Melbourne’s café scene is world renowned and there are plenty of opportunities for savvy buyers. With the city coming out of the Covid19 pandemic, cafes and restaurants are buzzing as locals and visitors flock to enjoy Melbourne’s dynamic dining scene.
Suburban areas are also taking off as more people work regularly from home post-pandemic, providing opportunities in areas which may have previously had lower traffic, so consider a range of areas in your search for the right café business. The city’s most celebrated cafes combine excellent coffee with great food and insta-worthy décor. Famed for having some of the best coffee on earth, Melbourne’s roasters and baristas are some of the most accomplished and innovative in the world. Expectations are high among customers who have plenty of options in both suburban and CBD locations, so buyers need to do their homework.
Here are some top tips for potential buyers.
Do your research:
Know what you are getting, spend some time in the places you are assessing. Do this on a number of different occasions so you have a really strong sense of what a place is like at different times of the week and day. Some buyers may even offer to work a couple of shifts to see how the place runs.
Know the area:
Make sure you understand the broader environment surrounding your proposed purchase – what future developments are planned for the area? Is there a fast food restaurant slated to open or another new café? These are key considerations when buying.
The money stuff:
Know the profit margins – is the place turning a healthy profit, or just covering expenses? Establish how much work will be required of you to earn a wage – are you looking at 40+ hours a week just to survive, of or is there some wiggle room? It also pays to check out the lease agreement – is there a good long-term lease in place, or will you soon need to negotiate a new one? Equipment si another area where buyers can be caught out. Don’t forget to check whether the equipment is owned outright, under lease or being paid off. This can greatly affect the value of a business and the price you should pay.
The people stuff:
Check into the relationships with staff and suppliers. Will staff be willing to stay on under new management? Are relationships with suppliers solid with accounts paid on time? Will they be happy to deal with you once you take over? Great coffee is often a key to success in Melbourne, so be sure you have the right staff to meet the high expectations of melburnians when it comes to their coffee.
Get another opinion:
Even if you’re an experienced business owner, make sure you get professional assistance by having your accountant and solicitor look over the figures and contract. Buying a business is a major investment and you want to be 100% sure you are making the right decision.