In the over 10 years of marketing restaurants for sale we have found that it is more important than ever for us to keep our sellers and brokers up to date on what is going on in the market. Buyer activity in the 4th quarter of 2008 and 1st quarter of 2009 reached an all time low since we’ve been in this business, but in the last few months we have seen a noticeable bump in activity over the first quarter of the year. Specifically buyer registrations and site traffic are more active, and asking prices have moved up on average which is pointing towards some sort of market stability. Additionally our asking price report is showing increased prices over the prior quarter which means sellers are feeling more confident about their businesses. Deals are starting to flow again, however based on our discussions with brokers and sellers it is still tough. The good news is that some transactions are starting to get completed after a 6 month period which we experienced virtually frozen markets.
Restaurant sellers and intermediaries still need to be realistic and patient during this time. You can’t expect to list your restaurant for 1 or 2 months and have it sold. Does it happen sometimes? Yes! We frequently have people that tell us they’ve sold their listing within a few days or weeks, but that is the exception, not the rule. Any restaurant/business for sale website, publication, or broker that claims otherwise is just trying to attract your business. Those are always the best testimonials, and of course for marketing purposes this is what we highlight, and many of the others will as well.
The reality based on our most recent survey, is that a successful sale takes on average 6 to 8 months of aggressive marketing assuming it’s priced right. Does that mean you take out 1 listing with us and keep it on for 6 to 8 months and just expect it to sell? Again, No! Does it happen? Yes. We will tell all of our potential users that you should absolutely be utilizing us as a tool to generate leads as we get some great targeted traffic, and you very well can sell your business through a lead from our site, however, we recommend to all to be aggressive which means maximizing your exposure from multiple websites, publications, broker networking, etc.. If we could sell 100% of our listings you can very well be sure that we’d be charging more that $50 a month for a standard advertisement. The other thing to think about is to not let your ad get tired. Buyers come back to our site frequently and they may have seen your listing during the early part of the year with all the negativity going on in the market, and if you don’t make changes they may overlook it now. Give your listing advertisement the attention it needs to try and get buyers back to being serious.
Restaurants For Sale Online is a great starting point for the selling process and you can very well find a buyer from our site, or a buyer may find you. But, we are not going to tell you that you are going to 100% sell your listing. What we can guarantee is that we will give your listing great online exposure, and give you reach into a targeted audience of buyers and site visitors that are specifically looking for restaurants for sale, and give you an opportunity to be found. We can’t guarantee how many leads you are going to get, and how fast you are going to sell, or if you are going to sell at all. Every listing is very different and like with any real estate transaction it takes all the right things in place for a deal to get done. What we can do, is give your listing great exposure to our targeted audience which may ultimately lead to your restaurant being sold.
8 Tips For Sellers
- Keep your listing Fresh
Give it a look and clean up any typos, change the wording around to make it attractive, and make sure to include all the info you would want to know if you were going to be buying the business. If it is not a confidential sale, nice pictures can go along way in attracting a buyer pool.
- Price Realistically
If you overprice your listing in this market, people aren’t going to think twice. Most buyers want to see an asking price, but if you are afraid of pricing too high or too low talk to an expert.
- Think about Confidentiality
Most owners are sensitive to the confidential nature of a transaction and so don’t usually want people to know their restaurant is for sale. Usually a big reason for this is the owner is worried about losing staff. In this economy, this may not be as big of an issue because unemployment is so high that staff think twice before quitting and trying to find something new.
If you think you are confident that you are priced right, have a solid marketing plan in place for selling your business, and you have spoken with some professional intermediaries that agree, then the only thing left is patience and persistence. Maybe you had a run in with a buyer 6 months back and its time to call them back to see if they have interest now. If you lowered your price you should definitely communicate that with the buyers that have expressed prior interest.
- Run Your Business as If it Wasn’t For Sale
You may want to sell, but it may take a while. If you just put your business on the market be prepared to continue running it for 1 to 2 more years. If you run things as usual and even try and improve your business, you will be putting yourself in a better position to sell your business within the 6 to 8 month period that listings have typically transacted in. Do your best to cut costs where you can without skimping on the important things, and improve profitability. Keep your establishment clean for not only your potential buyers, but customers. Walk into your restaurant with an honest friend as if it were the first time. Both of you look around, and be as critical as you can to assess how you can improve it and then start to make changes.
- Clean up your Financials
Having clean books and proper reporting of sales will go a long way in dealing with buyers and giving you the best value possible. Keep monthly, quarterly and yearly statements for the past 3 years. Don’t wait to have an interested buyer to get this stuff ready. Be prepared to show you are serious.
- Keep the Business Running
Do not shut your doors unless you absolutely have to as this can kill your value and chances of selling. Maybe your profits aren’t what they use to be, but if you can keep your business running, you are likely to get a much better value than if your operation was closed.
- Upgrade Your Marketing Efforts
Now that buyers are coming back now is a good time to invest that extra money in upgrading your listing to a Featured or Spotlight listing on our site, or perhaps trying to add marketing efforts on other websites as well to get you in front of as many potential buyers as possible.
- Remember It Only takes 1!
Sellers need to remember that the quantity of inquiries doesn’t matter. All it takes is 1 serious qualified buyer to get the transaction done, so that next email or phone call might be a moment away.
10. Check Your SPAM Folder
This may sound like a silly one to a lot of you out there, but in today’s world we receive an unbelievable amount of daily communication we don’t want to read. BUT, the average person doesn’t always understand that a SPAM/Junk Email folder is not even close to perfect in terms of how it operates and may legitimate emails can end up there. Make sure you are checking your SPAM folder daily to make sure you don’t miss an inquiry that is serious that somehow ended up there. If you spend 5 minutes a day to do this, you will find that you find at least a couple important thinks a week on average that end up there. If you don’t know how ask your kid, spouse or a friend to show you. Checking a SPAM/Junk Email folder has become an essential daily chore for anyone in business.