Ep. 3 Clean Books for a Clean Restaurant Sale - The Count On It Podcast

Taylor Klummer, a restaurant broker, emphasizes the importance of clean financial records for accurate valuations and successful sales. He shares his personal experience of selling his own restaurant and becoming a broker. The Podcast discusses the role of brokers in providing guidance to restaurant owners and the benefits of buying existing restaurants. Gabby and Klummer highlight the challenges of working with clients who do not have their financial records in order. Overall, the focus is on facilitating smooth transactions and providing accurate valuations for successful restaurant sales.

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[00:00:09.69] - Gabby Parker

Hi. My name is Gabby Parker. And today on Count on It, we have Taylor Klummer with We Sell Restaurants. He's a certified restaurant broker. And maybe you could tell us a little bit about yourself, Taylor.

[00:00:20.69] - Taylor Klummer

Sure. Sure. Well, thank you very much for having me. Gabby and I, we met, basically, through one of these business networking groups Yeah. That I go to here in Nashville. It's called Connect Nashville.. So, yes, I am a certified restaurant broker with the restaurant brokerage firm, We Sell Restaurants. And We Sell Restaurants is the nation's largest restaurant brokerage firm. In twenty twenty three, restaurant sales of all the restaurant sales across the country, our firm was responsible for one out of every five. Wow. So that's about, you know, about twenty percent Yeah. Of all restaurant sales. So, so when you hear restaurant brokerage, it's it's very similar to general business brokerage, but we focus one hundred percent on restaurants, restaurants only. And when you hear restaurants, that's kind of a broad, category. That includes, you know, coffee shops, juice bars, you know, cigar bars, you know, have a, you know, two profitable ice cream franchises for sale. So, you know, it's pretty broad broad category when you hear restaurants. And, because, because we focus on, restaurants only, we're able to get tremendous results for our clients, results meaning, time on market. So we we value businesses and we value restaurants based on their financial results. And, and after that valuation, you know, we list the restaurant and we try and find that one buyer for that, that particular business. And, again but because we we take just such a a focused approach and we don't try and sell a bit of everything, You know, I'm not trying to sell a day care, a gas station, a cleaning company, a landscaping company, a liquor store, and maybe one or two restaurants. A hundred percent of my inventory is restaurants. And so when you take a focused approach like we do, you know, you tend to become, you know, an expert, with with, you know, what what what you're trying to do. Mhmm. And, and that shows, with the results that we get for our clients, results meaning time on market. K. The average time on market for a restaurant to sell is about one year. Okay? So that's data that we collect from, sites like BizBuySell and other, nationwide, brokerage companies.

[00:02:39.30] - Gabby Parker

Mhmm.

[00:02:39.80] - Taylor Klummer

Now the average time on market with all the brokers in our firm is about six months. Okay? So it's about fifty percent faster. So, you know, so again, the it shows in the results that we get, for our clients. And, I've yet to meet a, a client or a restaurant owner that came to me and asked me for help that wanted to own their restaurant for a whole another year. You know? When when when they make the decision to sell, they want it sold, and they want it sold quickly. You know? And I can speak to that, you know, personally, my own experience. I I owned a restaurant in South Florida in, Fort Lauderdale for many years. And, and when I made the decision to sell, you know, I was, I I was tired. I was I was exhausted. You know, it's it's a lot of work that goes into making a restaurant run properly.

[00:03:24.19] - Gabby Parker

The restaurant?

[00:03:24.90] - Taylor Klummer

About three three or four years.

[00:03:26.00] - Gabby Parker

Okay.

[00:03:26.30] - Taylor Klummer

Yeah. Yeah. And, and we were a point of profitability to where I could either hire a manager or consider selling. Mhmm. And, and I had never sold a business before. I did not know how to properly value a business. I mean, how do you go about, you know, selling and listing and, you know, finding the buyer, for for your business. And and what I did was I contacted, the We Sell Restaurants broker that works in Broward and Palm Beach County in South Florida. Mhmm. He came in. He valued my business based on the financial results. He told me what he thought he could sell it for, and, that sounded good to me. Yeah. And, and we listed it. I hired him, and we listed it. And, he brought me a buyer in four weeks. Wow. Not months, weeks.

