The past few years have tested the will of many restaurant owners who managed to make it through the pandemic but have struggled with economic headwinds ever since. If you’re looking to sell your restaurant business, you’ll need to organize many of the same items mentioned above that can help you secure financing. But it’s also important to review the expenses you have accrued in the business and translate them into benefits that have value to a new owner.
Robin Gagnon, cofounder and CEO of We Sell Restaurants, explained in a recent episode of the Restaurant Rockstars podcast that her role as a broker is basically the inverse of what a CPA does. Instead of looking for expenses to legally deduct, she’s identifying expenses that bring value to a restaurant business and can be added back in to boost the value of the operation to a buyer.
While you might review your your tax returns and be disheartened if you see negative earnings, working with a broker can help you view that information through a different lens. By aggregating the seller’s discretionary earnings, or the amount of actual value you receive as an owner from such expenses as insurance, mobile phones, and employee bonuses and incentives, you can uncover the value that a buyer is gaining through the sale — value they might use themselves to free up cash and restructure the business.