How do I tell if a café relies on the owner’s own hours?
Ask who opens, closes, bakes, orders and covers shifts, and compare it with the payroll. If the owner or family works long hours without a wage on the books, the café depends on that labour, and you will need to fill those hours yourself or pay someone to.
Many cafés run because the owner is always there. That is not a flaw, but a buyer should know it before closing. If the owner’s hours are quietly holding the café together, the business you buy is one that needs a person doing that work, and the books may not show what it costs to replace them.
Watch a few ordinary weeks
Visit at different times: the early rush, mid-afternoon, a closing shift and a weekend. Notice who is behind the counter, who handles problems and who the regulars ask for. Ask the seller to walk you through a typical week by the hour. A schedule that only works because the owner covers the gaps is the clearest sign.
Compare the schedule with the payroll
List every task: opening, baking, ordering, banking, scheduling, cleaning. Then check who does each and whether that person appears on payroll. Family members who help without a wage, or an owner who takes no salary, mean labour that someone will have to perform or be paid for, which your accountant can help you work through. Your accountant can help you read the financial statements with that in mind.
Decide what your own role will be
- Will you work the counter, manage from the back, or hire a manager?
- Can the current team cover the owner’s shifts, and will they stay?
- What hours do you realistically want to give each week?
- Will the seller train you for a set period before leaving?
Be honest about the answers. For related ground, see the guide to buying a café in Canada.
Related reading
15 pages on the same subject, grouped by topic.
Buying
- GuideHow do I buy a cafe in Canada?
- GuideBuying a café or coffee shop in Canada
- Expert answerIs owning a café worth it?
- Expert answerHow do I tell if a detailing business relies on one fleet or dealer client?
- Expert answerHow do I find out if a snow business relies on subcontracted plow trucks?
- Expert answerHow do I see how much an optometry clinic relies on its optical lab supplier?
Due diligence
Selling
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 03Business Development Bank of CanadaGovernmentBuying a business? How to protect yourself from potential liabilities
- 04Business Development Bank of CanadaGovernmentMajor pitfalls to avoid when negotiating a purchase agreement
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