Restaurant Brokers was formed to bring a new flavor to the Restaurant Brokerage Industry!

Thinking about selling or buying a restaurant contact EATS Broker. For more information on the restaurant market and other available consulting services or restaurant valuations, contact Dominique Maddox at 404-993-4448 or by email at sales@eatsbroker.com. Visit our website at www.EATSbroker.com

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Issues for Business Brokers after Covid-19

EATS Broker attended the Georgia Association of Business Brokers (GABB) Spring Conference last month. The conference was to educated Business Brokers about the issues for Business Brokers conducting sales transactions after Covid-19 depending on if they represent the buyer, seller, or both.

The biggest take-away for EATS Restaurant Brokers was the different issues a Seller’s Brokers should be concerned about vs issues a Buyer’s Brokers would be concerned about.

Dominique Maddox Founder and Restaurant Broker for EATS Restaurant Brokers says, “ over my 8 years of being a Restaurant Broker I have seen a range of issues that affect deals. The majority of my deals I work in a Dual-Agency capacity, this experience has helped me understand both Seller and Buyer Broker needs and wants”.

Working with a trained professional Business Broker or Restaurant Broker can make all the difference of a deal getting closed or terminated. EATS Restaurant Brokers list some issues for Seller’s Broker vs Buyer’s Broker.

Issues for Seller’s Broker:

• Terms of lease-including option years
• What assets are attached to the building
• Security deposit to Landlord
• Security interest to Landlord
• Lease-asset or liability
• What lease exist
• Personal guarantee
• Assignment prohibition
• Franchise issues

Issues for Buyer’s Broker:

• Value of lease to a business
• Insurance Requirements
• Terms of lease-including option years
• What assets are attached to the building
• Security deposit to Landlord
• After-sale liability
• Lease-asset or liability
• What leases exist including amendments
• Personal guarantee
• Assignment prohibition
• Assignment Fee
• SBA lease requirements
• Franchise issues
• Landlord approval requirements

Let us show you how Restaurant Brokerage is done with flavor!

For more information on the restaurant market and other available consulting services or restaurant valuations, contact Dominique Maddox at 404-993-4448 or by email at sales@eatsbroker.com. Visit our website at www.EATSbroker.com

 

 

 

 

 

 

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