Buying a restaurant is a big step that requires a lot of planning, brainstorming, research and finding the right people to help you along the way. You may have accountants, legal experts, and financial planners on hand but a restaurant broker can connect the missing pieces. They're someone who’ll guide you along the complex process of finding the right restaurant, negotiating, closing the deal, and also staying in touch afterwards. Your relationship with your broker is such an important one that you need to invest some time in researching and finding the right broker before you even start looking around for a restaurant to buy. Here are 5 tips on how to find the right restaurant broker:
Asking the Right Questions
Hiring the right broker is not easy. Every broker can talk the talk but can they walk the walk? You want to find out early on about their background, experience, their track records and how big their network is. This requires you to ask the right questions of each broker your interview. This is an important job for them even if it’s a one time off thing. You’re sinking a lot of money in this business venture and you need to have the right people beside you to make it happen. Shortcuts have no place in this project and you don’t need someone who lacks the experience to handle this for you. After all, they're supposed to make things easier not harder!
The Right Broker with the Best Credentials
So what should you look for when you interview potential brokers? For one thing, the perfect broker would have wide access to a lot of properties for sale and/or lease. Without that access, your broker would need another broker and that’s not acceptable. And since restaurants are different from other businesses and properties, the broker should have good experience in this niche. Namely, buying and selling restaurants. There are a lot of moving parts and a broker who hasn’t done this before would not be able to offer their help or foresee potential problems in a certain restaurant location or property.
A restaurant broker worth their salt would also have good experience with the legal side of the venture. Not only would they know enough about legal contracts but also be able to cut through the legal jargon and complex contractual clauses to make sure the contract you sign doesn’t have a clause that is not in your favor. The broker would suggest how to make a contract airtight and protects you against any liability. Of course you’d need to hire a lawyer for that but having a broker who understands the legal side will come in handy when the lawyer is not present.
Why Networking is Important
Let’s face it, a broker who doesn’t have a big network that covers a big swath of the city has no business being a broker. It’s not just about knowing all the properties in the market but finding the one place or restaurant that fits your budget. In most cases your budget will have the final word deciding not just where your restaurant will be, but how large or small it will be. So if your broker only has access to properties that are way above your budget they won’t be of much help finding the right place for you. Make sure you and the broker are on the same page when it comes to your budget.
A good broker always stays in touch with you even after the deal has been closed and you’re now the proud owner of a new restaurant. This actually works both ways. It’s good for you to keep in contact with someone who’s been by your side all the time it took you to find, negotiate and sign the contract for your restaurant. You might need their help later when you decide to open another restaurant. At the same time the broker knows that a successful deal will fit nicely on their resume and they can get more business through you down the road.
Ultimately, if you land the right restaurant broker for your restaurant type with extensive research, you'll find a quality partner that'll be worth all the time you spent!