You want to sell your bakery? Then it's good to know what the takeover market in the field of bakeries looks like. The bakery business covers several sectors, as it depends on the way of delivery and production. There is a piece of industry involved, as raw materials are processed into a finished product.
This end product belongs to the food sector, but the bread is sold in a bakery store. The number of artisan bakeries is steadily declining, despite recruitment campaigns, while opportunities for so-called convenience foods are up for grabs.
The bakery business has been in crisis for years. Many artisan bakers are retiring now or soon, while there is a scarcity among the number of bakery apprentices. Succession from the family line is less common, leading to more mergers and acquisitions. The campaign launched in 2014 to find successors failed big time.
Meanwhile, for a scant three years, the campaign to call on passionate food entrepreneurs to specialize in the baking profession has been underway. And with success, the popularity for the baking profession is increasing. The demand for craft rather than thirteen-in-a-dozen products is also growing the merger and acquisition market.
There are many ways to value a business. A common method of expressing the value of a business is "a factor x gross annual profit." This factor is also called multiple and another designation for gross annual profit is EBITDA (Earnings Before Interest Taxes Depreciation and Amortization).
In the retail sector - to which a bakery belongs - an indicative range of EBITDA multiple of 1.9 to 3.0 is currently used, according to the Brookz Takeover Barometer. The average EBITDA multiple across all SME sectors is 4.90.
The valuation of a business is often the starting point for negotiations between buyer and seller. The outcome of these negotiations is the final sales price. So valuation and price are two different quantities. Besides valuation, the price is also determined by possible scarcity in the market, bargaining power of the parties, the strategic value of the business for the buyer and possible synergy effects for the buyer (cost savings, purchasing advantages).
Do the calculation
Want to buy a business or sell a business in the retail sector? With this Brookz Sector Monitor we want to present buyers and sellers with facts, figures and an outlook that provide insight into the number of transactions, the value development of businesses and the latest trends and developments in the retail sector. Because in any buying or selling process, thorough preparation provides peace of mind, overview and structure.
Download report
CBS has calculated a separate industry for this purpose, namely bread and pastry bakeries. The industry looks like the following in 2024:
With this online training from Brookz you are optimally prepared to largely sell your business yourself: 25 Powerpoint videos, a comprehensive valuation report, legal model contracts, handy templates, checklists and expert support. Plus 50% discount on listing your business on Brookz!
To Brookz Academy
A number of trends and developments will inevitably cause changes over the next few years, but also offer bakeries many growth and acquisition opportunities:
Consumers are increasingly aware of the impact of food on health and the environment. Choosing locally and consciously fits completely within the trend of sustainable and healthier choices. We are all looking more often for fresh, local and artisanally prepared products. And the "support you locals" trend during the corona pandemic certainly contributed to this impulse.
Somewhat due to the corona crisis, bakeries' online offerings have improved. Bakeries are improving their online marketing and also offering fresh products online. Sometimes in-house, but also increasingly by partnering with other distributors. Consider the successful online supermarket Crisp, which sells bakeries' products.
Finally, the time-honored trend of "convenience serves man! We all want to live healthier lives and consume food consciously, but a greasy croissant from the Jumbo oven is still a hit. Schoolchildren in particular know how to find their way to the supermarket during their lunch break, but according to the FSIN, consumers are eagerly looking for healthy, easy meals that can be consumed immediately.
