Food, Retail & Hospitality · Seller readiness

Selling a Restaurant business

Published · Reviewed by The Diligence Standard Team · Updated

A restaurant owner should prepare clean POS, payroll, vendor and lease data and show the business can operate with management rather than owner heroics.

How the business works

Unit-level sales, labor, food cost, rent, concept durability and management depth drive value. Small changes in prime cost can erase earnings quickly.

Issues to resolve

  • Cash or comped sales are poorly documented
  • Owner role is treated as “free” labor
  • Lease options are short
  • Equipment condition is weak
  • POS and tax returns do not reconcile cleanly

Evidence to request and reconcile

  • POS sales by daypart/channel
  • Payroll and scheduling
  • Vendor purchases and food cost
  • Lease/CAM and options
  • Equipment schedule
  • Delivery-platform reports

Decision questions

  • What does EBITDA look like after replacing the owner’s actual operating role?
  • Are traffic trends improving or is price masking fewer guests?
  • How much equipment CapEx is coming?
  • Can the lease be assigned on acceptable terms?
  • How dependent is the concept on one chef or personality?