How to buy a fish and chips shop?
Click here to download a business sale agreement to buy a fish and chips shop.
Fish and chips is a British staple with than 10,000 shops selling fish and chips across the country, which is far more than McDonalds and KFC. However, when it comes to buying an existing fish and chips shop, you need to choose carefully to ensure your business is successful.
Despite the popularity the dish has gained, it is a very competitive market and it can get difficult to make a profit due to high costing ingredients which go into this dish.
This article will equip you with the information you need to buy a fish and chips shop and ensure its success.
- Experience in fast food and hospitality will be hugely beneficial.
- You will have to be adaptable to the new trends. For instance, many people now adopt for gluten free fish and chips.
- You will have a team of employees working for you. You should have management skills and know how to keep your employees motivated.
- Capability to maintain high standard of hygiene and cleanliness.
Location of the shop
The first and most vital step before you buy a fish and chips shop is finding the right location. It will make a huge difference in your business’s success and profitability. To get you started consider the following:
- Low income area – most fish and chips shop attained success because they cater to people in the low income areas. It is supposed to be an affordable but delicious meal.
- High income area – people who have more money to spend are more likely to cook at home or go to restaurants. With that being said, it is still very likely that a fish and chips shop in a high income area will succeed due to the dish’s popularity.
- Mixed income – while town centres or busy high streets will give the most footfall, it will mean higher rents and rates.
You also need to think about the proximity to your competitors. Competition does not necessarily mean bad news. Many people want option and if yours is most value for money it could attract your competitor’s customers.
What will be your business model?
You need to think about whether you want to buy a business which comes with a freehold or leasehold.
A freehold property will mean higher initial cost but you will not have to continuously pay rent. On the other hand, with a leasehold property you will have to assess the term of the lease and the business turn over to determine the profitability of the business.
Conversely, you also franchise. There are numerous opportunities, however, vast majority are independently owned.
Financing to buy your fish and chips shop
To buy a fish and chips shop, you will need a significant amount of capital. You might qualify for a government backed Start Up Loan which comes with a years’ free mentoring.
The process of due diligence is one that provides a thorough investigation into a proposed investment transaction. It means you check the investment worthiness, and assess the full claims made by the owner. This check is usually performed by a solicitor and accountant who act on behalf of the buyer. A large portion of due diligence will involve checking financial statements and accounts.
Click here to find more about due diligence.
If you buy wisely and do thorough research of the background and potential of the business which attracts your interest, you will get immediate access to the existing base of customers and suppliers. This make ensure that you know what you are getting into.
You need a solid contract
You, as the buyer, will have to produce the sale document. This agreement will have to cover the mechanics of the deal – what is being sold, where it is, how it is to be transferred, and so on. This is where warranties come in. Click here to download a business sale agreement if you are purchasing a fish and chips shop.
Warranties which are legally binding promise as facts about the business, which provide information relating to the business. Click here to know about how warranties work and why they are important.
Other documents you need
Additionally, you may need assignment and novation agreements to transfer contracts the seller is a party to.
If company shares are being sold, then you will need directors service agreements, board minutes to document approvals to changes, and possibly, a new shareholders agreement and new articles of association.
We can help you find exactly what you need for your circumstances if you contact us and ask.
Please note that the information provided on this page:
- Does not provide a complete or authoritative statement of the law;
- Does not constitute legal advice by Net Lawman;
- Does not create a contractual relationship;
- Does not form part of any other advice, whether paid or free.
We would love to hear what you think about this article and how we could improve it. Please do let us know. However, we shan't be able to reply to your specific questions. If you have a question about a document, please contact us.
If you have noticed a bug or a mistake on this page, or just want to give us feedback, we'd love to know. Nothing is too small or too big. Send your message on this feedback page.