Tag Archives: restaurant industry

Restaurant Business Purchase Valuation Trends

Restaurant business purchase trends have improved, but you have to know wheree to look for buyers

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Independent Restaurants, 2011 Expected Developments

Independent Restaurants, 2011 Expected Developments

While the publicly traded and big chain restaurants get most of the trade press attention, the fact remains that a majority of restaurant businesses in the US remain  “independents.” Here are some notes and factors underway that will affect 2011: Slow growth, at best: a tide of returning to normal upper end business travel has […]

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Chain Restaurant Sales and Profitability Update , February 2011

A number of influnces and developments in the restaurant business sector are underway. The article hights fundamentals developments.

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Restaurant Sector: Survival and Potential Conflicts, Part 4

Restaurant Sector: Survival and Potential Conflicts, Part 4

Traditional Industry Conflicts Due to the fairly difficult nature of the business, some traditional lines of conflict between elements of business and society routinely emerge: Restaurant owners /operator vs. government and regulation: as noted earlier, restaurants are very highly regulated. One visit from the Board of Health can shut a restaurant and result in loss […]

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Restaurant Sector: Survival and Potential Conflicts, Part 5

Restaurant Sector: Survival and Potential Conflicts, Part 5

Restaurant owners/operator vs. lenders: lenders are somewhat suspicious of restaurants and the perceived high failure rate. While there are periods of easy money and credit, single unit operators at best have very constrained credit availability, and the big chains and successful large franchisees have it somewhat better. But even the large chains are not immune […]

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Restaurant Sector: Survival and Potential Conflicts, Part 3

Restaurant Sector: Survival and Potential Conflicts, Part 3

Most of the economic performance of any restaurant can be determined by the restaurant level economic drivers: amount of debt, interest rate, sales, cost of operations, and the cash flow (or outflow) that results from every restaurant. Once a restaurant operator reaches about 5 units or so, they will benefit and grow through economies of […]

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Restaurant Sector: Survival and Potential Conflicts, Part 2

Restaurant Sector: Survival and Potential Conflicts, Part 2

Despite the initial cost markup on food—restaurants have heavy fixed costs and really are truly busy with customers only a few hours a week. For example, the most profitable restaurants—McDonalds and Darden have reported total company profit margins only around 10%. For the independent operator, the economics is all about trying to pay their rent […]

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