Food production businesses for sale

A food business in Denmark must be registered with the Danish Veterinary and Food Administration (Fødevarestyrelsen), and the new owner has to arrange that registration. Check what applies to this specific type of production and whether approval is required on top of registration. Ask for the latest inspection reports (the smiley scheme) and whether there have been orders or product recalls. The own-check programme, traceability and supplier approvals should be documented so you can carry on from day one.

Then look at the sales channels. Does the business supply supermarket chains, wholesalers, restaurants or consumers directly? Chain agreements bring volume, but often price pressure, promotional demands and listing terms as well. Ask whether the agreements can be assigned and when they are renegotiated.

Recipes and brands are often the most valuable things you buy. Make sure they are written down and owned by the company, not by the owner personally. Review purchasing too: do raw material prices swing a lot, and can the business pass increases on to customers? Shelf life and waste affect the margin more than in most industries.

Food producers are valued with Sitavo’s indicative range for manufacturing: 3–5 times EBITDA, cross-checked against 0.4–1 times revenue. Own brands, several sales channels and clean inspection reports push the price up; dependence on one chain and heavy investment needs in cooling and production equipment pull it down.

• Registration with the food authority and the latest inspection reports.
• Own-check programme, traceability and any recalls.
• Chain and wholesale agreements: term and assignment.
• Rights to recipes, brands and packaging design.
• Condition of cold storage, freezers and production equipment.

See the general advice on buying manufacturing businesses. If you are looking for a place to eat rather than a producer, see restaurants and cafés for sale.