[00:04:07.80] - Gabby Parker

Wow. Yeah.

[00:04:08.30] - Taylor Klummer

We were under contract, and then we closed about three weeks after that.

[00:04:11.30] - Gabby Parker

Okay.

[00:04:11.69] - Taylor Klummer

And so, so long story short, you know, I ended up investing in the company, and I own a territory here in Middle Tennessee. Mhmm. And, and I have, I have about about ten or eleven listings now.

[00:04:27.69] - Gabby Parker

Okay.

[00:04:28.30] - Taylor Klummer

I have three deals that are under contract. Mhmm. And, the average time, with these three restaurants, that are under contract, the average time that we were listed before we went under under contract was was about five or six weeks. So so it's Yeah. It's the same results. We're getting the same results here, you know, in the middle Tennessee market, in the Nashville market as we do in other parts of the country. And, and our, sellers, these restaurant owners are very grateful that that, you know, we're able to procure and find that one buyer and, and be able to facilitate this deal so that so that they can get the restaurant sold and they can move forward with their life. And then on the other side, we're able to help buyers that are looking for, you know, either profitable, you know, restaurants, and they can come in and and, you know, they're buying the concept, and improvements. Mhmm. Or, we do a lot of what are known as asset sales to where we're just selling the furniture, the fixtures, the equipment, and the lease is gonna be assigned to, the buyer. Okay. But the buyer is just looking for space. They need space to operate their restaurant concept. And, and so we're able to, they're able to buy these these asset sales, which are infinitely cheaper than doing a build out. That's what we help these buyers do because if a buyer is just gonna start with four walls and they're gonna build out a kitchen and build out a restaurant space, you're talking about hundreds and hundreds of thousands, if not millions of dollars. Mhmm. And if I'm able to help a buyer purchase one of these asset sales, you know, for a hundred thousand bucks

[00:06:05.80] - Gabby Parker

Mhmm.

[00:06:06.10] - Taylor Klummer

And it already has You don't have to do a build out and and spend, you know, a year getting, you know, permits and, you know, loans and all these things. You're able to, you know, buy the concept, maybe make some modifications their restaurant, for, an affordable initial investment.

[00:06:39.50] - Gabby Parker

Right. Right. So if I can go back to your your personal experience with your restaurant. You know, when you asked we sell restaurants to come out and value your business, how long did it take to turn around that valuation?

[00:06:51.50] - Taylor Klummer

Well, so, so valuations, it it all depends on how clean the books that we are provided Mhmm. Are. Mhmm. So so being a a CPA myself, you know, my my my books were very clean. You know, I I did my own bookkeeping. You know, I do my own tax returns. So my books are very clean. And, so the broker is able to do the valuation there on the spot and answer any questions. And, you know, we we what we do when we're doing valuations is we we value businesses the same way that SBA lenders value businesses. Okay. And what that is, that's calculating sellers' discretionary earnings Mhmm. Or sellers' discretionary cash flow.

[00:07:36.60] - Gabby Parker

Mhmm.

[00:07:36.80] - Taylor Klummer

And so what that is, you start with, you know, a profit and loss or a tax return with that, net income number or ordinary business income number, And you make, you look for what are known as, add backs, expenses that kind of could be considered, you know, kind of kind of personal or they don't affect the the cash flow of of the business. Okay. So we add back things like, you know, cell phone, travel expenses, meals.

[00:08:02.50] - Gabby Parker

Okay.

[00:08:02.69] - Taylor Klummer

You know, if there's depreciation, amortization, you know, interest expense, things like that. And the more add backs you find that you put on top of that initial net income number Mhmm. The higher that net income number goes, the higher the valuation goes. You know? And once we once we calculate sellers' discretionary earnings, then we apply a a market multiple to that number. And so that market multiple is anywhere from two to three point five. Okay. So in other words, if we calculate sellers' discretionary earnings of, say, a hundred thousand dollars Yeah. You you multiply that number by two to three point five, and you're talking about a range of sales prices from two hundred thousand to about three hundred and fifty thousand dollars.

