Summary

This well established off-set litho printer located to the north of the Durban CBD has a reputation for quality, reliability and personal service. Business is mainly repeat business from long standing satisfied customers. The competent staff have many years service. An opportunity exists for a new owner to expand the business.

1. History Background

Fully describe the business's activities

Offset litho printing on paper, items such as leaflets, books, letterheads, business cards, training manuals, brochures, catalogues, work books for publishers, educational printing, and business forms eg order books, invoice books, delivery notes, statements

How long has the business been established?

The current owner established the business 29 years ago in 1983.

2. Present Market

How does the business operate on a daily basis?

Machine operators manage the specialist printing machines according to production schedule and finishing operators collate, bind, number and trim orders for delivery. Design work is done by two desk top publishing operators. Owner's wife does the bookkeeping. The owner calls on customers and solicits business. The owner manages the business as well as calling on customers and canvassing for additional business.

How are the clients attracted to the business?

Advertising in the Yellow Pages attracts customers. Personal service, reliability and quality attracts repeat business from satisfied customers. The owner calls on regular and potential customers in selected areas.

What Advertising/Marketing is carried out?

Yellow Pages

Does the business have any contract work?

No

What competition exists?

Competition is fierce in printing industry but service retains business

What are the seasonal trends?

November/December peak sales months and April/May generally quiet months.

3. Financial

Is the business VAT Registered?

Yes

What VAT documentation is on file?

All VAT documentation is on file.

Are there up-to-date Management Accounts available?

Management accounts for the calendar year from January to December 2011 are available from which the figures reflected in this mandate have been extracted. The owners personal expenses have been added back to the profit shown in the management accounts.

What Balance Sheet and Income Statements are available?

The Annual Financial Statements prepared by a registered accountant and auditor for the financial year ended February 2011 are on file.

What percentage of the business is cash/credit?

90% of sales is on credit to long standing repeat customers.

What is the age analysis of the debtors book?

Approximately 45 days.

How could the profitability of the business be improved?

Introduce digital colour and litho colour printing. Create a website. Increase customer base. Improve sourcing of materials.

Is Seller finance available and for what amount?

No.

What is the payback period?

22 months

What is the ROI?

54%

4. Staffing

What is the total staff complement?

6 staff + owner and his wife

Give a breakdown of staff/functions/length of service?

General Manager (2 Years), Production Manager (20 years), Designer (29 years), Print Machine Minder (5 years), Finishing (5 years), Finishing (4 years). Owners wife does bookkeeping and her salary is included in salaries expense. As well as managing the business the owner does the selling to customers.

Do any receive special perks or incentives?

13th cheque paid to staff in December every year

Are they on contract?

No

Do any have management potential?

Yes

How involved is the Owner in running the business?

Fully involved.

5. Premises

When does the current lease end?

31 January 2013

Is there an option of renewal & what period?

One year

What are the trading hours?

Mondays to Fridays 7.30am to 4pm

What is the square meters of the business?

167 m2

Is a copy of the lease available?

Yes

Do you require a licence?

No

What lease deposit and/or other surety is required?

One months deposit for rent, water and electricity.

6. Assets

Is a full asset list on file?

There is a full list of assets on file. The photo copier and switchboard are on rental.

Are any items not included in the sale?

The owners vehicle.

What is their overall condition?

Good condition and well maintained by a reputable company in the printing industry.

Do any require repairing?

No

How have they been valued ?

By an independent valuator

Which assets are on lease/HP and with whom?

None

Are they presently insured?

Yes

7. S.W.O.T. Analysis

Strengths?

The business has an enviable reputation built up over 29 years for quality, reliability and professional personal service. The name of the business is a registered trademark. Long serving staff.

Weaknesses?

None perceived

Opportunities?

Increase the depth of marketing by creating a web site and direct marketing to targeted businesses/organisations. Introduce digital colour and litho colour printing. Employ an experienced print sales representative

Threats?

None

8. Reason For Sale

What is the reason for the sale?

The owner and his wife are emigrating to Australia.

9. Conclusion

Why is this a good business?

This is a solid, well established, reputable printer which an enthusiastic entrepreneur could use as a platform and grow the business through the introduction of digital colour printing.

What is the price plus stock and the net profit?

The price of the business is R1,588,000 plus stock of R12,000. Total price R1,600,000. Net profit for last 12 months R863,921