So, you’re ready to hang up your dancing shoes and make a successful exit from your nightclub venture. Before you announce “last drinks” though, here are seven helpful tips to ensure your club is sale ready!
Be market ready
Experienced buyers will want to dive deep and investigate your business thoroughly, so prepare a business offering package, complete with all pertinent information, to present to them. Provide detailed turnover and forecasting documents, and get your accounts up to date.
If you are selling stock, prepare a comprehensive stocktake, detailing any marketing deals negotiated with suppliers. Also, make sure your licences and permits are up to date, and retrieve all paperwork related to any lease agreements you may have.
Finally, wrap up any special arrangements you have (such as discounts or tabs) with customers, suppliers, and staff members.
You may also want to think about enlisting the help of a business broker to guide you through the exit process. Knowing you have someone on your side to make sure everything is handled with your best interest in mind will alleviate stress and give you peace of mind.
Be realistic about
Pricing your business correctly can be a tricky process. After all, you’ve put everything you have into it through the years and should expect a profitable return for all of your hard work.
However, you will also have to take an intentional look at what the current market value suggests, what you would like to walk away with, and what buyers are going to be willing to pay.
Take the time to seek out advice from your broker and look for comparable sales; then price your nightclub within that range. To get a better idea of the average list price of nightclubs currently on the market, visit here.
Spruce the place up
Look at your premises from a buyer’s point of view. Does the decor need updating? Do the bathrooms need refurbishment? When buyers see obvious things that need fixing, they often wonder about the condition of what they can’t see.
A fresh look needn’t break the bank, but it could help you achieve a higher selling price that more than offsets your outlay.
Have a purchase agreement ready
Prepare a purchase agreement form prior to finding a buyer. This will allow you to fill in the blanks when you have a buyer excited and ready to sign.
Often it can be a slower process waiting for attorneys to put agreements together, and the buyer’s enthusiasm may evaporate if the purchase is delayed. Having this taken care of from the beginning benefits both you and your buyer.
Look for a buyer in as broad an area as possible
Don’t depend solely on your local paper to produce all your leads. To get the optimal price for your business, you need to have as many qualified buyers as possible. Start by listing your nightclub on BusinessesForSale.com and increase your reach significantly!
Qualify the buyers right away
It’s important to qualify potential buyers and know their financial strength and business skills before you give them confidential information about your business or spend a lot of time with them. Agree on a sales price and terms prior to providing access to your financial records.
It is imperative that the buyer has ample opportunity to examine all aspects of your business and that you are transparent and make full disclosures. These are essential steps for protecting both parties and avoiding lawsuits.
What sets your nightclub apart from your competition? Here are a few examples of nightclub attractions to promote to potential buyers:
- Strong takings and/or profits
- High foot traffic or location in a busy business district or tourist hotspot
- Scope for additional seating
- Lack of local competition
- Plans for local residential/commercial development
- Emphasis on
potentialfor growth rather than present profits to downplay any unremarkable turnover
- Strong social media metrics and high ratings on TripAdvisor, Google, and similar platforms
- Recent refurbishments to reassure the buyer that additional capital for a refit won’t be needed
Finally, remember to be patient. Selling a business takes time. However, being prepared and organised for when the right buyer comes along will help ensure a smooth and successful nightclub exit. Ready to sell your business? Visit here to take the first step.