Choose your Agent wisely
Check on their experience in your sector. Ask about what they have sold in the area / of a similar type; understand exactly who will be dealing with your sale and what they will be doing to market your property. Ensure that they can explain, and justify, their sales advice. Don't be misled by unrealistic sales advice that seems too good to be true, because almost certainly it will be. You don't want to be stuck in a long contract at an unrealistic guide price with the agent doing nothing for you, and just a call centre to discuss activity with. It is credible, supported advice and proven selling tools that will provide a high quality sales service and true added value. For more information about choosing an agent visit this link.
First impressions are vital. As the plethora of make over programmes on television demonstrates, even minor cosmetic issues can negatively impact on the desirability of your premises to prospective purchasers. We don't expect you to be baking your own bread, but it is important that you make sure your property is looking its best when it comes to sell. Set time and resources aside to finish off all those little jobs that may put off potential buyers. We would suggest that you go outside and have a look at the property to ensure that the signage is up to date, the flower baskets are stocked and the cigarette butts are removed from the smoking shelter. Then have a look around the property on the basis that you are "the buyer" and be honest with yourself. Better still, ask a friend to do it and act on the issues raised.
Although potential purchasers will initially be drawn to your property by a number of differing factors, the most important consideration when it comes to price is often the current trading position. You should ideally provide the last three years audited accounts together with the last four VAT returns. If the accounts do not split the turnover then it would be beneficial to get the split between wet sales, food sales, machine income, accommodation etc. Make contact with your accountant to ensure that the accounts are brought up to date. The lack of documented trading information may have a serious impact on your sale.
Any items of disrepair need to be addressed at the outset, as they could become an issue at a later stage if they are not dealt with. The later you leave it the bigger the problem will be.
Wages will be one of the highest overheads for your business, possibly your biggest asset and sometimes your biggest liability. Please remember that employees are protected by the transfer of undertakings regulations (TUPE). You will need to provide details of all employees working in the business, their names, hours of work, rates of pay, length of service, job description, dates of birth and any other material terms of employment. You should ensure you have this available for when you need it. If at all possible, don't leave your staff in the dark once you have decided to sell. Keep them informed, reassure them about their futures and above all, be honest with them. It is better to hear the truth from you rather than rumour from somebody else.
It would be useful if a copy of the land registry plan could be provided on inspection so your agent can then check this to define boundaries and to discuss with you any possible disputes that may arise later down the road. Currently we are selling a number of properties for alternative use and in these cases, it is key that the site plan is available. It would also be useful to have licensing floor plans and details of any planning permissions that have been granted.
We will need to respond to a raft of enquiries from the prospective purchasers, which will include a request for many documents/ certificates. The key ones which would be well worth obtaining at the outset are as follows:
- Corgi gas safety annual inspection record.
- Electrical periodic safety inspection record (usually every 3-5 years).
- Fire risk assessment.
- Portable electrical appliances test (PAT) certificate.
- Asbestos report/audit.
- Health and safety records.
All Fleurets offices have a panel of solicitors that are experienced in dealing with licensed/leisure properties. It is important that you instruct a solicitor who is experienced in dealing with licensed property as it does involve specific aspects that will require legal consideration/ action.
The above will apply to all properties but the following will only apply on leasehold sales:
Potential purchasers and their legal advisors/valuers will want to review the details of the current lease together with licences for alterations or assignment if applicable. If you have an outstanding or imminent rent review, then it might be best to deal with it in advance. A good agent can advise you on this. You are not required to at this stage but it can often help to make contact with your landlord or Area Manager to notify them of your proposed sale. You will need to provide details of any tie arrangements and discount terms which can vary considerably from one agreement to the next.
When it comes to the assignment of your lease, you will need the co-operation of your landlord or managing agents. As and when terms are agreed, we will need to provide details of the purchaser, bank and character references, business plan and accounts, notifying them of your wish to assign and requesting their consent. Doing this in a detailed way at an early stage will ease this process.