Licenses, documents and fixes buyers look for when you sell a restaurant
| Done | Issue | What to know |
|---|---|---|
| [ ] | Liquor license transfer (California example) | California requires an escrow with a neutral holder before filing a liquor license transfer application where there is a purchase price; the buyer deposits the full price, and the escrow pays the seller's bona fide creditors who file claims before ABC approves the transfer (B&P Code 24074). |
| [ ] | Lease assignment | Most restaurant leases require landlord consent to assign, and landlords often ask for the buyer's financials and a personal guarantee. Start this early; it is the most common deal-killer. |
| [ ] | Health permit and inspections | Food service permits are generally issued to an operator, so the buyer typically applies for its own permit and may face a pre-opening inspection. Check your county health department's change-of-ownership rules. |
| [ ] | Franchise units | A franchised restaurant cannot be sold without the franchisor's approval of the buyer under the franchise agreement; expect a transfer fee, training requirements and possibly a remodel. |
Most restaurant sales are asset sales paid mostly in cash at close from an SBA loan plus buyer equity, sometimes with a seller note; inventory is added at closing at cost.
Plan for 6-10 months from preparation to close; the lease assignment and any liquor license transfer usually set the closing date.
Rules vary by state; confirm licensing and transfer requirements with counsel. General information, not legal or tax advice.
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