Summary

This is a hair saloon located within the Harare CBD and near a busy flea market. The saloon has a strong customer following built up over the years and presents a good stepping stone into the industry. The are currently 50 hair dressers paying US$200.00 and expenses are approximately US$3,000.00. A long lease can be negotiated as the seller owns the property.

1. History Background

Fully describe the business's activities

The business is hair saloon business with manicure and pedicure that operates by renting out facilities to hair dressers. These hair dressers pay US$200.00 per month to use the faccilities, fittings and equipment. There are currently 50 hairdressers that are tenants to the business. The chairs, mirrors, trolleys, hair dryers, tables are the property of the owner and the hairdressers only maintain small consumables in their possession like rollers and hair products.

How long has the business been established

The owner established the business 8 years ago.

What steps are in place to solve "load shedding" problems

None

What is the average KW usage

30Kva

2. Present Market

How does the business operate on a daily basis

The receptionist is responsible for opening the premises each morning. The business operates from 7am to 7pm on most days, but busy periods and holidays result in late openings.

How are the clients attracted to the business

Word of mouth. Newspaper adverts & flyers.

What Advertising/Marketing is carried out

Print media adverts and flyers are the more consistent mode of advertising

What competition exists

Ebony Hair Saloon, Fragrant Hair Saloon

What are the seasonal trends

Summer is the peak as most women are outgoing in the summer months

3. Financial

Is the business VAT Registered

Yes it is Vat registered and all documentation is on file

Are there up-to-date Management Accounts available

The latest is 2008

What Balance Sheet and Income Statements are available

there are no balance sheets and income statement available

What percentage of of the business is cash/credit

All cash

How could the profitability of the business be improved

(1) The use of highly branded hair products and hair chemicals. (2) The sale of dress accessories for women

What is the payback period

25 months

What is the ROI

50% per annum

4. Staffing

What is the total staff complement

5 staff members

Give a breakdown of staff/functions/length of service

The average length of service is 10 years

How involved is the Owner in running the business

The owner is directly involved and manages the rent-a-chair tenants

5. Premises

When does the current lease end

A long lease can be negotiated for 3 -5 years as seller owns the property

Is there an option of renewal & what period

To be negotiated

What are the trading hours

7am-7pm - 7 days a week

What is the square meterage of the business

2,200 square metres

Do you require a licence

City Council Shop Licence

6. Assets

Are any items not included in the sale

Rollers, Towels, Clippers and Blowers belong to the tenants

What is their overall condition

Fair

Do any require repairing

No

How have they been valued.

Owner's Valuation

Are they presently insured

No

7. S.W.O.T. Analysis

Strengths

(1) Recognised brand in middle to mass market segment (2) Good location near flea market

Weaknesses

(1) Lack of branded hair products

Opportunities

(1) Hair accesories and banded hair product sales

8. Reason For Sale

What is the reason for the sale

The seller is joining her children in the U.K

9. Conclusion

Why is this a good business

Good location and makes money. Low cost model.

What is the price plus stock and the net profit

Selling Price-US$250,000.00/ Profit US$7,000.00