Our Business Support and Advice can lead to helpful financial retirement planning and for one particularly happy client involved the successful solvent sale of a specialist tea rooms as part of a retirement plan.
We were introduced by the owners’ accountant to a husband and wife team who operated a very successful tea rooms in a picturesque Hampshire village. The business had traded for a number of years as a partnership and had produced strong financial results. The owners were now looking to enjoy their retirement.
With help from their accountants the couple had previously attempted to market the business. Unfortunately, despite finding an interested party, the sale fell through due to funding issues. Faced with no other interest the accountants then recommended that they approach Portland Business Support for advice.
The business traded from a small leasehold unit within a shopping mall. Despite being in close proximity to another popular tea room, it had its own regular customers and was benefiting from the recent rise in popularity of tea rooms, possibly influenced by ‘The Great British Bake Off’.
Unfortunately, when we were approached the lease only had four months remaining and the owners feared it was too short a timetable for a business sale. The landlord had expressed his desire to offer another lease to the couple, but they were keen to sell and sensibly did not want to tie themselves down to another 6 year term.
We were tasked with finding a purchaser and completing a sale within four months, with the couple keen to achieve a price around £80k. Not an easy proposition without a longer lease to assign and the cooperation of the landlord being key to the arrangement.
We began by producing the necessary sales material and marketing the business on the internet and to our database of contacts. The owners did not want the project to be public knowledge, for fear of unsettling the staff, and so we were restricted from using the name of the tea rooms or the precise location. This required some skilfully worded sales particulars.
Initial interest was encouraging with a number of parties asking for further information. With the benefit of confidentiality agreements in place, we were able to provide more detailed particulars. Within a month of being instructed, we had received strong expressions of interest from three parties with one party in particular showing a high level of desire to take over the business.
We secured proof of funding from the front runners, also a husband and wife team, and met with them to discuss their intentions. We explained our requirements for a quick process and introduced them to the landlord to discuss the new lease arrangements.
Our role within the next month comprised of assisting the purchasers with their due diligence process, overseeing the work of the solicitors involved in the sale and making sure that there were sufficient provisions for the handing over the business between the two parties, a necessity for the purchasers.
We were fortunate that the vendors of the business were knowledgeable and keen to assist where possible. The sale was completed in principle prior to the existing lease expiring which ensured there was a smooth transition between the two parties.
We were successfully able to negotiate a final sales price considerably in excess of expectations, which was a great result for the vendors. In addition to the very happy couple securing value from their investment, we have left a tea room under new revitalized supervision, a happy landlord with no break in occupation of his premises, and customers with their daily supply of pastries and tea without interruption – all in all a piece of cake….
Our success in the project was based on:
- An agreed and defined sales strategy
- Managing the expectations of all parties
- Ensuring good communication throughout
- Driving the process forward within a sensible timetable