The restaurant industry has become increasingly competitive. Profit margins have been squeezed, while capital expenditures requirements have increased. The margin for error is tighter than ever. As a result, there is widespread interest in financial models that can improve investment decision making.
The restaurant unit is the basic building block of the restaurant industry. The financial performance of any restaurant business is a reflection of its unit economics. A well-calibrated franchise restaurant valuation model is a powerful tool that can be adapted to evaluate a wide range of investment alternatives; including the financial feasibility of new-unit development, acquisitions, franchise remodels and renewals — decisions that directly impact the profitability, and value, of restaurant businesses.
Valuation is the capstone measure of financial success. If you want to compete and win, you’ve got to know how to keep score.
The focus of my valuation resources initiative is the development of publications and practice aides that offer practical solutions to common franchise restaurant valuation challenges. At present I have two publications in process, if you’d like to be notified when they’re released please email email@example.com.
|Based on over 15 years of restaurant industry valuation experience, this text is a practical how-to guide — offering readers a rigorous framework for the development of credible financial appraisals of franchise restaurant units.|
|A significant challenge to the development of credible franchise restaurant valuations is that support for many essential inputs can be difficult to obtain. The Benchmark Survey responds to that challenge with a compilation of perspectives and insights from knowledgeable industry professionals. Topics to be covered will include; conventions for normalizing rents and corporate overhead, market multiples and the factors that drive them, and guidelines for franchisee capital structure and expected returns. Perspectives will also be offered on ongoing capital expenditure requirements. The Benchmark Survey is a resource that will serve to enhance the credibility of any franchise restaurant valuation.|