Summary

An opportunity to acquire small cost effective tissue paper plant which is made up of tissue roll producing machine, a cutter and sealer. The product is geared and destined for the low end market but with sourcing bulk paper from South Africa one can enjoy better pricing and produce much better quality.

1. History Background

Fully describe the business's activities

The business is comprised of a small plant in a +/-300 square metre factory that produces low end tissue rolls. The overheads are very low and the buyer has the option of re-locating the plant elsewhere or continuing at the current premises. The development designs and marketing materials are included as part of the sale. The plant can produce +/-300 rolls per hour.

How long has the business been established

2 years

How long has the owner had the business

2 years

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

None

What is the average KW usage

+/- 55KVa

2. Present Market

How does the business operate on a daily basis

The business is operated by 3 people and the owner markets the tissue rolls to wholesalers and retail chains within the Bulawayo market.

How are the clients attracted to the business

Direct contact and through word of mouth

What Advertising/Marketing is carried out

None

Does the business have any contract work

No

What competition exists

Softex Tissues and other imported products

What are the seasonal trends

None

3. Financial

Is the business VAT Registered

Yes. But this is not the business that is being sold

What VAT documentation is on file.

No

Are there up-to-date Management Accounts available

No

What Balance Sheet and Income Statements are available

No

What percentage of of the business is cash/credit

Most customers request 7 day accounts

What is the age analyse of the debtors book

None at present as the business is not producing

How could the profitability of the business be improved

Organise the business into a fully fledged factory with a marketing department, that can service the low end market.

Is Seller finance available and for what amount

50% over 3-4 months

What is the payback period

24-30 months

What is the ROI

+/-50%

4. Staffing

What is the total staff complement

3

Give a breakdown of staff/functions/length of service

They would assist new buyer as consultants

Do any receive special perks or incentives

No

Are they on contract

No

Do any have management potential

No

How involved is the Owner in running the business

Involved on the marketing front

5. Premises

When does the current lease end

31 December 2010

Is there an option of renewal & what period

The seller will assist the buyer to negotiate a longer term lease

What is the annual escalation %

None

What are the trading hours

7am to 5pm

What is the square meterage of the business

300 square metres

Is a copy of the lease available

Yes.

Do you require a licence

No

6. Assets

Is a full asset list on file

Only three machines for sale. The tissue roll machine, the cutter and sealer

Are any items not included in the sale

No

What is their overall condition

Very good

Do any require repairing

No

How have they been valued.

Based on landed cost and duty

Are they presently insured

No

7. S.W.O.T. Analysis

Strengths

(1) No one producing tissues in Bulawayo (2) The business comes with operators who can assist new owner (3) Can produce a competitive prices using bulk paper from Kadoma Paper Mills.

Weaknesses

(1) Not aggressively marketed and no dedicated sales person

Opportunities

(1) To create a fully fledged factory with a small sales team

Threats

(1) Imported goods

8. Reason For Sale

What is the reason for the sale

The seller wants to focus on her other business which is now very demanding post dollarisation

9. Conclusion

Why is this a good business

There is no goodwill to pay for but just equipment

What is the price plus stock and the net profit

US$55,000.00