The food industry is exciting, romantic and an industry that many business owners and entrepreneurs want to get involved in. This is totally understandable – who can resist all that deliciousness?
Before taking the leap and buying a food-based business there are 5 things you should consider:
Revenue. What is the current revenue and the revenue potential? Knowing if the particular type of food business you are buying into is popular to the masses, or popular with a smaller target market, is knowledge that will help you to understand the revenue potential for years to come. Before buying the business do the math to understand if you have a stable business offering.
Why is this particular business for sale? There are a myriad of reasons why business owners put their businesses up for sale. Do some digging to make sure the reasons are not connected to a health violation or a change of heart in the community towards the type of dining option being offered. Knowing as much of the history of the business as possible will enable you to make smart decisions.
Location. We always hear in real estate that location is everything – and it is. Location is so important to the success of any business, especially one that requires customers to come to their location to dine. You want to define your target market as precisely as you possibly can and then make sure they have easy access to your products.
The food business is highly competitive. There are very well know players in the game already so you want to make sure you can compete amongst the giants in the industry. Understand where your competitors are positioned, and as much about their marketing strategy as possible to be in the best possible position to stay competitive. The food industry has alternative options virtually every ten feet so you need to know and understand your competitors very well in order to thrive in your business.
Consider how the current owner runs the business and if there are any changes you can make to improve the bottom line. Are there changes to the menu or offerings you can make to be more cost-efficient. We will help to break down the operating costs and review if there are more efficient ways to operate without compromising the products. It is a delicate balance to keep your product offering interesting and new and also stay within, or below, your operating budget. The more you understand this aspect of the business, the better off you will be.
If you are interested in buying a food-based business the team will be happy to review these 5 steps in more detail. Contact us today or visit our website for more information www.rine.ca