Listing ID: 76811
This iconic greater Santa Monica Area restaurant with 2-3 bars is literally a place of legend. The diversified venue has the unique ability to simultaneously operate as a bar and a restaurant, be both casual and formal and feel like a daytime venue while the sun is up and seamlessly transition to an evening dining venue and late-night scene as the night progresses. Due to the venue’s notoriety, the sale comes with built-in opportunity to expand to new locations and much more.
This storied venue has historically generated $3 ml – $5 ml in revenues with $500k – $1.0 ml in net income prior to COVID ‘s impact on 2020 and beyond. .
- Asking Price: $750,000
- Cash Flow: N/A
- Gross Revenue: $1,000,000
- EBITDA: N/A
- FF&E: N/A
- Inventory: $10,000
- Inventory Included: N/A
- Established: N/A
The facility will lease for $21k/month versus 6% of gross revenues on a new 10-year lease with 3% annual increases. All of the business’s furniture, fixtures, equipment, goodwill and Type 47 Liquor License will be included in the sale, with minor personal exclusions. An estimated $10k in inventory will be sold at cost at close.
Seller will train for 2 weeks at 20 hours per week or as negotiated
While competition exists, this is one of the most well-known and customer embraced dining, drinking and entertainment venues in the area. With their unique location, plentiful parking and unparalleled reputation, it is somewhat insulated from direct competition in the immediate vicinity. In addition to being a neighborhood favorite, they are perennially popular with tourists due to their location by a major tourist destination and from being featured in films, on television and in music videos.
New operators will likely embrace the concepts historic success, while using the well-established platform to maximize restaurant and bar profitability. They may also make these locations the basis for a new franchise chain or licensee operation.
The deal shall not include inventory valued at $10,000*, which ins't included in the listing price.
Why is the Current Owner Selling The Business?
There are all sorts of reasons why people choose to sell operating businesses. Nevertheless, the true factor vs the one they tell you might be 2 entirely different things. For instance, they may state "I have too many various commitments" or "I am retiring". For lots of sellers, these reasons are valid. But also, for some, these might simply be excuses to attempt to conceal the reality of changing demographics, increased competition, recent reduction in revenues, or an array of various other reasons. This is why it is extremely essential that you not count absolutely on a seller's word, yet rather, make use of the vendor's response combined with your overall due diligence. This will paint an extra practical picture of the business's present scenario.
Existing Debts and Future Obligations
If the current entity is in debt, which numerous businesses are, then you will have reason to consider this when valuating/preparing your offer. Numerous companies finance loans in order to cover points such as stock, payroll, accounts payable, so on and so forth. Bear in mind that in some cases this can indicate that earnings margins are too tight. Numerous companies fall under a revolving door of taking loans as a way to pay back various other loans. In addition to debts, there may also be future commitments to take into consideration. There might be an outstanding lease on tools or the building where the business resides. The business may have existing contracts with suppliers that should be fulfilled or may result in penalties if canceled early.
Understanding the Customer Base, Competition and Area Demographics
Exactly how do companies in the location draw in brand-new customers? Many times, operating businesses have repeat customers, which develop the core of their everyday profits. Specific factors such as brand-new competition growing up around the area, roadway building, and also staff turn over can influence repeat consumers and negatively impact future profits. One crucial thing to consider is the area of the business. Is it in an extremely trafficked shopping center, or is it hidden from the main road? Clearly, the more individuals that see the business regularly, the better the possibility to build a returning client base. A last thought is the basic area demographics. Is the business situated in a densely populated city, or is it located on the outside border of town? How might the neighborhood average house income influence future income prospects?