Summary

This business is a major player in the printing industry in Namibia. It's services include large-scale printing, binding, and publishing. A design department is part of the business. The business has a number of contracts in place, and has a very good relationship with a number of important customers. Some of its machines are the only ones of their kind in Namibia. And to top it off the staff is well trained and committed! Price: N$7 million; average monthly profit: N$230 000

1. History Background

Fully describe the business's activities

This business is active in all aspects of the printing industry, including large scale printing, sorting, and binding. The company can print everything from business cards, pamphlets and annual reports to customer statements and envelopes for big corporates. Finished goods are delivered to the client. The business includes a graphic design department to assist clients. Some of the machines owned by the business are unique to Namibia and thus give it a good competitive advantage.

How long has the business been established

The business is in existence for 37 years.

How long has the owner had the business

The seller has owned the business for the past 4 years.

2. Present Market

How does the business operate on a daily basis

The company is roughly divided into three departments: finance, design and production. The largest, production, is overseen by a production manager. A production meeting takes place every day with the owner to plan the day. The owner himself is responsible for quotations and customer relationships.

How are the clients attracted to the business

Many clients hear about the business through word of mouth.

What Advertising/Marketing is carried out

No advertising is being done at present.

Does the business have any contract work

A number of service contracts are in place. The business also has recurring work that is almost as good as having a contract in place.

What competition exists

There are numerous printing companies in Namibia, and even South African companies can be called competition in some cases.

What are the seasonal trends

There are some times in the year when the workload goes up drastically due to the nature of some clients needs when overtime is necessary to cope with the workload.

3. Financial

Is the business VAT Registered

The business is VAT registered.

Are there up-to-date Management Accounts available

Management accounts to December 2010 are available.

What Balance Sheet and Income Statements are available

Full financial statements up to the year ending on 30 April 2009 are available, as well as draft statements to 30 April 2010.

What percentage of of the business is cash/credit

Most clients are on 30 day accounts, though some are on a cash basis. The business has 30 day accounts with its suppliers.

What is the age analysis of the debtors book

All debtors will be collected by the seller, so the buyer starts with a clean sheet.

How could the profitability of the business be improved

The profitability could be increased by increasing sales, though at some level this will also require further investment.

Is Seller finance available and for what amount

Seller finance is not available.

What is the payback period

The payback period is 29 months

What is the ROI

40%

4. Staffing

What is the total staff complement

The business employs 20 people.

Give a breakdown of staff/functions/length of service

Most of the employees work in the printing production department. The critical staff members are the production manager, printer and the designers. Staff turnover is very low. Most workers are multi-skilled so that things don't come to a standstill when someone goes on holiday etc.

Do any receive special perks or incentives

All employees work on a basic salary and receive overtime pay. Some are on a pension scheme, and production bonusses are paid at the end of the year to those who have performed exceptionally well. The head designer receives a commission on new clients that he brings in.

Are they on contract

All staff have contracts, and the seller will pay out all outstanding leave pay etc on takeover.

Do any have management potential

The production manager is doing a very good job as it is. The chief designer has potential, and is already in the process of taking more responsibility, like making quotations and handling the front office. He can also be the reponsible person when the owner is away.

How involved is the Owner in running the business

The owner is very involved in the running of the business. Most important are management skills, though some technical-mindedness helps. He does all marketing, pricing and customer liasion himself.

5. Premises

When does the current lease end

The lease is renewable annually.

Is there an option of renewal & what period

The landlord will be happy to keep the business in the premises.

What is the annual escalation %

Escalation is 10% negotiable.

What are the trading hours

8 - 17 for clients, but workflow dictates the hours to the staff.

What is the square meterage of the business

About 500 sqm under roof.

6. Assets

Is a full asset list on file

A full asset list is on file.

Are any items not included in the sale

All assets in the list are included in the sale.

What is their overall condition

All assets are in good working condition.

How have they been valued.

The assets have been valued at fair value.

Which assets are on lease/HP and with whom

Some assets are on HP.

Will Seller settle or Buyer to take over

The seller will settle all HP's and pay all suppliers.

Are they presently insured

All assets are insured.

7. S.W.O.T. Analysis

Strengths

The business offers clients a very good service and great quality. Prices are reasonable, but it does not compete on price.

Weaknesses

Capacity limitations.

Opportunities

Opportunities are equal to the Namibian market.

Threats

Competition.

8. Reason For Sale

What is the reason for the sale

The owner has other opportunities that he would like to pursue.

9. Conclusion

Why is this a good business

The business is on a strong footing in the market and has a skilled and commited team of workers. The assets are in mint condition.

What is the price plus stock and the net profit

The price of the business is N$7 million, and monthly profits are around N$230 000 on average.