Summary

Thousands of business patrons & street vendors visit the premises on a monthly basis! Visibility & accessibility is the focal point. Variety of product lines from sweets galore, ,toys ,chips and cigarettes. Fresh tabacco aroma's welcomes you at the door.One can feel the electric vibe of the hawkers & business clients purchasing their stock to start the days activities.The economy is flourishing and thriving knowing they have the support from a major role player in the local area!!!

1. History Background

Fully describe the business's activities?

The business wholesales to "hawkers" , tuck shop owners, small retail outlets & grocery stores selling a variety of packet sweets, cigarettes, tabacco & chips.The business sells kiddies toys, maize meal , juices & juice concentrates.They stock "hubbly bubbly's " and a variety of tabacco flavours.This tabacco & cigarette section of the business is under lock & key to prevent stock losses.Lotto & Airtime is sold on the premises to attract feet to the business.The businessmen/women visit the business themselves and collect their own stock.

How long has the business been established?

The owner initiated the business from humble beginnings to a major successful trading operation in 2003. At first he rented premises and with the fast growth of the business he decided to purchase his own property and build his own warehouse on which the current business now stands.

2. Present Market

How are the clients attracted to the business?

The owner is very in tune with his clients requirements.He ensures that regular promotions in store are driven with "specials" too good to miss. Affordable prices , variety & availability of stock , easy accessible to the CDB and transport facilities.The service is excellent and all clients are treated with the utmost care & friendliness.The business hosts a Nedbank ATM machine on the premises.The purpose is twofold , one to assist those clients in want of cash and secondly to facilitate and control the cash on hand within the business.

What Advertising/Marketing is carried out?

Marketing is a serious aspect for any business growth & public awareness.Granted marketing can be very expensive and hence it will be great to invest in advertising methods such as pamphlets distribution via the "knock and drop " house to house method, internet Facebook , huge posters & signs outside to attract the clientele to the business.Advertising is truly an essential part of the business!!!

Does the business have any contract work?

None and is not necessary.The business is supported by every day business people who rely on this business to stock up their own businesses.Transport is available for the public & those owners without vehicles operating a tuck shop in the local areas.

What competition exists?

We are surrounded by competition constantly.This keeps the prices affordable and the service levels high.The huge chain stores cannot compete with this wholesaler who stocks sweets, snacks & tobacco in bulk.The hawkers preferred choice will be to purchase at a store where the prices are low & and the profits high.

What are the seasonal trends?

During the year the business performs as such: December , January & February are slower than normal months yet still profitable.March, July & September show impressive peaks in the business, with the rest of the months reflecting a constant net profit.The business sells huge quantities for small profits as is calculated in the cost of sales percentage of 93-94% per month.

3. Financial

Is the business VAT Registered?

Yes.All Vat documents are on record at the Accounting firm.Vat 201's will be available on request from a serious buyer.

What VAT documentation is on file?

VAT 201's . On file with the bookkeeper.

Are there up-to-date Management Accounts available?

Yes. The business operates on an "Odyssey " system recording the sales & controlling the stock.The owner may at any time extract a sales report or an "end " of day report to check on profitability & availability of stock items.

What Balance Sheet and Income Statements are available?

February 2011 February 2012 will be completed at the close of the financial year.

What percentage of the business is cash/credit?

CASH SALES ONLY.Only staff members purchase on account and settle at month end.

How could the profitability of the business be improved?

Profitability of the business may be increased by : 1. Increase product lines and expand with the cold beverages section. 2. Open a Take Away.The business is located close to a Taxi Rank .This is a popular product and will be very successful. 3. Install a "barbecue " outside the Take Aways with a "sit in " place for the clients to enjoy a meal. 4. Open a clothing store for the clients already visiting the premises.

Is Seller finance available and for what amount?

Yes. The Seller will consider options. 80% cash of purchase price. 20% Sellers finance of which terms and amounts will be discussed.

4. Staffing

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

10 Staff Members 1x supervisor @ R4257 1x cashier @ R2960 3x general assistance @R2600 each 3x floor staff @ R2200 each 1x security guard @ R2000 1x car guard @ R1200

Are they on contract?

8 of the employees are on contract. Security Guard & Car Guard not on contract.

How involved is the Owner in running the business?

The Owner is the main part of the business although the "business" is not owner dependant.He prefers to be present daily and controls the business in all aspects.The Supervisor reports to the owner regarding all departments , staff issues, purchases and stock.The financial decisions and monetary payments are administered by the owner.He ensures customer satisfaction and needs are met.

5. Premises

What are the trading hours?

Trading hours are : Mondays to Fridays : 8am to 5pm Saturdays : 8am to 1pm NO SUNDAYS

What is the square meters of the business?

Size of the premises : Shop 530m2 Parking 540m2 Total size 1586m2

Is a copy of the lease available?

The premises is belongs to the Owner.The option is open to purchase the property. In the meantime the premises may be rented by the Owner for R30 000pm with an 8% yearly escalation.The contract may be renewed. The Owner is open to discussions regarding terms & conditions.

Do you require a licence?

Yes. Business license.The registration takes place at the municipality with a once off fee. The staff locker rooms and requirements must be adhered too. Fire exits & extinguishers must be checked and certified on a yearly basis.

What lease deposit and/or other surety is required?

The Landlord will request : 1x months key deposit of R30 000. 1x current months rental in advance.

6. Assets

Is a full asset list on file?

Yes . A Full list is available and on file.

Are any items not included in the sale?

Yes. Only personal items of Seller.

Do any require repairing?

In any business, maintenance is a constant feature of the business. Fridges and equipment must be taken care off. The painting & cleanliness of the premises is an ongoing part of the business and ensures continuous operation.

How have they been valued ?

Owner Valued.

Which assets are on lease/HP and with whom?

1x Vehicle. Hyundai Van 2011. The Owner wishes to sell this vehicle. Settlement amount is approximately R200 000.

Will Seller settle or Buyer to take over?

The Vehicle is registered in the Close Corporation and the Buyer may take over the CC and the monthly payments of the Vehicle.

Are they presently insured?

Yes. Bona Fide Insurance .

7. S.W.O.T. Analysis

Strengths?

Strengths : 1. Established business since 2003. 2. The premises is situated within the Taxi Rank. 3. The feet/ clientele have easy access to the business from the location & CBD. 4. This is the closest wholesale trader to the transport amenities in the area. 5. The high turnovers of R2.5 million proves that the "feet" are visiting the business.

Weaknesses?

Weakness: 1. Hands on Business that commands your full attention & focus. 2. Extremely high volumes of stock which could lead to stock losses.Security measures will curb this. 3. No Butchery & Liquor store will be approved due to the competition in the area.

Opportunities?

Opportunities: 1. Wider range of products on the premises. 2. Clothing shop that supports the ethnic groups. 3.Take Away & sit-in for existing client base. 4. Outside barbecue area for the clients. 5. Expand the grocery section of the business with maize & commodity items. 6. Packaging 7. Juices & concentrates in bulk 8. More toys & puzzles

8. Reason For Sale

What is the reason for the sale?

The Owner has other business interests within the local area.

9. Conclusion

What is the price plus stock and the net profit?

R2.4 million R1 million stock R200 000 Assets