Cafés, takeaways, and specialty food retail trade on thin margins and location quality. This guide covers the benchmarks buyers use and the red flags to check before making an offer.
Typical retail food and beverage valuations run 1.5x to 2.5x SDE; strong recurring catering or wholesale accounts push toward the high end, pure walk-in retail pulls it down. Key factors: lease length, rent-to-revenue ratio, and assignment terms; equipment age and health-code inspection history; labor dependency and kitchen staff retention; supplier pricing and food-cost percentage; and foot-traffic patterns. Before trusting the broker's numbers, verify POS reports against declared revenue, check whether sales survive the owner's departure, and confirm the lease survives the sale — a great location with two years left on the lease is a short-term investment.