The restaurant sector continues its post-pandemic recovery, as transaction volume remains steady year-over-year, yet 8% lighter than the previous quarter. Buyers focused on higher-priced restaurants, with the median sale price up 9% since last year and 13% since last quarter.
Robin Gagnon, co-founder of We Sell Restaurants, comments, “We are seeing deal sizes much higher than last year and more cash buyers which supports that some buyers have simply been holding onto cash and sitting on the sidelines but have now jumped in. We are also seeing existing owners of franchise units much more willing to look at resales versus building from the ground up.”
Restaurants that sold in Q1 also show healthy financials as more customers opt to dine out, with median revenue up 11% over the previous quarter and 9% over the previous year. Median cash flow was up 14% over the previous quarter and 4% over the previous year.
As Q1 sale prices indicated, buyers are willing to pay more for restaurants with strong financials – those winning some of the toughest challenges around wage hikes and higher food prices. Whether it’s high-volume popular mainstays or high-tech convenience, many restaurants are on the upswing.
Article courtesy of BizBuySell.com, 1st Quarter 2024 Insight Report
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