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This ten step questionnaire will help you define what you want and more importantly, what fits your lifestyle before you go on the search for the perfect restaurant. This is vital to the buying process and the step that most buyers overlook. Prepare first, since once you being to make inquiries, multiple opportunities will surface. It's also important to do your homework up front since you can't be taken seriously when you inquire about everything from $55,000 asset sales to $2.5 Million dollar waterfront properties with real estate.1) The answer to this question lies with whether you need an immediate income (in which case only the first answer is an option for you) or whether you have the capital (and risk tolerance) to invest and building earnings over time. Consider that it will take between 18-24 months for a GOOD operator to perform a turn around or begin seeing profit from a start up so plan accordingly.I am interested in:a) An operating restaurant - profitableb) A turnaround situationc) A closed restaurantd) Franchise Restaurantse) New Space2) The answer to this question lies within your financial situation. Landlords will require both good credit and a personal guarantee on the lease in most cases. If you plan to lease and don't have both, you may want to consider something with real estate so you can leverage the purchase of the real property with a lender. If you're purchasing real estate to convert, it's going to take a lot of capitalI am interested ina) Restaurant and Real Estateb) Restaurant Only - with Leasec) Real Estate Only - I'll convert3) The answer to this question may lie with your background or experience. You may also have personal values or other criteria which would stop you from looking at certain concepts.I am interested ina) Upscale/Fine Dining Restaurantb) Bar-B-Que Restaurantc) Pizza Restaurantd) Italian Restaurante) Sports Bar Restaurantf) Asian Restaurantg) Deli/Sandwich Restauranth) Franchise RestaurantI) Take Out/Delivery Only Restaurant4) The higher the net income of a restaurant (which typically sells for 2- 2.5 times earnings, the higher the purchase price. What you can afford will drive the answer to the following question.I am interested in1) Earnings of under $50,0002) Earnings of between $50,000 and $100,0003) Earnings above $100,0005) The answer to the following question is straightforward. It may be very relevant to an owner that may finance a portion of the purchase or landlords and lenders who may turn away candidates without background and experience.I do have or I do not have Restaurant Experience6) This question affects your future lifestyle and time with your family. It's a good one to discuss with other family members before you begin looking at sports bars open until 2am each night.I prefer a restaurant that isa) Open any hoursb) Open until early Evening (11pm)c) Open Late Night/Early morning hours (2am)d) Open for breakfast and lunch only7) The highest profit margin in a restaurant is made on alcohol sales so the alcohol ratio will drive the net profit on a business up or down depending on how much is served. Local and state restrictions on the type of alcohol licenses generally dictate a ratio. The answer to this question is NO alcohol if you have a felony conviction in your background as you will not qualify for a liquor license in most states.The most desirable alcohol ratio for me is:a) Low to No Alcohol/High Foodb) Mid Alcohol/Mid Foodc) High Alcohol (bar levels)/Low Foodd) No Alcohol8) This is a good place to try and take a break and articulate to yourself or another person why you are motivated to buy a restaurant. The answer may determine whether you continue on this quest or decide on another type of business.My motivating factor to buy a restaurant isa) Investment/Money making potentialb) Restaurant Experienced/now I want my own placec) Seems like a good idead) I'm not sure9) This question is incredibly important in major metro areas. Decide up front how far you will travel or if you will move to acquire the right restaurant. Changing your children's school is a family decision. The right business in the wrong location may not be an option for you.When it comes to finding a restaurant, these are my criteria from my current homea) I am willing to travel _________ miles from my current home to my businessb) I am willing to move _________ miles from my current home to my business10) The last question to ask yourself before you go shopping is what you can afford. You wouldn't shop for a house without a pre-approval or a budget and you shouldn't start shopping for a restaurant without the same. Who's paying for the business? Will you need financing? Are you looking for owner financing?My financing plan is:a) I will not require financing or capitalb) I have loans or investors secured up to __________c) I need the owner to finance ____% or $______ but I can find $__________ to put downIf you seriously consider all ten of these questions before you buy a restaurant, you will be equipped to meet sellers and brokers with a clear strategy for your own success.Visit our listings online at www.wesellrestaurants.comFollow We Sell Restaurants on Twitter at www.twitter.com/sellrestaurantsVisit our online blog at www.wesellrestaurants.com/blogspot
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