Owners of restaurants and cafes often start their business quite simply: they find premises, buy equipment, furniture, and appliances, and begin operating. Some items are bought new, some second-hand, and some are purchased gradually over time. Documents for the equipment may get lost or simply not be kept. As long as the business is operating, this usually does not cause any problems.
But at some point there is a need to formalize the property officially. For example, to contribute it to the charter capital of a company, to change the composition of founders, or to prepare the business for sale. That is when it becomes clear that the equipment exists and is in use, but legally it must be properly described and its value must be determined.
It is in such situations that restaurant property valuation is most often required. In valuation practice, this is one of the most typical tasks, especially for small and medium-sized businesses.
When restaurant property valuation is most often needed
There may be many reasons to conduct a valuation, but to speak plainly and without unnecessary theory, in most cases it is about contributing property to the charter capital of a company. This is a common working situation that business owners face when they want to put their documents in order or change the structure of the company.
For example, a restaurant owner may have worked for several years as an individual entrepreneur or under a simplified form of business. Later, a decision is made to establish a company or bring in a partner. In order to formalize everything properly, the equipment and furniture must be officially transferred to the business. And for that, their market value must be determined.
Valuation may also be needed when selling a business, arranging financing, liquidating a company, or resolving disputes in court. But contributing property to the charter capital remains the most common and practical scenario.
What is included in restaurant property
Many people think a restaurant is just a kitchen and a few refrigerators. In reality, the list of assets is usually quite extensive and includes dozens of items. And these are not only expensive pieces of equipment, but also ordinary things without which the establishment simply cannot operate.
Property in the guest area
The dining area of a restaurant or cafe contains a large share of the furniture and equipment used every day. These include tables and chairs, sofas, a bar counter, decorative interior elements, televisions, air conditioners, and audio equipment. Some establishments also have safes, video surveillance systems, projectors, or special lighting.
At first glance, such items may seem ordinary, but they are always taken into account during valuation. This is especially true if the furniture was custom-made or if professional design solutions were used.
Kitchen equipment
The most valuable part of restaurant property is, of course, the kitchen. This is where the equipment is concentrated, without which it would be impossible to cook and store food. In a typical restaurant, one may find refrigeration and freezer cabinets, induction cookers, deep fryers, ventilation hoods, dishwashers, refrigerated tables, and ice makers.
In more professional kitchens, steam convection ovens, bain-maries for keeping dishes warm, grills, dough mixers, vegetable cutters, vacuum packers, and coffee machines are often used. Such equipment is not cheap and requires careful inspection during valuation.
Sometimes the list also includes power generators, especially if the establishment operates under conditions of possible power outages. This is no longer just equipment, but an element that ensures business continuity.
Utility rooms and storage
A separate part of the property consists of shelving, sinks, stainless steel worktables, scales, packing equipment, and cleaning supplies. These things rarely attract much attention, but without them neither the kitchen nor the storage area can function.
Some establishments even have their own ventilation systems or refrigerated chambers for storing food. All of this is also part of the property and is taken into account when determining value.
What to do if there are no documents for the equipment
The absence of documents for equipment is one of the most common situations in the restaurant business. Many entrepreneurs buy equipment and furniture gradually: some items are new, some used, sometimes purchased for cash or without formal paperwork. After several years, finding the original documents can be difficult or completely impossible.
This does not mean that a valuation cannot be carried out. In valuation practice, such cases arise regularly, and there are clear working solutions for them. The main thing is that the property actually exists, is used in the company’s operations, and is available for inspection.
During the work, the specialist inspects the equipment, checks its technical condition, records its main characteristics, and analyzes the market for comparable items. It is on the basis of this information that the market value of the property is determined, even if the documents are missing.
Case study: formalizing restaurant property without documents
In our practice, there was a case where the owner of a small restaurant decided to formalize the business under a legal entity. The establishment had already been operating for several years and had a sufficient customer base, but the property actually belonged to an individual. The premises were rented, and the equipment had been purchased gradually, part new and part second-hand.
When the issue of contributing the property to the charter capital arose, it turned out that there were no documents for most of the equipment. Some receipts had been lost, and some purchases had been made without any formal documentation at all. This is a fairly typical situation for small businesses.
In such cases, clients often worry that it will be impossible to carry out a valuation because, according to common belief, only the owner of the property can order a valuation. In fact, the law does not state it quite that way. A valuation may be ordered not only by the owner of the property, but also by a person who legally possesses that property on lawful grounds.