[00:08:43.70] - Gabby Parker

Okay.

[00:08:44.00] - Taylor Klummer

Right? But as far as the valuation, how long did it take for the broker, that helped me sell my restaurant? Mhmm. My books were clean. He's able to do the valuation immediately. But now with, with what I see often with the books that I'm provided Mhmm. Oftentimes, I I have to kinda see through the numbers that I'm provided, and, and, you know, there will be issues and concerns that that have to be addressed, and you always have questions, about four or five questions about the books that you're provided. And, it's like you and I were were discussing a little while ago. I have to I would much rather do an accurate valuation and address the issues now on the front end so that the value that we're giving this business is is accurate rather than just accepting the numbers that I have. And then when we have a contract in place, and we enter due diligence and the buyer is is, is doing his due diligence, is looking at the tax returns, the profit and loss, the sales tax reports, the POS reports, looking at all those documents to make sure that there's nothing funny going on in the numbers and the valuation is accurate. Well, if there's an issue, it's going to be found by the buyer. And, again, I would rather, you know, have an accurate valuation on the front end rather than discover an issue. And, you know, if it's a big enough issue, it could scare a buyer away, and the buyer could say, hey. You know, this is a major issue. You know, I don't feel comfortable moving forward. Right. Right? So that's what I, so these valuations, is a is a big, big part of my job on the front end first to value the business correctly. And then, you know, and then once we have the valuation done Mhmm. The buyer and I, we have a meeting, and we agree upon the sales price. Right? And once we agree upon that sales price, then they can hire me as their, exclusive listing agent to list the business and try and find that buyer. Buyer.

[00:10:39.50] - Gabby Parker

Okay. Yeah. Mhmm. Yeah. Because in that valuation, you're looking out for both the buyer and the seller Yes. In that you wanna make sure the valuation is high enough for the seller, but then it's a reasonable price for the buyer. So getting that target valuation is very crucial and requires, I'm sure, a lot of data, as much as possible from the seller, and that's up to date, organized, very clean, and easy to read.

[00:11:04.70] - Taylor Klummer

And  an issue, for for example, I have two, profitable ice cream franchises for sale now. Okay. And, it's a listing. It's it's an over six hundred thousand dollar listing. Mhmm. Now most of the times with these more valuable listings, like, not these kind of cheaper asset sales that will sell for, like, a hundred thousand dollars Okay. But, like, these profitable businesses that are making money, obviously, they're gonna command a higher valuation.

[00:11:28.70] - Gabby Parker

Yeah.

[00:11:29.29] - Taylor Klummer

And, with these higher valuations, you know, we get to, you know, four, five hundred thousand dollar sales prices and higher. You know, nine times out of ten, there's gonna be lending involved. Mhmm. Okay? So the buyers are gonna wanna go to a bank, and they're gonna wanna finance a portion of the purchase price. And, like, right now, SBA lenders, are offering twenty percent down and to finance eighty percent of the purchase price. But these banks, they're gonna do the same thing that I'm doing. They're gonna value the business. They're gonna say, okay. Give me prior your tax returns. Yeah. Give me the profit and loss statement, and they're gonna calculate sellers' discretionary earnings. But if I go ahead and I do that legwork, and and I've already done and calculated that number, and I've made the adjustments for any any issues I found, then lending, hopefully, that lending process, it's gonna be expedited. We're not gonna have issues, and we're gonna be able to proceed. But every time, you know, we we run into any issue, like, say, with the valuation or, you know, say we're missing, like, a personal financial statement with the buyer or a consent to credit check or something like that, you know, every delay, you know, can can put your deal in jeopardy. You know? Because as a broker, with what I do, time kills deals. Mhmm. You know? And and if we're we're organized, we have accurate evaluations, you know, the odds of your deal, you know, moving forward and not running in any major issues, you know, go go up tremendously.

