Les Florets Case
Essay by Roland Sgorcea • September 4, 2015 • Essay • 316 Words (2 Pages) • 4,801 Views
Overview
Les Florets is a two-party transactional negotiation.
On one side, the Les Florets restaurant company is in the process of expanding by buying restaurants and operating them. On one side, the owners of a restaurant would like to sell it. Because the restaurant owners are tired of the running the business, they are getting old and plan on taking a one-year sailing trip around the world while they still in good enough health to enjoy such a trip.
Analysis
The analysis below was conducted to determine the financials of the case and whether a deal could be reached between the two parties.
Owner Desirable Restaurant Value
€60,000 Boat + €80,000 (property)
€20,000 Ready Sail + €60,000 - €120,000 (equipment)
€50,000 Expenses + = €140,000 to €200,000
€20,000 Repairs +
€40,000 Reserve
= €190,000
Break Even if sold @€200,000 => 5 years @ €40,000
BATNA
Restaurant Owner BATNA: no clear one, shorter trip?
Restaurant Owner Reservation Price: €190,000
Les Florets BATNA: buy land in the area and build new restaurant
Les Florets BATNA: €200,000
Negotiation
Based on financial data, there is very little to no room ~€10,000 for negotiation if the restaurant is really worth €190,000 as opposed building a new
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