Questions Buyers Ask

When a prospective buyer is considering the purchase of a restaurant or other food service business, this list is a compilation of most of the questions that may be asked and will impact the offer that is made to buy it. The list is in no specific order of importance.

  • Will the owner offer financing?
  • Will the owner provide training?
  • Will the owner sign a non-compete agreement and for how many miles?
  • Is the lease assignable, is there a renewal option, any restrictions?
  • Are the trade name, Web site, recipes and training manuals included in the deal?
  • How many hours a week does the owner work?
  • What is the real reason for the sale?
  • How long since menu / price change?
  • Are the most recent health inspection reports available?
  • Is the equipment owned or leased?
  • Is the equipment in good and working condition?
  • Will the chef / cook stay?
  • Where is the labor pool?
  • Who are key suppliers?
  • What is the demographic base?
  • Are there any governmental issues, including city and health departments?
  • Has the owner experimented with different hours (breakfast, lunch, dinner, weekend brunch, late night entertainment)?
  • Any liquor license violations or restrictions?
  • Is there any current competition or any coming to the area soon?
  • Is verifiable financial information available?
  • Blend of sales food/liquor?
  • Is there any cash payroll?
  • Is the POS computer connected to the corporate headquarters or franchise?
  • How long has the seller owned the business?
  • What are the operating hours? Buyers want to determine if there may be room for increasing sales based on changing the hours.
  • Work histories of staff?
  • Suggestions for growth or expansion?
  • Are the federal, state and payroll taxes current and does the family have non essential employees on the payroll?
  • Are sales taxes and gratuities being included in the sales? Some accountants will permit the operator to do that, then remove them as an expense.
  • Do you have a gift-card program?
  • How much of your income is in cash?
  • What type of marketing has and has not worked?
  • What part of the business needs the most improvement?
  • What do online social media reviews look like?