[00:12:56.20] - Gabby Parker

Yeah. It sounds like there's a lot of, potential issues or things that could come up. So in the interest of even our audience, like, what would you recommend restaurant owners do in terms of preparation or even lead time? How much time should they give themselves to prepare for this change in their lives and for selling their restaurant?

[00:13:14.70] - Taylor Klummer

Sure. Well, the first thing I'd say is, you know, eighty, ninety percent of what I do is consultation. You know? If if an owner gets the idea, restaurant owner says, hey. You know, I'm even remotely considering selling my business. Mhmm. They'll call me, and we'll come, and I will, explain what their options are.

[00:13:38.89] - Gabby Parker

Okay.

[00:13:39.39] - Taylor Klummer

Okay? When it comes to evaluation, like, is is it a profitable restaurant, or is it not? Okay. Is an asset sale, or is there evaluation involved? And we can apply multiple are explain what their options are Mhmm. Then these restaurant owners can make kind of an informed or educated decision of, yes. I wanna proceed because I like the valuation, and I like the potential sales price. Or maybe, no. You know, I thought it was worth more, and, you know, I wanna keep, you know, operating the business and growing the business and maybe sell later or, you know, any number of, you know, scenarios. But but my point is, if owners it's just like me when I went when I was considering selling my own business, I had never done it before. I did not know, you know, have any idea what the business was actually worth.

[00:14:34.79] - Gabby Parker

Right.

[00:14:35.29] - Taylor Klummer

But then once I had the initial meeting, that initial consultation, then I could say, okay. Well, these are my options. Now I can think through it logically, and I can talk with my partners or with my family, and then I can make the decision what's what's best for me moving forward. And I'll say this again. I keep referring to, you know, the example with myself. You know, the the actual the the first meeting, actually, that I had with, the broker in South Florida Mhmm. It was forward a year and our our business continued to grow, and he came back. And, again, we did the same thing. You know, we did the we had the meeting. I gave him my numbers. We we did the valuation. You know? But that's just an example of, you know, many times these meetings I'll go to, you know, I'll explain the to the owner, and they'll say, well, you know, based on what you told me, you know, I don't wanna sell yet, which is fine. You know? That that that's completely fine with me. Again, you know, you have to do what's best, you know, for you and your life. Mhmm. But but, hopefully, if if I took the time to you know, for the consultation and, you know, explaining their options options and doing the valuation. Hopefully, you know, a year or two down the road when that decision is is made, hopefully, I'll be, you know, top of the list, you know, to, for for the potential, you know, listing, yeah, to to get the listing. So

[00:15:58.00] - Gabby Parker

Yeah. And you have a very specific audience, like restaurant owners in particular. And even you were saying in your experience, you're you were a CPA, so your books were even very clean, ready for that meeting and consultation. Mhmm. These days, while you're working with We Sell Restaurants, about how many of your clients do have their books ready to go when you show up for that consultation?

[00:16:18.20] - Taylor Klummer

Yeah. Let's see. Every now and then, there will be no books. No bookkeeping at all.

[00:16:27.70] - Gabby Parker

Wow.

[00:16:28.20] - Taylor Klummer

So, actually but before I I came here 

[00:16:31.29] - Gabby Parker

That makes me nervous.

[00:16:32.50] - Taylor Klummer

So, actually, but before I came here, a gentleman called me. He owns a, a sushi restaurant, in in Nashville.

[00:16:39.10] - Gabby Parker

Okay.

[00:16:39.50] - Taylor Klummer

And, and, you know, we had a great meeting, and and I asked him, so what what is the state of your your your bookkeeping? He said, well, I don't have any. I said, okay.

[00:16:49.29] - Gabby Parker

And how long has he had the restaurant?

[00:16:51.29] - Taylor Klummer

So so not not more than a year. So so I don't think he's had to file a business tax return yet.

[00:16:55.89] - Gabby Parker

Okay.

[00:16:57.00] - Taylor Klummer

But, you know, obviously, I'm kind of limited in in what I can do as a broker. Right. I can still still sell the space as an asset sale, no books and records. But, you know, if this particular seller, you know, is telling me, hey. You know, I'm making, you know, x amount of dollars every month.

