How do I tell what a pizza shop owner actually takes home?
List what the owner is paid through wages, draws and perks, note any family members on payroll, then price the shifts the owner covers on dough, oven and driving as if you hired staff to do them. What is left is closer to what you would take home, and your accountant can confirm the method.
A seller’s summary of what the shop earns does not tell you what you would put in your own pocket. This is a personal question: if you stand where the owner stands, what is left after you pay for everything the owner now does for free? The steps below help you answer it from records rather than from conversation.
What the owner is paid today
Ask how the owner is paid: a wage, a draw, dividends, or a mix. Look for personal costs that run through the shop, such as a phone, a car or meals. Ask for the records that show each one. The point is to see the whole picture of what the owner receives, not only the line called salary.
Family members on payroll
Many pizzerias are family operations. Ask who works there, how many hours each person puts in and what they are paid. Compare what relatives are paid with what the job would pay a hired employee, and confirm the comparison with your accountant. Ask whether those people plan to stay.
The shifts the owner covers
Ask which jobs the owner does: morning dough, running the oven, closing, or driving when a driver does not show. Then work out what hiring someone for those hours would cost you. This page on owner hours explains how to see whether the shop depends on one person.
Bringing it together
- Owner pay, draws and personal costs paid by the shop.
- Family payroll, compared with market pay for the same jobs.
- The cost of replacing each shift the owner works.
- What you need to cover your own household.
Ask your accountant to walk through the numbers with you.
Related reading
15 pages on the same subject, grouped by topic.
Buying
- Expert answerHow do I tell if a pizzeria relies on the owner’s own hours?
- Expert answerWhat should I check before buying an independent pizzeria?
- Expert answerShould I buy an existing pizzeria or open a new one?
- Expert answerShould I buy a pizza franchise or an independent pizzeria?
- Expert answerHow do I check a pizzeria’s delivery-app sales before buying?
- Expert answerHow many hours will I work after buying a convenience store?
- Expert answerWill the technicians stay after I buy an auto repair shop?
- Expert answerWhat should I check before buying a sandwich shop?
- Expert answerHow do I check the ovens before buying a pizzeria?
- Expert answerHow do I tell what a vape shop owner actually takes home?
- Expert answerHow can I tell if a driving range for sale is profitable?
- Expert answerWhat should I check before buying a gelato shop?
- Expert answerWhat should I check before buying a bagel shop?
- Expert answerHow do I tell if a gift shop is too dependent on the holiday season?
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 CanadaGovernmentAfter buying a business, what is the next step?
Deavo is an advertising and listings platform, not a brokerage, law firm or valuation firm. This page is general information, not legal, tax, accounting or valuation advice, and rules differ by province. Confirm anything you rely on with a qualified professional before you act on it.