How to Sell a Wine and Beer Tavern

Sell a Wine and Beer Tavern

Although it may at first seem like an overwhelming process, the sale of your wine and beer tavern does not have to stress. This guide helps you prepare your exit strategy by discussing the valuation and sale process for wine and beer taverns. 

About Wine and Beer Taverns

The wine and beer tavern industry engage in the sale of alcoholic beverages for consumption within their establishment. This is usually considered a place of drinking and nightlife. Food is often offered but may be more limited than other establishment types (i.e. bars or pubs). Wine and beer taverns are considered different from brew pubs, although the two business models are often confused. There are separate licenses for each type in most states.

How to Value a Wine and Beer Tavern

The first step to any exit strategy is determining how much your wine and beer tavern is worth on the market. That is to say, you want to determine your fair market value (FMV) — the amount prospective buyers are most likely going to offer. You can determine your valuation with a market approach, which considers metrics such as your seller’s discretionary earnings (SDE) and rule of thumb data (also known as industry multiples). Here is the rule of thumb data for the wine and beer tavern industry

  • Wine and beer taverns sold between 2.13 and 2.20 times the Seller’s Discretionary Earnings (SDE)
  • Wine and beer taverns sold between 1.85 and 5.59 times the Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
  • Wine and beer taverns sold between 0.31 and 0.96 times the annual net sales

You should also check: How to Sell a Bottled Water Production Company

How to Sell a Wine and Beer Tavern

You can sell your wine and beer tavern by following a structured process and working with a qualified and experienced business broker who understands your industry. The most notable steps you can expect include: 

  1. Determine your sales strategy
  2. Collect the documents you need for the sale
  3. Find a qualified buyer for your wine and beer tavern
  4. Provide an opportunity for due diligence
  5. Close the sale and transfer ownership

 

Your experience and timeline may look slightly different than the standard process presented below. We recommend speaking with a business broker about the specifics of your wine and beer tavern to ensure a personalized strategy that works. 

Determine Your Sales Strategy

After you receive your valuation, you should determine when (and for how much) you sell your wine and beer tavern. Of course, the primary goal might be to maximize the sale price. However, you may have other goals that you should establish during this first step, such as finding a buyer that keeps your employees and continues the work you started within the community. Your broker can help you establish your sales approach. 

Collect The Documents You Need for The Sale

It is best to prepare your documents before the marketing phase. Otherwise, you could run into snags along the way that delay the process and cause prospective buyers to back out of offers, negotiations, and LOIs. The most notable documents you need to gather include (but may not be limited to) your tax returns and other financial statements, business license (and other operational licenses), and your insurance and lease policies. 

Find a Qualified Buyer for Your Wine and Beer Tavern

This step is where your business broker shines and makes your life much easier. It is nearly impossible to maintain the confidentiality of the sale if you try and sell on your own. Experienced business brokers have deep connections and access to databases and networks that they can leverage to bring your wine and beer tavern’s sales memorandum in front of hundreds of prospective buyers. They also understand how to use blind listings, NDAs, and other strategies to ensure news of your sale is not leaked. Ultimately, this step ends with a qualified buyer signing a letter of intent (LOI). Of course, negotiations, contingency discussions, and more take place during this step of the sales process as well. 

Provide an Opportunity for Due Diligence

The buyer must provide the seller with an opportunity to review the business details and ensure they are comfortable moving forward with the purchase. This stage is known as due diligence. Your broker is there to help ensure the process moves quickly. You will need to provide legal and financial documents, such as those discussed above.

Close The Sale and Transfer Ownership

The sale closing is the final step, but before you celebrate, there is still some work to do. There are certain documents you must bring with you to closing, such as a copy of the purchase agreement, insurance policy, and other legal information you will need to transfer ownership. Your broker and attorney can assist you with ensuring you are fully prepared. You will also notify employees (and customers) that there is new ownership. Lastly, you will sign the purchase agreement and confirm that the payment has been sent. 

Receive a Free Business Valuation From an Experienced Business Broker

We help sell wine and beer taverns (and companies with a similar business model) sell for fair market value. You can get started with a free business valuation with a professional and experienced business broker here at Sigma Mergers and Acquisitions. It is our passion to help business owners execute their exit strategy, and we look forward to assisting you with your sale.

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Scot Cockroft Business Broker
Hi, I’m Scot Cockroft.

When I founded Sigma Mergers and Acquisitions back in 2003, I had sold my business the year prior.

Now, that can sound good, but let me tell you, back in 2003, it was not easy to sell a business. Not that I’m saying in modern day times it’s easy to sell a business, but back then I interviewed broker after broker after broker, and no one was interested in actually seeing the value that my business brought to the table.

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Sigma is a the leading business broker in with Corporate offices in Dallas/Fort Worth with roots from 1984. Over 600 businesses sold in Dallas, Fort Worth, Texas, Oklahoma and across the South. Sigma provides full business brokerage services with NO upfront fees. We provide Market approach business valuations for business sales. Sigma is passionate about helping business owners achieve their goal of financial security. Contact us today for a free no obligation business valuation. We are here to help you achieve your goals.

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