Buying a Restaurant: The Due-Diligence Checklist

Work it in this order

1. The license file: food permit history, health inspection reports (public — pull them yourself), liquor license status with the ABC, any violations or consent orders.
2. The lease: remaining term + options, rent escalations, assignment clause (can the lease even transfer to you?), whether your own name is on the hook for the rent, landlord consent timeline.
3. The books: 3 years of tax returns (not just P&Ls the seller printed), POS reports, sales tax filings — they must tell the same story. Bank deposits should match claimed revenue within a few percent.
4. The earnings (SDE): rebuild it line by line: owner salary, one-time items, family on payroll, the truck the business "owns". Every add-back needs paper.
5. Equipment: age and condition of the hood, walk-ins, HVAC and the line — a dead walk-in is a $15K–$40K surprise. Serial numbers against any UCC liens.
6. The people: who actually runs the kitchen, who holds the regulars, what happens when the owner leaves — and whether key staff will stay.
7. The obligations: gift cards outstanding, catering deposits, delivery-platform agreements, music licensing, grease and linen contracts.
8. The transfer plan: which permits re-apply in your name, which transfer, and the liquor track — priced and scheduled before the deposit goes hard.

The Opening Pack's due-diligence workbook expands this to roughly 125 items with verify-how notes for each — because the abridged version is where deals go wrong quietly.

Sources: The FirstTableCheck cost + liquor datasets; valuation conventions: CT Acquisitions — Business Valuation Multiplier 2026; BizBen — How to Value a Restaurant in California 2026; 7shifts — How to Calculate Restaurant Value, 2026-10. Dataset checked October 23, 2026. Where a fee or rule is set by a county or city, this page says so instead of guessing a number.