1 min read

Buying a Restaurant in Atlanta, Georgia

Buying a Restaurant in Atlanta, Georgia

As you probably know, owning a restaurant is one of the most risky business endeavors one can take. That’s why when you’re searching for one to buy, it’s vital that you know exactly how to find the best ones at the most reasonable prices.

Income Valuation

The restaurant industry fixes the price of a restaurant through one of a few different ways, but the “income valuation approach” tends to be the most standard and effective – your Atlanta business brokerage firm ought to be extremely familiar with this method. A restaurant with profit/loss statements valued with the “income valuation approach,” usually has the most attraction for people buying a business in georgia (particular restaurants).

With proof of income, a restaurant buyer in Atlanta could ideally purchase a restaurant with around twenty percent down, and receive a small business administration secured loan for the balance. All in all, the income valuation approach is the best way for buyers to figure out how much they should pay for their restaurant.

Pricing a Restaurant For Sale in Georgia

Atlanta business brokers tend to list a restaurant at a price that’s based on “potential earnings,” or what a new owner could make, if he/she ran the business better, but this isn’t right. The earnings that come from “better operation” go to the business buyer as a bonus, but can’t be added into the earnings. Add-back calculations tend to serve only one purpose, and that’s to determine price a the restaurant for sale.  It only makes sense that the seller not be paid for benefit they themselves didn’t establish.

Seller Discretionary Earnings

These are used as a base to multiply in deciding on the price for the restaurant. For example, restaurants in Atlanta for sale trading around 2-3 times earnings. Factors effecting the multiple are varied, including:

Is it a franchise restaurant?
How consistent is the profits/losses with regard to the time of year and location?

Top 7 Reasons Why Businesses are Sold | Sunbelt Blog

3 min read

Top 7 Reasons Why Businesses are Sold | Sunbelt Blog

When you’re faced with an interested buyer, you ought to be prepared to answer the most obvious question: “why are you selling your business?”...

Read More
Ask Your Atlanta Business Brokers These 5 Questions First

3 min read

Ask Your Atlanta Business Brokers These 5 Questions First

The decision to hire an M&A advisor is an important one, not something to rush. You’ll likely only sell a business once, and the effects of that sale...

Read More
6 Important Questions to Ask Your Business Broker

3 min read

6 Important Questions to Ask Your Business Broker

There is no doubt that a business broker will ask you a whole slew of questions when he or she finds out that you’re interested in selling...

Read More