For the would-be entrepreneur, a food and beverage industry option can be very attractive. After all, each one of us must eat and drink to be able to survive and we have to pay much attention to the fundamentals! While this may be the case, there are many complex and interrelated issues to consider before you buy a business involving an existing restaurant and it’s important to bear in mind that less than one in 10 purchases will actually succeed. It is very important to value the business correctly upfront and if you go about your due diligence correctly you will have a good chance of surviving against these awful odds.

When you begin trying to buy restaurant business assets, you’ll quickly learn that one of the key skills you’ll require is the ability to decipher information and to communicate effectively. You will need numerous meetings with the seller and don’t be surprised if the early ones don’t reveal some fundamental facts and figures. It is natural for the seller to be a little protective and to want to gauge your enthusiasm and see whether you are really serious and qualified before divulging delicate data.

Before you can start projecting a position in the future, you need to know some basic facts and figures. How many tables are there in the restaurant and what style of food does it focus on? You need to know how many meals are served per day, per week and by month and if the menu is somewhat specialized, are the supplier contracts strong enough and is the supply chain sufficient?

Labor is a major cost in any business and particularly here. How do the costs breakdown in this particular business and be careful if the strength of the organization is entirely based on certain personalities, key figures, or even the master chef. You may not expect to get a lot of the finer details during the early process, as a seller often wants to keep any news of a potential sale away from the employees until the appropriate moment.

Write up a check-list of questions to ask the owner; you should have hundreds and not be afraid to be very specific, nor to insist on detailed answers. Before you even go there, however, understand that this kind of business involves very long hours and is typically a seven days per week concern. You will definitely be required to be good at managing people, dealing with significant problems and you might have to be patient before you can expect to see any profit from your endeavours.

Some of the challenges you may well face as a new owner include the ability to consummate new relationships with your suppliers. Sometimes certain suppliers may view a change of ownership as their chance to amend contracts to their benefit. You must be able to deal with distraught people, who may be upset because their table is not available, even though they booked it but arrived late. You must be able to motivate your employees and be able to handle all situations immediately, resulting in praise or termination accordingly.

When you’re sure that you are cut out to buy business interests in the restaurant industry, have tabled the right questions and received the comprehensive answers, are happy with your interpretation of the financials and contracts, then you are ready to discuss the value. Always work with knowledgeable experts in the field who have experience in the restaurant industry and use their findings to backup your own thoughts. If you know what the business bottom line is, the salary take of the owner, net profits and owner benefits, then you should adjust this figure according to any capital expenditure you feel is important.

With a restaurant for sale, expect your three major costs – food, labor and rent to be no more than two thirds of your total expenses and make sure that you have a first-class marketing plan so that you can tell the world about your new baby.

Richard Parker is the author of the How to Buy a Good Business at a Great Price series. As President and founder of Diomo Corporation - The Business Buyer Resource Center, his materials, seminars and consulting have helped thousands of business buyers realize their dream to buy a business.