Summary

This take-away pizza place has only recently been established, but it is showing good profits and strong growth. You will never see it for this price again! Price: N$240 000, profit around N$20 000 per month.

1. History Background

Fully describe the business's activities

This is a take-away pizza business that also does deliveries. The business also sells ice-cream and hamburgers.

How long has the business been established

The business started trading in August 2010.

How long has the owner had the business

The current owner bought the business in December 2010.

2. Present Market

How does the business operate on a daily basis

The business buys its pizza bases from a local supplier. Virtually all the toppings are pre-cooked in the day so that the business can stay on top of things when things get busy in the evenings. Deliveries are done by the owner, while all the other functions are being carried out by staff.

How are the clients attracted to the business

The business has a very good location, which is perhaps the most important thing. The business premises have been colorfully branded to attract potential clients. Word of mouth also plays an important role.

What Advertising/Marketing is carried out

Initially some advertising was done in newspapers, however, this has been discontinued. Flyers in the suburbs around the business have been distributed and have proven successful, yet the greatest success have been bulk SMS's (1500 numbers on the list) and bulk e-mails (500 addresses on the mailing list).

Does the business have any contract work

There is no contract work.

What competition exists

There are a number of pizzerias in Windhoek, and all of them are competition to some extent. There is one other pizzeria in the area that is being targeted as a market by this business. To certain segments of the clientele this business has virtually no competition.

3. Financial

Is the business VAT Registered

The business is VAT registered.

Are there up-to-date Management Accounts available

Up to date management accounts are available.

What Balance Sheet and Income Statements are available

Income statement and balance sheet as of February 2011 are on file.

What percentage of of the business is cash/credit

This is a cash business, though a credit card machine is available for clients.

Is Seller finance available and for what amount

Seller finance is available, depending on the situation.

What is the payback period

The payback period is one year or less.

What is the ROI

100%

4. Staffing

What is the total staff complement

The business employes three people.

Give a breakdown of staff/functions/length of service

The staff are all trained to handle all the day to day functions in the business, like taking order, working the cash register and making pizza.

Do any receive special perks or incentives

The staff receive overtime pay.

Do any have management potential

Although the employees can work independently and don't require constant supervision, the owner has to be involved and make sure that everything runs smoothly when the place is very busy.

How involved is the Owner in running the business

The owner opens and closes the business every day, does daily cash-ups, regularly checks inventory and makes sure that prices are right. They also take care of marketing & advertising, as well as deliveries (of which there aren't many)

5. Premises

When does the current lease end

The lease ends in July 2010.

Is there an option of renewal & what period

The lease has to be renewed annually.

What is the annual escalation %

The annual escalation is 7%.

What are the trading hours

11h00 - 22h00.

What is the square meterage of the business

The size of the premises is 80 - 100 sqm.

6. Assets

Is a full asset list on file

An asset list is on file.

What is their overall condition

As the business is still quite young all the assets are also essentially new.

How have they been valued.

The value of the assets reflects their historical cost

Which assets are on lease/HP and with whom

All assets are fullly paid for.

7. S.W.O.T. Analysis

Strengths

The location of the business is its greatest strength, together with the quality of its pizza.

Weaknesses

The business is not very active throughout the day, and does the vast majority of its sales in the evening.

Opportunities

The sellers have already arranged to have an area in which a few chairs and tables can be set up so that clients can eat on site. This would also enable the business to become a small coffee shop during the day. A light liquor licence could also be applied for. The business could do more cross-marketing with businesses and sports clubs in the area, and also market its products to corporates.

Threats

None perceived.

8. Reason For Sale

What is the reason for the sale

The owners have too many businesses and can't really give this one the attention it deserves.

9. Conclusion

Why is this a good business

Although this business is new it is already profitable. With the right attention given to it the solid base it now has can be used as a springboard to greater things.

What is the price plus stock and the net profit

The price of the business is N$240 000, and the net profit is N$20 000 per month.