Question: A local restaurateur who had been running a profitable business for many years recently purchased a three-way liquor license. This license gives the owner the right to sell beer, wine, and spirits in her restaurant. The cost of obtaining the three-way license was about $100,000 since only 300 such licenses are issued by the state. While the license is transferrable, only $80,000 is refundable if the owner chooses not to use the license.
After selling alcoholic beverages for about one year, the restaurateur came to the realization that she was losing dinner customers and that her profitable restaurant was turning into a noisy, unprofitable bar. Subsequently, she spent about $5,000 placing advertisements in various newspapers and restaurant magazines across the state offering to sell the license for $90,000. After a long wait, she finally received one offer to purchase her license for $83,000. Was the restaurateur's decision to advertise the license a good decision? Would you recommend that she accept this $83,000 offer?