Fond de commerce

[barrel]

Can anyone tell me how I can get a valuation on the fond de commerce of a restaurant

Thanks

[Pickles]

[quote user="barrel"]Can anyone tell me how I can get a valuation on the fond de commerce of a restaurant[/quote]

I presume that you are either buying or selling. Essentially, what you are doing is trying to put a value on a business which will comprise:

An income stream from customers buying meals/drinks (and the assumption is that this would continue at that level)

The right to occupy the premises (which of itself may have some value if it is in a good spot) against rental payments

Bits and pieces of equipment (although some of that may be rented)

In practice, it tends to come down (even more so than in other circumstances) to the value that a buyer and a seller are prepared to compromise on.

From what (little) I have seen from the sidelines, the price asked initially is always overly optimistic (unless it is in effect a distress sale), as are the books presented as proof of the income, and the actual income after the change in management is always significantly lower than one might expect, whilst costs are higher.

Regards

Pickles

[Pickles]

I've sent you a pm.

Regards

Pickles