blonde poker forum

I'm currently negotiating to buy a bar but before going through with everything need to see all the numbers in detail.

The owner of The bar is asking for a 15% refundable deposit before he discloses information/goes through all the questions etc. he wants to see if in actually serious or something.

Is this normal? I imagined he would just tell me all the things as I've obviously signalled a lot of interest.

Should I be concerned?

He wants 15% non-refundable before he lets you look at the financials?

I'd politely decline.

Says refundable.

No way, if he's keen to sell and it's a good business he should be showing you without any of that nonsense.

I've not come across it before.
Are you going through an agent? They should hold the refundable deposit.
If not, I would be careful.

In the time he is not allowed to sell it to anybody else.

Hope you know what you are doing by the way, it's a tough game, my family own a few places. Hard to make money selling booze unless you are a busy town centre place, it tends to be the ones struggling that are up for sale. Food is the best area to make money to be honest.

Give me 15% deposit, I'll refund it if you don't buy, and I won't sell to anybody else...

Is it this guy?

(https://sp.yimg.com/ib/th?id=HN.608045680076391560&pid=15.1&P=0)

There's a reason why rich people buy bars... They have their money and choose to spend it as they wish! Rather then making their money through the bar!

Money/profit is made from the food element and not really the bar.

You need to have due diligance in the books, which shouldnt come with any financial remit. You both should have a Non disclosure document maybe, but no more than that i'd have thought.

How can someone not make money from selling drink at £4 a pint?

pads gimme 55% deposit and i'll answer this question....

That's me reading on my phone, apologies. I'd still decline though

tax

Overheads. You might do ok at the weekends, but think of the week nights where you might only sell 30-50 pints. The profits is small beans compared to food.

Most of it goes to the government.

Pads, I have never heard of the deposit thing. Perhaps he just wants to make sure you are serious?
I run a (successful)pub at the moment , feel free to shout if you want any advice.

Jez

I would not give any deposit but maybe offer to sign a non-disclosure document for confidentiality.

If the seller wants a deposit it maybe to ensure you have the finance to go ahead and not a time waster.

Most sellers would be happy if they could get confirmation from your bank or solicitor to show you are genuine and have the finance available to go ahead after due diligence checks.

Good luck.

Absolutely no reason to be paying any sort of deposit.

He is entitled to ask for 'proof of funds' to get some confidence that you are genuine, but if he is actively looking to sell, then he should have accounts on hand to help justify the price he is looking for.

It's still very much a buyers market when it comes to the bar/restaurant trade.  Although owners will claim that revenues are on the up, they are still way off the levels of 4-5 years ago.


I've been working with a client for a number of months now on a small restaurant purchase.  It still always amazes me the valuations that some owners put on their businesses.


Good luck with the transaction.  Just make sure you've done your own homework and don't rely on the numbers the owner will provide to make any decisions.

I've been under the impression that the restaurant trade did well during the last 5 years but has started to struggle now as the economy has started to pick up.

Small beans are food.

What logic is there behind this statement?  Seems totally the reverse of what should happen.  Eating out is an unnecessary luxury to the masses and is cut to a minimum when times are hard and demand for it increases as the economy booms.

This is what I thought, then looked into about 10 restaurants in my local area and they seem to have had the exact opposite effect, I'm trying to sell two restaurants at the minute and all are wanting to pay massively under the odds even though the rest of the market is seeing a bit of a resurgence. We are seeing properties going for on asking price or over for the first time in 4 years yet not for restaurants!

Absolutely not mate, been a big down turn and many of the lesser places just haven't survived, it's slowly picking up though now but still a mile away from where it was pre bank crisis. One of my bros was telling me about it only the other week, they saw no difference for a good 18 months after the crash and then it was like someone just pulled a rug out from under them with no warning. They had to cut back a fair bit themselves as they had a very good life on the back of what that particular place was making before it went tits up. Fortunately they are good enough to still be making an ok living and are on their way up again.

All of this is true plus interest rates will never get lower so as they rise the disposable income floating around in middle england will be reduced again and eating out is one of the first things to go/get cut back by the masses

this is in budapest, huge student scene/tourist scene and bar is next door to the biggest club here.

Sure.  I gather most of the stuff we are talking about probably isn't relevant to your project as we have gone off track somewhat.

Why is the guy so keen to sell this goldmine in the perfect location?

This is what I would want to know....

Why is he closing/selling? Think this is key also!