Buying a Business Case Study
| Age: | 33 | | When: | July 2006 | | Total spent: | £60k (for the leasehold) | | CV: | “I had been working since I was 15. After I left school I worked in the restaurant trade – Thai, Chinese and Indian. I also went into business ventures with my family.” | | Key advice: | “Take your time and do your homework.” |
 | | Flavours5 | Mohammed Eijaz moved to England from Bangladesh when he was only three years old. Thirty years later he is the proud owner of a 46-seater Indian restaurant in Stratford-upon-Avon. He says the restaurant, called Flavours, is luxurious with a warm ambience, friendly atmosphere and a specialism in authentic Indian cuisine. Eijaz had the culinary pedigree to run his own restaurant, having spent much of his time since the age of 15 working in the restaurant trade. These experiences also gave him motivation, as he explains. Limited options “I worked a lot for and with my family. I’ve had a few partnerships with close relatives but I felt I wasn’t getting what I wanted from them. I felt a little cheated because I never got any appreciation and all the credit was awarded to other people.” In September 2005 Eijaz decided it was time to search for a business of his own. He knew exactly the kind of place he wanted to run, it was just a case of finding the right location without exceeding his tight budget. “It had to be the right business. I knew what I wanted to do: create a restaurant serving Thai, Indian and Chinese cuisine. My options were limited, though, because I had such a small investment available.” Given his restrictive budget, it was always going to be difficult to find a business that was both thriving and in a good location. But fortunately, although you can’t move a building, you can renovate it, overhaul the decor, hire new staff and change the menus. “This business came to me by chance — and I grabbed the opportunity with both hands. Once I had been to view it I knew it was perfect. "The previous business trading on these premises had been going downhill. The restaurant was trash and the inside hadn’t been touched for about 25 years. "But I saw the potential.” The previous owner wanted a quick sale. This was perfect for Eijaz, who needed to get the price as low as possible. “I knew from my research that the average value of somewhere like this was about £100k,” he says, “but I ended up paying just £60k for the leasehold. I also knew that because of the state of the restaurant it was going to be a lot of work. However, I believe that as long as I keep putting the effort in I could sell it for twice what I paid for it. It was just too good an opportunity to pass up. We paid a great price for the business — some would say we got it cheap.” No rush When it comes to buying a business, says Eijaz, patience is a virtue. “It was worth waiting for. Making a decision like this should never be rushed. "It took me a year to find the right place, but I wasn’t going to just buy the first place I saw. I was waiting for the right balance of factors to appear. "Because I had been involved in buying and running businesses before [with his family] I had a little knowledge of the process, so I did my research, especially about the area. I looked up a lot of statistics — what kind of people live in the town, that kind of thing.” Luckily for Eijaz, he had a friend who also runs a restaurant in Stratford. “He definitely gave me the best advice. If he wasn’t running a successful restaurant, there was no way I was going to start running a similar outlet in the same town.” One thing that you can never account for is trouble with the neighbours. Eijaz had a minor run-in with one of the local residents shortly after beginning renovation work on the restaurant. “The guy was putting in complaints when we were trying to redecorate,” he recalls. “He kept complaining to the council — we had all the departments come and visit us.” Raising finance for his venture was also a problem. Eijaz had always worked in his family’s businesses, but raising finance in his name only proved difficult. “A lot of lenders turned me down. In the event, I got a loan through my bank.” Lack of space Although Eijaz is pleased with his business, he didn’t quite get what he wanted. “If I had a second chance I would opt for a bigger place,” he admits. “I want to create an atmosphere but this place is not big enough. It is a cute little restaurant but there is not the space to cook Thai, Indian and Chinese food. "I want all the waitresses in traditional dress. I want the restaurant to be a fusion of these countries and their cuisine. "But unfortunately, we just don’t have the space to do it yet. What we have is good, and although it is just an Indian restaurant, for the budget and everything it is fantastic. "I just can’t realise my full dreams here and I want to impress more.” Looking to the future, Eijaz reveals that he already plans to extend the restaurant and double its capacity. He’s also on the lookout for a second business. “I am going to expand. I will keep this restaurant open, but within the next two years I want to open a second, bigger place where I can create the business I have always wanted.” Meanwhile, Eijaz’s immediate concern is raising the profile of his existing restaurant. “I am struggling because the reputation of this place before I took over was bad. I need to get people through the doors and change their opinions,” he says, before adding intriguingly: “I do have one or two ideas up my sleeve.” Eijaz is clearly a man enjoying finding his own way. “It is better when you don’t have your family involved. You do your own hard work. "When you are doing something and when you achieve something you feel good — no one else gets the credit for it.” | 