[00:17:13.59] - Gabby Parker

Mhmm.

[00:17:13.79] - Taylor Klummer

So because I'm making all this money, I want this sales price.  I say, well, okay. If you want that sales price, though, and you want me to list your restaurant for sale and try and find a buyer, the first thing the buyer's gonna ask for What happened to that out? The first thing that a buyer is gonna ask for Yeah. Is their books. They say, Show me a profit and loss statement or show me a prior year tax return. They could care less what I tell them what the business is making. They say show me your books. And if you can't show them your books, there's only so much, there's only, you know, a certain price that I'm gonna be able to get them for, for that restaurant space. So, so to answer your question, some don't have books, and that's one of the reasons that, you know, you and I are speaking, you know, now is Yeah. You know, I need, you know, I need a a reliable accounting firm that can help get their books, you know, up to date so that we can, again, revisit the valuation. So I'm sure we'll talk about that later. Mhmm. But then, other, the the the rest of the people, restaurant owners Mhmm. And say say all of them, you know, will have some type of, you know, either bookkeeping or prior tax returns, returns, you know, to provide to me. Mhmm. But, almost everybody, all of the profit and losses that I get, you know, there are issues that that that need to be addressed. You  know, like like we had already already discussed. It's very rare that I would just get a clean, you know, perfect set of books with no with no issues. I'd say that's probably, you know, ten, maybe twenty percent of the, you know, the the the the restaurant owners that that contact me. But Yeah. You know, again, that that's fine. You know? That that's what I'm here for is to do a proper evaluation, and and that's, an advantage that, potential, you know, restaurant or that restaurant owners and potential potential clients have.

[00:19:10.00] - Gabby Parker

Yeah.

[00:19:10.29] - Taylor Klummer

And hiring me as a broker is, you know, they can take confidence in the fact that, you know, I'm I'm bringing, you know, twelve years of, you know, public accounting experience to make sure we get this valuation right, you know, so they can have confidence in the numbers and the range of sales prices that we're talking about.

[00:19:25.29] - Gabby Parker

Yeah. Yeah.  So in in this case, you know, with your restaurant brokerage firm, you're specifically working with restaurant owners who are trying to build, maintain, survive, do whatever they can to make sure their restaurant is still operating and don't have time to work on their books, don't have time to run reports, don't have time to even think about where they're at. Is there cash in the account is their main question.

[00:19:48.59] - Taylor Klummer

Sure.

[00:19:48.90] - Gabby Parker

So that's where somebody like Genovations Accounting could come in, whether it's a cleanup project right before you sell the restaurant or it's a month to month basis, bookkeeping contract where we can go in and enter the data, reconcile the accounts, provide reports to the owner so that they know where they're at, being able to just give them a window into where their financial standing is with their business. And then, you know, when your firm comes in, you can hand them all the reports, profit and loss, balance sheet, sales tax report, so that the valuation can be done, the rush hour can be sold, and we can move forward with the with the agreement.

[00:20:23.29] - Taylor Klummer

Correct. Yeah. You know, a lot of these, you know, business owners or restaurant owners, you know, it's it's their first, their first business that they've owned. You know? One of my, one of my listings right now that we're set to close this week on Friday, the the new owners, they've worked in restaurants, you know, for the last twenty years. But, you know, and so they have all this experience, and they saved up money, and they wanna do something on their own. Mhmm. But, but it's their first business. You know? It's their first business, and it's gonna be their first restaurant. Yeah. And so, you know, new business owners, you know, might not realize, you know, just how important it is to do to keep your books up to date, to not get behind. And oftentimes, too, some of these, you know, new business owners, they'll attempt to do the bookkeeping themselves, which is fine. I mean, depending on the complexity, you know, of your books. I mean, you can try to do them yourself. Mhmm. But, but from from from my point of view and and what I do as a restaurant broker, you know, my hands are gonna kinda be tied behind your back. Mhmm. And there's only gonna be tied behind my back, and there's only, you know, so much I'm gonna be able to do to help you if you don't have up to date books. And so Yeah. You know, that's why I'm, you know, excited about, you know, our, you know, partnership, you know, moving forward so that when I when I do run into these, situations Yeah. And, you know, I had a meeting just before I came here, and that's the exact situation. The bookkeeping is behind.

