Preparing to sell your business

At Sidney Phillips, we pride ourselves on our honest and professional approach to selling your licensed business and property.

The decision to market your business for sale can be a tough one, whereby naturally you will want to get the best possible price. Sidney Phillips always aims to achieve the best possible price for you in what is still considered to be a challenging market, and below is a brief guide to some steps which you as an owner can take to help achieve this before your pub, restaurant, hotel or other licensed business is marketed for sale.

Preparation is key…

A major factor in generating interest in your property or business for sale is to ensure that it is priced correctly. The value of licensed properties and businesses is closely related to trading results and potential and in order to provide you with an accurate Asking Price, it is best to provide your Valuer with full disclosure on all matters of your business.

Accounts

Having up to date Profit & Loss trade accounts for your business will help the Valuer provide you with an informed and accurate conclusion as to the likely value and saleability of your property and business. The ability to demonstrate turnover figures, profit margins and occupancy levels will increase the likelihood of a potential purchaser making an offer. The stronger your accounts look, the more likely you are to maximise business's value.

Ultimately the more that is put through the books, the better!

Lease information

If your business is owned on a Leasehold basis, a potential purchaser will be insistent on knowing the full lease terms. In order to do this, it is best to provide your Valuer with a full copy of your Lease and have to hand key terms such as the length of lease, annual rent, repair liability, deposits held and whether it is tied, partially tied or free-of-tie. Having a rental invoice to hand is also helpful.

Little touches make a big difference

Small things can add to the presentation and saleability of your pub, restaurant, hotel or coffee shop business. Consider making low-cost additions or repairs that may give the premises a bit of an uplift, such as hanging baskets and flowers. In addition, touch up painting, clean carpets and tend to the garden. You will be surprised how much a purchaser will spot when undertaking a viewing!

Similarly, if you are a Leaseholder, start discussing your repair liability with your Landlord. They will provide you with a Schedule of Dilapidations - repair works and statutory certifications that are required to be done, prior to you leaving the property. Making an early start on this work will not only spread the costs and make the property look good for viewings, it will reduce the risk of a purchaser trying to renegotiate the price later down the line if the works are outstanding.

Energy Performance Certificates and Minimum Energy Efficiency Standards

By law, all sellers and agents listing a businesses or properties for sale must provide a valid Energy Performance Certificate (EPC) from the point that marketing commences. Failure to do so can result in fines of up to £5,000 for each party. Given that a Non-Domestic EPC will likely cost £250-£400 (depending on the size of your property) and is valid for 10 years, it is a worthwhile investment. There are exceptions to this however, as some Listed properties in the UK do not require an EPC to be in place.

The Minimum Energy Efficiency Standards (MEES) Regulations make it unlawful from 1st April 2018 for Landlords to let buildings (both commercial and domestic) in England and Wales which do not achieve a minimum EPC rating of E. Therefore any Landlord owning a property rating F or G must not renew existing leases or grant new leases (this includes tenancies) if the standards are not met. At present, this does not affect the sale of existing leases. After 1 April 2023, Landlords must not continue to let any building which does not meet the standards. There are exemptions to these rules, of which more information can be obtained via the following link: Click here for more detail.

Pick the right agent

Picking the right agent is the most important factor in not only finding a buyer, but also maximising the achievable value of your property. Your agent should, and Sidney Phillips do:

- Have local and regional market knowledge (whether that be the market for Pubs for sale, Restaurants for sale, Hotels for sale, Coffee Shops for sale, Development Sites for sale or Investments for sale;

- Have national coverage, with a strong online presence including Morning Advertiser, Daltons, RightBiz, Landsite and Zoopla;

- Advertise in the relevant trade press, such as the Morning Advertiser

- Not charge “up-front marketing” or “commitment” fees;

- Work on a No Sale No Fee Basis;

- Have a proven track record in successfully selling businesses for sale, and can demonstrate what they have recently sold.

Remember...

Beware of rogue agents who promise you the world for minimal fees – you get what you pay for. Sidney Phillips offers some of the industry’s most competitive fees on a No Sale No Fee basis, and pride ourselves on our approach to selling your business and commercial property.

To view our properties for sale click here.