Therefore, if the founder or director of a company officially rents the premises where the equipment is located, the appraiser has the right to value that property and prepare a report for its contribution to the charter capital.
After inspecting the equipment, a detailed inventory of the property was compiled, photo documentation was prepared, and a market analysis was conducted. As a result, the owner received an official valuation report that allowed the documents to be formalized without difficulty and the business to continue operating.
Why it is important to prepare the property list correctly
One of the key stages of valuation is preparing the property list. The more accurately it is prepared, the faster and easier the entire process will be. In practice, the list may run to several pages and include dozens of items, from large refrigerators to small utensils and accessories.
For example, a typical restaurant may contain refrigerated tables, freezer units, deep fryers, induction cookers, ventilation hoods, dishwashers, power generators, tablets for taking orders, receipt printers, ventilation systems, and even water heaters.
Owners often forget to include small items that seem insignificant. But together they can make up a noticeable share of the total property value.
How long does restaurant property valuation take
The time required depends on the amount of equipment and the complexity of the property. If there are not many assets and the list has been prepared in advance, the inspection can be completed within one day. After that, the appraiser analyzes the information and prepares the report.
In most cases, the entire process takes several working days. This is normal practice and allows for obtaining an accurate and legally valid document.
Types of tableware and cutlery: reference information
One of the main difficulties an unprepared person may face when visiting a restaurant is the large number of tableware and cutlery items. Guests may be presented with several spoons and forks, unusual knives, and other peculiar utensils whose purpose is not immediately obvious. That is why such numbered diagrams are often used as reference material for staff and restaurant owners.
In restaurant property valuation practice, we also regularly deal with a large amount of inventory and tableware. In large establishments, the list of such items may include dozens of positions, from special knives and forks to various tongs and serving spatulas. During valuation, it is important to correctly identify the type of each item, its purpose, and the actual quantity.
Below is one of the most illustrative examples of the classification of tableware and cutlery. This scheme can be used as reference information during inventory and restaurant property valuation, and it also helps to quickly understand the different types of utensils used in food service establishments.
1 coffee spoon
2 teaspoon
3 dessert spoon
4 classic tablespoon
5 large confectionery tongs used for serving finished products
6 cocktail spoon
7 asparagus tongs
8 ice tongs
9 small confectionery tongs for chocolate and sugar
10 cigar guillotine (this item can also sometimes be found at the table, of course, if smoking is allowed in the restaurant)
11 fork intended for lemons
12 serving fork (has two prongs used for picking up small cold appetizers)
13 cocotte fork for hot fish appetizers
14 and 15 blunt paddle-shaped knife intended for fish main courses and a fish fork with a special groove needed for separating bones from fish
16 and 17 knife and fork for desserts
18 and 19 another type of knife and fork for dessert
20 and 21 knife and fork intended for appetizers
22 and 23 another type of knife and fork intended for eating appetizers
24 serving ladle
25 and 26 table knife and fork intended for all main courses except fish
27 confectionery spatula for sweets
28 spatula for pâtés
29 elongated fish spatula
30 spatula intended specifically for serving caviar
31 special spoon for eating ice cream in the form of a spatula with slightly bent edges
32 special grapefruit knife
33 knife intended for cutting cheese
34 utensils for eating lobster
35 knife for dishes such as pizza
36 table utensils needed for carving meat
37 utensil for squeezing juice from a lemon
38 tongs for sugar cubes
39 spoon for serving ice cream
40 small deep spoon for serving sugar
41 spoon and fork intended for serving and mixing salads
42 salad tongs
43 special tongs for serving spaghetti
44 special spaghetti fork
In addition to the fish forks, spatulas, and knives shown in the first image, one may also encounter some other variations of these utensils:
45 spatula intended for serving fish dishes with special slots
46 two-pronged fork for herring
47 another possible version of utensils for eating hot fish appetizers
48 fork for sprats and sardines; a version without the top crossbar is also often found
This list of utensils is fairly universal and can be used both in small cafes and in large restaurants. In property valuation, such items are usually grouped as inventory or tableware, but in higher-level establishments their quantity and variety can be significant.
If a restaurant has been operating for many years, the inventory accumulates gradually: some items are bought new, some are replaced, and some are added as the menu expands. That is why, during valuation, it is important to carefully check the actual presence of such items and account for them correctly in the overall property list.
