Restaurant and Catering Facility
Business Performance Optimized
"Fortis provided me with an accurate valuation that saved me from making a $450,000 mistake."
- the prospective buyer
Seated in Charlotte, NC is a full-service Italian restaurant serving the Ballantyne community in a casual dining atmosphere with private dining rooms and catering facilities. Chef-owned for less than 6 months, when financial challenges took hold the restaurant was surrendered to the construction firm that was owed the largest payable. The firm was not interested in the restaurant business, but the payable due was significant enough that they decided to operate the restaurant, expand the service offerings, aggressively address profitability challenges to minimize additional capital investment and seek out a new buyer to recover the balance of the debt. Due to negative profitability trends, ownership had been poorly advised to sell the business at a premium price that included construction costs.
Fortis Business Advisors was engaged by a potential buyer to support due diligence in evaluating feasible profitability, cost-cutting measures and the efficacy of ownership's arrival at its selling price. During the engagement, Fortis was asked to review floor plan layout, menu planning, food and beverage costing, back-of-house vs. front-of-house communication and culture, staffing efficiency and pay structure, and the effectiveness of the marketing and social media thrusts. Utilizing Fortis Foresight™, the financial and operational analysis included comparative quarterly income statement trends partitioned into different revenue drivers, ratio health, uncontrolled cost distribution, break-even efficiency, labor costs and pay structure reflective of a restaurant business. The analysis also included table turnover efficiency, number of tables per server, kitchen, and food production line timing and efficiency.