Beef ‘O’ Brady franchise restaurant owners often receive quality valuations and sell for fair market value (FMV) to buyers who are intrigued by the investment opportunity. This guide is for Beef ‘O’ Brady’s franchisors who are planning their exit strategy. In this review from an experienced business broker, we discuss the Beef ‘O’ Brady’s franchise, the valuation process, and how to sell your restaurant for fair market value.
About The Beef ‘O’ Brady’s Franchise
Beef ‘O’ Brady’s started as a neighborhood pub where families and friends can gather to watch local and national sporting events or come in to relax after a game. The same vibe remains with Beef O’ Brady’s restaurants. They have an established and trusted reputation within the United States, especially in the southeast where the company originated. There are approximately 118 Beff ‘O’ Brady’s restaurants in the United States.
How Much is My Beef ‘O’ Brady’s Restaurant Worth?
Your broker may use rule of thumb data to begin the valuation process. Also known as industry multiples or acquisition multiples, rule of thumb data reflects the calculated averages of recently sold Beef ‘O’ Brady’s restaurants. Here is the most recent data:
- Beef ‘O’ Brady’s restaurants sold between 2.13 and 2.20 times the Seller’s Discretionary Earnings (SDE)
- Beef ‘O’ Brady’s restaurants sold between 1.85 and 5.59 times the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
- Beef ‘O’ Brady’s restaurants sold between 0.31 and 0.37 times the annual net sales
Your broker will need your SDE and EBITDA to determine your calculation, which they can calculate from your tax returns, profit and loss (P&L) statements, balance sheets, and other financial information. They will also consider the uniqueness of your restaurant, your reputation, location, growth potential, and reason for selling.
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How Do I Sell a Beef ‘O’ Brady’s Restaurant?
The sales process is relatively straightforward, but you can expect unique complexities with every sale as no two are the same. Your broker can help you every step of the way. Most notably, the five steps that take place during the sale of a Beef ‘O’ Brady’s restaurant include:
- The valuation stage
- The planning stage
- The marketing stage
- The due diligence stage
- The closing stage
The Valuation Stage
As discussed, the valuation stage offers an opportunity for Beef ‘O’ Brady’s franchisors to determine their fair market value. This is done with a market-based approach that looks at previous sales data, rule of thumb data (industry multiples), and the specifics of the individual Beef ‘O’ Brady’s restaurant. Your valuation plays a key role in determining your overall strategy, including when you market and your asking price.
The Planning Stage
Selling a Beef ‘O’ Brady’s restaurant is different from other business types since Beef ‘O’ Brady’s is a franchise. This means you have a franchise agreement that may include certain requirements and responsibilities as it pertains to selling. Your broker can assist you with understanding your franchise agreement and ensuring there are no issues with the sale. Additionally, you will also prepare your financial, legal, and operational documents during this stage, such as your tax returns, balance sheets, profit and loss statements, business license, health department inspection reports, and more.
The Marketing Stage
Now, it is time to find a buyer for your Beef ‘O’ Brady’s restaurant. This takes place in a confidential manner. Your broker may utilize private networks, databases, etc. to present your restaurant with hundreds (if not more than a thousand) potential buyers. As necessary, they may also utilize blind listings, non-disclosure agreements, and more to help maintain confidentiality. As offers pour in for your Beef ‘O’ Brady’s restaurant, your broker will explain the details of each offer to you and assist with negotiations and contingency planning. Ultimately, you will narrow your list down and select the buyer that is the most qualified and has the approval of Beef ‘O’ Brady’s to take over operations at your location.
The Due Diligence Stage
Although it would be nice to move straight to closing right after securing a letter of intent (LOI) to purchase your Beef ‘O’ Brady’s restaurant, the buyer must have time to complete due diligence. This stage involves a detailed review by the buyer and their attorney of the seller’s financial and legal documents. They may also ask a series of questions to learn more and clarify information they find in your documents. In some cases, the buyer may even want to visit your Beef ‘O’ Brady’s restaurant. While this is important for the buyer, the process should remain structured and organized so that both parties can move to close the sale without delay.
The Closing Stage
First, you need to set a date for closing. This needs to be at a time that you, the buyer, and your respective attorneys can all attend, along with anyone else who may attend the closing. (In some cases, the broker may attend). During closing, the following will take place:
- The attorneys review the purchase agreement and any additional documents that are relevant to the sale
- The buyer and the seller sign the purchase agreement
- The buyer sends the payment to the seller, and the seller confirms the transaction (in some cases, this may involve a financial institution if the buyer finances the deal
- The seller notifies Beef ‘O’ Brady’s that the transaction is complete
- The seller transfers ownership of the restaurant to the buyer
- The seller notifies employees of the change in ownership
- The seller may assist with the day-to-day transitions to ensure a smooth transfer process
Contact Our Business Brokerage for a No-Cost, No-Obligation Valuation
Here at Sigma Mergers and Acquisitions, it is our passion to help owners sell their restaurants at or above fair market value. We also take pride in ensuring a stress-free and structured process that prioritizes efficiency and minimizes the risk of setbacks. We encourage you to reach out today for more information and to get started with a free professional valuation.
Scot Cockroft is the Owner & President of the #1 ranked Business Brokerage, Business sales and M&A firm in Texas. Scot has been named Named Deal Maker of the Year by Dallas Business Journal.
He is committed to a “different” type of business brokerage firm, one that is NOT about a sales pitch but, rather, results! In short, a business brokerage firm that is committed to performance-based compensation. Scot believes in these principles as well as a candid honesty with clients. His candid style often takes buyers and sellers by surprise, but is often what assures successful connections between the two.
Feel free to reach out!