Pizza Today - October 2016 - 47
developed business plan and financial
documents showing a track record of
success, including a current profitand-loss statement, tax records and
expenses ranging from food and
beverage costs to labor and overhead.
"Investors are going to want to look
over the details and these need to be
buttoned up," Guilfoyle says.
For the growth-minded concept, it
is also critical that ownership presents
a thoughtfully crafted development
strategy as well as the intact systems
that will allow both current and
potential restaurants to run effectively.
An operations manual with defined
guidelines around employee training,
food safety and marketing, for example,
serves as a blueprint for additional units.
"The concept needs to be something
executable and scalable," Bendas says. "If
it's too complicated, then it's tough to
And above all, ownership needs to
present a package that makes sense from
an ROI standpoint.
"Try to look at the investment
through the investor's eyes and see that
they're getting a suitable return on their
investment," Bendas says. n
Chicago-based writer DANIEL P. SMITH has
covered business issues and best practices for
a variety of trade publications, newspapers,
Four Common Equity
The restaurant world is littered with
equity investment deals gone bad. To land
and maintain a healthy relationship with
investors, avoid these common pitfalls:
Rejecting professional guidance.
Restaurant consultant Danny Bendas
suggests investment-seeking owners
work with a seasoned financial
professional like an accountant to
determine the value of shares and deal
parameters such as payback time and exit
Making no personal financial
commitment. Investors want to see
ownership have skin in the game. Risk is
best when shared, not one-sided, Bendas
Thinking investors can wait.
Culinary Institute of America associate
professor Bill Guilfoyle suggests investors
get paid first. "This is something investors
will find reassuring and important to
building trust," he says.
Allowing investors to have an
operational voice. The shareholder
agreement should clearly state that
restaurant ownership maintains full say in
business operations. "You don't want to
have to rule by committee," Bendas says.
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