Increase your Restaurant’s Value
If you are interested in selling your pub, café, sport’s bar or a fast casual franchise, make an exercise. Ask a restaurant certified broker about what is your restaurant worth. Also you can ask about what do you need to get the most money for your business. Here you will have good advises about those questions. So you will be on-the-run to increase your restaurant’s value.
Another way to value your business comes from high profit margin foods.
What is the SDE
First, it is critical to understand that the best way to increase your restaurant’s value is to show maximum and verifiable “Seller Discretionary Earnings”, also known as SDE. This is a calculation of the total financial benefit that a single full time owner-operator would derive from a business on an annual basis. Also you would have seen it as:
- Adjusted Cash Flow
- Total Owner Benefits
- Seller’s discretionary Cash Flow
- Recast Earnings
But no matter how you call it, it needs to be verifiable!
Increase restaurant's value with additional sales
Additional sales is also an obvious way to increase your restaurant’s value. Given more than 50% of your expenses are fixed, every additional dollar flows strong profits than the bottom line. Look at catering, 3rd party delivery., promotional opportunities to drive top-line revenue. In summary, whether through increased sales or decreased costs, growing earnings is the way to get more from your restaurant.
Good record-keeping
Accurate books and records are equally as critical. If you plan to sell your restaurant in the next few years, start now by making sure your P&L matches your tax returns and POS reports which match your tax filings. Rule of thumb is if you can’t verify or validate revenue, you can’t use it to value your business. That doesn’t mean you can´t pay yourself a salary, or cover legitimate non-operating expenses such as insurance or auto from your business.
Another way to increase your food business value is having a good use of technology tools like to use QR codes in your restaurant.