Michael Aronovici on How a Restaurant Brand Deal Actually Comes Together, Start to Finish

Why This Process Matters

Buying a restaurant brand looks simple from the outside. Someone signs a document, a logo changes hands, and a new owner runs the business. In practice, the work that makes a deal succeed happens long before the signatures and long after them. The gap between a brand that survives a change of ownership and one that does not usually comes down to what happens in those two stretches of time.

Michael Aronovici has spent more than 30 years inside that gap. As President and sole owner of Interaction Restaurants Group, he has acquired, stabilized, repositioned and sold restaurant and franchise businesses across Canada, including the Cultures chain and Salisbury House. That span of deals, done across different brand sizes and different kinds of trouble, is what makes his view of the process worth hearing.

Step One: Know What You Are Actually Buying

The first stage of any acquisition is not financial. It is operational. Before a number gets attached to a deal, someone has to walk the business and find out what state it is really in.

For a franchised brand, that means looking past the head office financials and into the franchisee base itself. A chain can show healthy system-wide revenue while individual locations are quietly failing. Aronovici's approach when he took on Cultures, then a 60-location franchisor, was to look directly at financial problems inside the franchisee base rather than at the brand's top-line numbers. That is where the real risk sits in any franchise acquisition, and it is the part a purely financial buyer is most likely to miss.

Step Two: Fix the Foundation Before You Grow It

Once a deal closes, the instinct for a new owner is often to start expanding right away: new locations, new markets, new menu items. Aronovici's record points to a different order of operations. At Cultures, the work after the purchase was to stabilize operations and address the financial problems within the franchisee base first. Only after that foundation was solid did the brand get repositioned for its next phase.

This sequencing matters because growth amplifies whatever is already true about a business. Adding stores on top of a shaky franchisee base does not fix the base. It just creates more locations with the same problems.

What Stabilizing Actually Looks Like

Stabilizing a franchise system is not one task. It usually involves several at once:

Reviewing which franchisees are profitable and which are not, and why
Resetting supply arrangements where costs are out of line with what franchisees can sustain
Rebuilding trust between head office and the franchisee base where it has broken down

None of these show up in a press release. All of them determine whether the next stage of a deal, the growth stage, has anything solid to build on.

Step Three: Reposition, Then Grow

Once the operational problems are addressed, a brand is ready to be repositioned for its market. This is the stage most people associate with "turning a brand around," but it only works if the earlier stabilizing work already happened. A repositioning built on top of unresolved franchisee distress tends to produce the same outcome twice.

This is also the stage where licensing and development rights come into play for brands expanding into new territory. Aronovici's work securing the exclusive license to develop and operate Starbucks Coffee in Eastern Canada is an example of this kind of growth-stage negotiation: rights, territory, and operating standards all have to be worked out before a single new location opens. The same was true of the development rights he held for P.F. Chang's in Ontario, Quebec and Atlantic Canada, where the work involved introducing the brand to the Canadian market and opening the first locations.

Step Four: Know When the Deal Is Done

The final step in the process is the one buyers think about least when they start: deciding when to sell. A brand that has been stabilized, repositioned, and grown has a window where it is worth the most to the right buyer. Waiting past that window does not usually add value. It adds risk.

Aronovici's deals bear this out. Pizza Hut in Quebec was sold after a decade of growth, to a company controlled by John Bitove. The Starbucks license was sold back to Starbucks Corporation after seven years of negotiations, expansion and operations. Cultures was sold to a company controlled by the Serruya family and is now part of MTY Food Group. In each case, the sale came at the point where the brand's trajectory was clear to a buyer, not after it had plateaued.

The Order Is the Point

What separates a well-run acquisition from a poorly run one is rarely the price paid at the start. It is whether the buyer does the diagnostic work first, fixes the operational base before growing it, and recognizes the right moment to exit. Skip any one of those steps, and the deal that looked good on paper on day one can still fail by year three.

For anyone evaluating a restaurant or franchise acquisition, the practical takeaway is to resist the pressure to move straight from purchase to expansion. Diagnose the franchisee base, fix what is broken, and only then decide how fast to grow. The brands that last are the ones where that order was never skipped.