Business Transfer expert Beverly Northey looks at why now is a good time to both buy and sell catering businesses.
Cornwall has had a very busy 2017 with visitors pouring in from overseas as well as from across the UK.
This has been all good news for those in the catering trade with cafes, restaurants and hot food and drink outlets, such as pasty and coffee shops, all in demand.
A recent TV programme suggested that in the UK we eat out in some form 3 times a week. Seems like the packed lunch is on the wane!
Which means nothing but good news for those running and owning catering businesses, particularly in places like Cornwall where the local market is supplemented significantly by tourism.
Why buy a catering business?
At Miller Commercial, the catering sector is consistently the most active/popular, accounting for 40% of all our business sales.
Encompassing everything from an ice cream hut on the beach to an a la carte restaurant in the city, the diversity is immense.
And it is a relatively easy market to enter with many operations, such as tea rooms, cafes, sandwich bars and seasonal outlets not necessarily requiring award winning chef skills in order to be successful. The key to success seems to be good value food combined with really good customer service.
The catering sector is very flexible so you can tailor your business to suit your lifestyle, skills and ambitions: from seasonal to all year round, basic fayre to fine dining, daytime only opening, etc.
Buy a catering business in Cornwall and you have a huge choice of locations: City centre, coastal town, Cornish village or on the beach.
Catering business can also be easily personalised, offering you the chance to ‘standout’ via décor, quirky seating, trading hours, unusual specials, an attention grabbing business name, etc.
Financially, it can be very profitable as often smaller operations can be operated by a husband and wife team with a minimal staffing requirement.
What do you need to consider before you buy?
The key question is always : who will your customers be? - will you focus on the local community or rely on the holiday trade or try to hit both markets?
Location is an important consideration; you need to think about where your customers will come from. Ideally, you need a location that has the potential for lots of regular business as well as passing trade.
Think also about whether you want a business that trades all year round, or would you prefer something seasonal? Bear in mind that the tourist season continues to expand.
Don’t forget to consider how many hours you want to work. It’s not just the ‘opening hours’ - bear in mind what needs to be done when the business is closed as well - food preparation, ordering, cleaning, staff rotas, bookkeeping, promoting the business etc…You might be surprised how many ‘extra’ hours that can involve.
And finally, do you want to employ staff? Not everyone does preferring, often as a family, to run and staff the business themselves. Be mindful though that at really busy periods you need to ensure your customers demands are met, so having extra staff at peak times is something that might be a necessity. If your skills are ‘front of house’ then it may be more efficient, and ultimately more profitable, to hire in ‘back of house’ help such as a bookkeeper or accountant, cleaners, chefs, etc.
When’s the best time to buy a catering business?
Most catering businesses in Cornwall will see some degree of uplift during the key tourism periods – typically from Easter through to autumn half term.
So, as we have just passed autumn half term now is the time to buy!
Buying now gives you plenty of time to complete your purchase and plan for your success in 2018.
If you can be up and running by the beginning of March, you will have the benefit of a few weeks ‘to find your feet’ ahead of the tourism season.
What’s currently available?
Right now we have some great catering businesses available. Here are just a few for you to choose from:
On Shore in St Ives – Located on the wharf with spectacular views of the harbour, this 45 cover licensed café boasts both impressive profits and a stunning location. Superbly presented throughout, the business achieved sales in excess of £530k in 2016 and is offered for sale by way of the assignment of the existing lease.
Hells Mouth Café near Gwithian
Located on the North Coast Road between Portreath and Gwithian, Hells Mouth Café is operated on a seasonal basis and enjoys excellent levels of profitability. Ideally suited to a ‘husband and wife team’, the café currently focuses on daytime trade only with sales in the most recent year in excess of £195,000. Click here for full details.
The Comfort Food Café
A licensed daytime café in the heart of the Cathedral City of Truro with 50 covers and good levels of passing trade. Click here for full details.
Gravy Boesti in Truro
A beautifully refurbished and well equipped licensed restaurant adjacent to the law courts in the city of Truro. Offering a fine dining experience, with 28 -32 covers in the main restaurant with a further 16 in the pretty rear courtyard, the restaurant boasts a theatre style kitchen and extensive service areas to the first floor. Click here for details.
Please contact Bev for any advice or just for an informal chat on 01872 247031 / [email protected]