Should I buy an existing restaurant or open a new one?
Buying an existing restaurant gives you a kitchen, a team, regulars, a lease and a track record you can examine. Opening new gives you a blank slate with your own concept and no inherited problems, but you build everything yourself. Choose by how much risk and rebuilding you want.
The choice comes down to what you would rather have: something already running that you must understand, or something empty that you must build. Neither is easier, and each fails in its own way. Think about your skills, how much cash and patience you have, and whether you want to improve a place or invent one.
What an existing restaurant gives you
An existing restaurant comes with a kitchen that works, a team that knows it, regulars and a record of how it has traded. You can ask to see that record and watch service before you commit. The cost is that you also inherit habits, equipment age and a reputation. Ask what the seller does each day and what you would need to learn to take that over.
What a new opening asks of you
Starting new means you choose the space, design the kitchen, hire and train the team and wait for customers to find you. There is no track record to inspect, and every supplier account and approval starts from nothing. You decide the concept, but your own plan and cash have to carry the ramp-up.
How to compare them honestly
Write down what each path needs from you in time, money and skill, and ask what you could not fix if it went wrong. A lease on either route is a long commitment, so have your lawyer read it. Your accountant can help you test your plan, and a lender will set its own terms. Our restaurant due diligence page lists what to request when you look at a running restaurant.
Related reading
15 pages on the same subject, grouped by topic.
Buying
- Expert answerHow do I transfer a food premises licence when buying a restaurant?
- GuideHow to buy a restaurant in Ontario: licences, ownership rules and what transfers
- GuideHow to buy a restaurant in Quebec: licences, ownership rules and what transfers
- GuideHow to buy a restaurant in British Columbia: licences, ownership rules and what transfers
- GuideHow to buy a restaurant in Manitoba: licences, ownership rules and what transfers
- GuideHow to buy a restaurant in New Brunswick: licences, ownership rules and what transfers
- GuideHow to buy a restaurant in Newfoundland and Labrador: licences, ownership rules and what transfers
- GuideBuying a café or coffee shop in Canada
- Expert answerHow do I read a fast food franchise’s brand audit reports before buying?
- Expert answerWhat should I check before buying a Vietnamese pho restaurant?
- Expert answerWhat should I check before buying a Korean BBQ restaurant?
- Expert answerWhat should I check before buying an Italian restaurant?
- Expert answerWhat should I check before buying a Greek restaurant?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
- 02Business Development Bank of CanadaGovernmentAfter buying a business, what is the next step?
- 03Business Development Bank of CanadaGovernmentBusiness plan template for entrepreneurs
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