[00:21:54.20] - Gabby Parker

Right.

[00:21:54.90] - Taylor Klummer

But, you know, this particular restaurant owner wants, you know, this this particular price.

[00:21:59.50] - Gabby Parker

Mhmm.

[00:21:59.79] - Taylor Klummer

And, you know, if if, if he wants to hire me  And to to sell the restaurant and to get that premium price, well, step number one, get your books up to date. Yeah. You know, come come to Genovations accounting, get your books up to date. And then, also, I'm gonna highly recommend, you know, you get into one of these, you know, month to month contracts. So it's a month to month thing. Mhmm. You know, at the end of the month, send in your your bank statements, send in your credit card statements, And, and, you know, you guys, the accounting firm, you know, will will do these. I don't know what your your turnaround time is, but...

[00:22:32.79] - Gabby Parker

Ten days. So by the tenth of the following month, the business owner should have profit and loss balance sheet, accounts receivable, and accounts payable if we track that

[00:22:40.50] - Taylor Klummer

Good.

[00:22:40.79] - Gabby Parker

And the statement of cash flows.

[00:22:42.09] - Taylor Klummer

Excellent. Excellent. Excellent.

[00:22:43.59] - Gabby Parker

Yep. And sales tax filed if needed. 

[00:22:47.00] - Taylor Klummer

Sure. But,

[00:22:47.40] - Gabby Parker

But, yeah, I'm sure that this is even becoming a bigger business for you all because Nashville is growing so quickly, and a lot of people are coming to Nashville to settle, and a lot of people are also starting their own businesses. So you'll have even more restaurant owners coming your way, I'm sure, within the next few years as well.

[00:23:04.50] - Taylor Klummer

Yeah. Yeah. You know, my, my my practice I'm still establishing my my practice. You know? It's, it's gonna be coming up on a a year here, you know, in a month or two. Mhmm. And with with any any new business venture, which which this is for me, that this is a new business venture, and it's, it's actually been a great fit for me because, you know, it's the best of both worlds. I get to use my accounting knowledge, you know, to do these valuations. And then, you know, the fact that I've I've owned a restaurant and kind of speak the restaurant language, that opens up a lot of doors for me. You know? And when I'm meeting, you know, restaurant owners and managers, you know, my whole goal is just to have a have a conversation with somebody, you know, and kinda build up that, that that trust and and that rapport with them so that, you know, in the future, whenever that decision is made potentially sell, you know, again, you you've got that, you know, relationship in place and that contact, you know, there. So, but but yes. Right now, in the Nashville market, it is very much a, a seller's market rather than a buyer's market. A seller's market meaning inventory is low. Mhmm. And, some of these asset sales that, that I'm working on now, I am not shocked. I'm I'm I'm surprised at the the sales price that we're able to to get, you know, the amount that we're able to go under contract for with with these smaller deals because inventory is so low, and the buyers, are looking, you know, for months and months. One of my deals in, in Midtown, the buyer told me, he said, I've been looking for space for six months. Six months. Wow. Every day for six months, and I have not been able to find anything. And this is the very first thing that's, you know, even close to what I'm looking for, the location I'm looking for. And, and, you know, I'll just I'll I'll I'll just mention this, as far as price and asset sales. You know, it's it's normal for us to get, you know, around a hundred thousand dollars for  an asset sale.

[00:25:09.59] - Gabby Parker

Okay.

[00:25:10.09] - Taylor Klummer

And, one of my listings, one of my listings, very, very limited kitchen equipment. You know? I wouldn't say it's fully equipped. I mean, it does have a small hood, but there's not a lot of equipment in there, but we were still able to get, you know, in excess of a hundred thousand for this space. Okay. And, and and same thing there. And, again, these buyers, they're they're they're willing to pay, a premium price Mhmm. Even with with limited kitchen equipment because they're just so desperate to find space to operate. And when something comes up, you know, they have that kind of sense of urgency. They're like, well, there's nothing else available. This is close to what, you know, I'm looking for. Okay. Let's let's move forward.

