1. The Basics of Restaurant Valuation
Valuing a restaurant in Nepal requires looking beyond the standard book value of kitchen utensils and furniture. A buyer is purchasing future cash flow, customer goodwill, the existing commercial lease, and operating infrastructure.
2. The Seller's Discretionary Earnings (SDE) Method
For owner-operated hospitality businesses, the international and Nepali standard is Seller's Discretionary Earnings (SDE).
3. What Drives Your Multiplier (1.5x vs 3.0x)
Why do some cafes sell for 1.5x SDE while prime Thamel or Jhamsikhel eateries command 3.0x?
- Long-Term Transferable Lease: A minimum 3-5 year registered lease with fixed annual escalation.
- Clean POS Records: Verifiable electronic sales history reconciling with bank receipts.
- Staff Retention & Standard Operating Procedures: Kitchen head chef and floor manager staying post-sale.
4. The Asset-Based Valuation Method
If your restaurant is currently operating at break-even or a slight operating loss, buyers will value it on an Adjusted Net Asset basis (kitchen equipment, fit-out, and location rights).
5. Nepal-Specific Nuances: IRD Taxes & Lease Rights
Two legal complexities unique to Nepal routinely make or break hospitality deals: PAN/VAT Liabilities and House Rent Tax (Ghar Bahal Kar).
6. How to Prepare 3-6 Months Before Selling
Before publishing your listing on Paisoo, spend 90 days cleaning up your financial records. Separate personal expenses from official company bills, ensure employee contracts are signed, and build a clean digital data room.