Selling a Restaurant Business in Ontario
Owning an eatery is a journey—one that most restauranteurs wouldn’t trade for the world. That said, all good things must come to an end. Unfortunately, when the time comes to sell, owners tend to feel (at least a little) overwhelmed.
The good news, if you’ve made your restaurant dreams come true, you’re more than qualified to make a successful sale. All it takes is some help from the right professionals—and a bit of knowledge about how the process works.
If you’re ready to put your business on the market in Ontario, here’s what you should know…
1) You need to think like a buyer
The first step to selling success is putting yourself in someone else’s shoes. Yes, knowing the unique value of your restaurant is part of it. But it also means remembering what it’s like to make a major purchase—and take on all the risk that entails.
How can you lessen a buyer’s biggest concerns? What assurances can you provide? If you have a skilled manager, are they willing to stay on for the transition? A business is a huge purchase—so you should go above and beyond to make sure your prospective buyer will be confident in their decision.
2) You should value your assets carefully
When you’re determining what your business is worth, factoring in all your assets is crucial. In some cases, you may even have to provide a detailed inventory of your company as part of your sale agreement.
Any equipment that will be included should be valued in its current condition, but that’s not all. Your assets also extend to your finances. Buyers will want to know the potential profitability of your business—and having these numbers will help you justify your listing price if need be.
3) It pays to look into your taxes
No doubt about it: the tax implications of selling a restaurant are often complicated. But sometimes, they can also work in your favour. For example, if you’re making a share sale (meaning your entire business is part of the deal, including its name), a lifetime capital gains tax exemption may apply on your first $800,000.
No matter your circumstances, one thing is certain. You want to hold onto as much of your funds as possible. That’s where tax structuring comes in—but the process takes time. Even if you won’t be ready to sell in the immediate future, now is the time to start planning with your accountant.
4) There are more loose ends than you think
Finding a buyer and working through the details of your sale can be challenging, but that’s not all you’ll have to tackle. There are a whole lot of little tasks you’ll need to take care of before you can transfer ownership smoothly—and they can add up quickly.
Cancelling your business number, closing out your payroll accounts, and showing your employees your appreciation are just a few final steps you’ll want to take. By making a list and checking off the boxes, you can make sure nothing is missed.
5) A business broker can help
Selling a restaurant on your own is a very tall order. The strategy, planning, and preparations involved are extensive—and getting it all right requires expertise. Luckily, a business broker who understands the industry can simplify things.
From preparing your eatery for valuation to managing the selling process to working with advisers to reduce your taxes, the right professional can guide you to a successful outcome. Are you ready to take the first step?
Ready to sell your restaurant business in Ontario? Reach out to learn how we can help you simplify the process!
1 Comment
Comments are closed.