[00:25:51.40] - Gabby Parker

And the businesses there. There's definitely customers that will come to this restaurant as Nashville continues to

[00:25:57.20] - Taylor Klummer

Yeah. Yeah. Yeah. And and it, you know, it it it depends as far as, you know, the the customer base goes. Mhmm. You know, with with with asset sales, you know, a a a buyer or a new restaurant owner is bringing their own concept to that space. Mhmm. So more than likely, they're gonna buy they're gonna buy the assets. Mhmm. The lease is gonna be assigned to them. And then more than likely, these people, they normally close for a couple of weeks, you know, just to give the space a face lift, to to create the atmosphere and the environment they that they want for their restaurant concept. Okay. And then they'll reopen. But, you know, like another deal that I'm working on, it's a, a sushi and Japanese style restaurant, and the new the new owners that are coming in, they are gonna change a few things with the restaurant, but they're gonna continue to sell sushi. Right? Mhmm. And so the the customer base that is there, you know, this restaurant does a couple hundred thousand in sales, you know, selling sushi. Well, that same customer base is still gonna be there. Mhmm. You know? So they're still gonna be able to take advantage of the customer base that is is there.

[00:27:01.79] - Gabby Parker

Right. Right.

[00:27:02.20] - Taylor Klummer

But, you know, on the other side of that coin, you know, with with profitable restaurant listings, there are a ton of advantages to buying a a profitable restaurant listing. I mean, I know that may seem like common sense, but, you know, when when it comes to opening and operating a restaurant, you know, I'll I'll just provide two different scenarios. First scenario is, say say you're buying an asset sale. You come in, you buy the asset sale, you close a restaurant, you know, for, say, a month or two, and then you reopen. Well, in essence, you know, if it's a brand new concept, you know, you're you're starting at at zero. Yeah. And, you know, normally, with what I see when it comes to restaurants, even my own experience owning my own restaurant, you're talking about two to three years Mhmm. Of operating your your small business, your restaurant, before you, you know, start having positive cash flow, and you're not having to put money back into the business. You know? So, so you can you can go that route, you know, and and you you can certainly go that route. That's what I did, but just understand it it's gonna be a while before you start seeing a return on your investment. Right?

[00:28:09.79] - Gabby Parker

Right.

[00:28:10.20] - Taylor Klummer

Yep. Or you can pay a little bit more money for a profitable restaurant that's making money, and, you know, has, you know, has, you know, several prior years of of income tax returns and has proof, you know, proof of concept and and profitability. And, and, again, you will have to pay for that.

[00:28:29.79] - Gabby Parker

Mhmm.

[00:28:30.09] - Taylor Klummer

But day number one, this the the day that we close on the restaurant, that day belongs to the buyer. Mhmm. Okay? So day number one, we sign sign the contract, the lease assignment is done, you know, and you are officially the new owner of this business, the very first day, you've got cash hitting your bank account

[00:28:49.70] - Gabby Parker

Mhmm.

[00:28:50.09] - Taylor Klummer

From day one. Yeah. And, in the business, it's profitable. It's profitable based on the financial results. And so, you know, so you're gonna be able you're gonna have the reassurance, so to speak, that Yeah. You know, you're you're investing in a successful and profitable business, that you're gonna be able to recoup your investment and Right. And earn, you know, earn money into the future and potentially continue to grow the business and its valuation.

[00:29:16.29] - Gabby Parker

Right. Well, this has been super helpful and informative. I learned some things here. Thanks. So thanks for coming on, Taylor. Sure. We really appreciate having you on Count On It. And, if you're a restaurant owner in Nashville in particular and you're considering or want to just even discuss a potential sale of your restaurant, Taylor with We Sell Restaurants would be a great option. And then, of course, if you're any small business in the Nashville area and you need bookkeeping accounting services Genovations accounting is here to save you time and stress so don't stress your success