You want to sell your café? Then it's good to know what the takeover market in the field of pubs looks like. Due to corona measures, pubs were having a particularly tough time. As a result, the number of (forced) business acquisitions might increase, as scale plays an important role in the industry.
Scale is very important for pubs, as evidenced by the number of acquisitions. Through scale, advantages are gained, such as better prices from suppliers. These are essential to achieving better profitability.
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 hospitality, tourism and recreation, the sector to which pubs belong, an indicative range of EBITDA multiple of 2.9 to 4.0 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).
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Do you want to buy a business or sell a business in the Hospitality, Tourism & Recreation 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 Hospitality, Tourism & Recreation sector. Because in any buying or selling process, thorough preparation provides peace of mind, overview and structure.
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The growth in consumer spending is having a positive effect on pubs. However, the situation remains challenging, with the business model for a traditional café remaining under pressure. For the longer term, Rabobank market researchers expect competition to increase further. As a result, it will remain a fighting market, where distinctiveness is crucial.
In figures, the number of pubs looked as follows in 2024(CBS):
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A number of trends and developments will inevitably cause changes over the next few years, but also offer cafes many growth and acquisition opportunities:
The traditional café is having an increasingly difficult time. Both cafes and coffee bars are increasingly adding an eating aspect to their product range. As a result, cafes are shifting more toward eateries and coffee bars are shifting more toward lunchrooms. As a result, there is far-reaching branch blurring.
Pubs are increasingly facing competition from festivals and food concepts, according to Rabobank. To remain relevant, they will have to add more and more experience to their concept. This requires higher investments and creative management. Organizing events is a good way to attract more audience during the quiet off-peak hours.
During the corona crisis, the roles were reversed for a while, but staff shortages are now back on the scene. Just when the market has the opportunity to recover, the shortage of skilled personnel is hampering reconstruction, according to UWV.
