Running Restaurant Business for Sale Al Majan                          

1. 
   

   Location & Size:

   
   
   
   
   
   • Size: 667 sq. ft.
   
   
   • Location: Al Majan, which is a developing area with residential and commercial activity.
   
   
   
   


2. 
   

   Financials:

   
   
   
   
   
   • Rent: AED 75,000 per year (AED 6,250 per month).
   
   
   • Selling Price: AED 350,000 (including stocks).
   
   
   • Monthly Sales: AED 90,000.
   
   
   • Monthly Expenses: AED 30,000.
   
   
   • Net Profit: AED 10,000 per month.
   
   
   • Agency Fees: 10% of the selling price + VAT (AED 30,000 + VAT).
   
   
   
   

Profitability Breakdown:

• Monthly Sales: AED 90,000 in revenue.


• Monthly Expenses: AED 30,000 (this includes rent, staff salaries, utilities, and other operational costs).


• Rent: AED 6,250 per month (included in expenses).


• Net Profit: After all expenses, the business generates a net profit of AED 10,000 per month, which totals AED 120,000 per year.

Return on Investment (ROI):

• Selling Price: AED 300,000 (including stocks), with AED 10,000 net profit per month.


• Based on the current profit, it would take approximately 30 months to recover the initial investment (excluding any potential growth or changes).

Considerations:

1. 
   

   Current Profit Margin: With monthly sales of AED 90,000 and expenses of AED 30,000, the net profit margin is AED 10,000 per month. Although the profit is consistent, it may be considered relatively low compared to the sales volume. Investigating potential areas for cost reduction or revenue growth could increase profitability.

   
   


2. 
   

   Stock Included: The selling price includes stock, which adds value. You should evaluate the stock to ensure it is current and valuable for the business's ongoing operations.

   
   


3. 
   

   Agency Fees: The 10% agency fee of AED 30,000 + VAT should be factored into the overall cost.

   
   

Recommendations:

• Revenue Growth: There may be opportunities to expand the restaurant's customer base or introduce new offerings to increase monthly sales and net profit.


• Operational Efficiency: Review the expense breakdown to determine if there are areas where operational costs can be reduced, thus increasing the profit margin.


• Due Diligence: Conduct a thorough financial review, including detailed monthly sales records and expense reports, to ensure the net profit is sustainable.

This restaurant offers solid sales, but the net profit is modest considering the sales volume. There could be room for improvement in profitability with the right operational strategies.                                                          

About RVRG Real Estate: RVRG Real Estate specializes in commercial and residential properties across the UAE, offering comprehensive real estate solutions. Our services include property sales, where we facilitate smooth transactions ensuring sellers connect with qualified investors. We assist buyers and investors in identifying lucrative investment opportunities, providing tailored leasing solutions to maximize returns. Our market analysis guides informed decision-making, while negotiation support ensures favorable terms. Additionally, our property management services efficiently handle diverse portfolios, ensuring client satisfaction and value creation.