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Annual turnover

  • Mandate: 31445
  • Added: 30 Jul 2018
  • AFS
  • 329

High-end Flooring Company. Leaders in SA.

Gauteng, Johannesburg
Mandate 31445
Added 30 Jul 2018
R 13,000,000* ZAR
Stock: R 4,000,000
Assets: R 6,840,928
R 293,676 ZAR
Erich Haupt
Aldes Optima

Profitable, well-established (25 years) turnkey flooring company. The leaders in high-end flooring importing and installation in South Africa. Offices in Johannesburg and Cape Town.

High-end Flooring Company. Leaders in SA.
R 13,000,000* ZAR
Stock: R4,000,000
Assets: R6,840,928
R 293,676 ZAR

Profitable, well-established (25 years) turnkey flooring company. The leaders in high-end flooring importing and installation in South Africa. Offices in Johannesburg and Cape Town.

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Fully describe the business's activities?
The leader in South Africa - Importers, resellers and installers of high-end timber flooring and timber decking.

How long has the business been established?
The business was established in 1995, therefore 23 years.

How long has the owner had the business?
The owner started the business in 1995 in Johannesburg where the Head Office and main showrooms are still based. There are also showrooms and offices in Cape Town. Durban is serviced from Johannesburg.

How does the business operate on a daily basis?
A GM, who has been with the company for a number of years, has been put in place to run the company on a daily basis. 5 x Managers of warehouses and show rooms open the business each morning. The Operations Managers run the sites and do the planning. The 2nd tier management of this company is very strong and they run the company on a daily basis.

How are the clients attracted to the business?
The client has exquisite show rooms with one particularly large show room in the right area in Sandton showcasing all of their flooring products. They also exhibit at upmarket industry related expo's. The Specifiers, who they employ, continuously visit architects and designers who work on large building projects. These relationships have resulted in excellent repeat business. Upmarket developments and their developers seldom look elsewhere.

What Advertising/Marketing is carried out?
They exhibit at the top industry-related expo's in the country. They advertise in various high-end publications such as Conde & Naste. They also have a presence on social media and have a website. Their showrooms also bring in good business.

Does the business have any contract work?
Yes. Each job is controlled by way of contracts.

What competition exists?
This company is the leader in South Africa for turnkey operations in relation to installation of high-end flooring. The competition in this sector is some way behind.

What are the seasonal trends?
Although December and January are slightly slower due to closing for 3 weeks of builders holidays July to November proves to be exceptionally busy because clients want to complete jobs before December.

Is the business VAT Registered?
Yes, the business is VAT registered.

What VAT documentation is on file?
Normal monthly VAT returns.

Are there up-to-date Management Accounts available?
Yes, up-to-date Management Accounts are available.

What Balance Sheet and Income Statements are available?
The Annual Financial Statements and related documents for February 2018 are available.

What percentage of the business is cash/credit?
They ask for 70% of the contract upfront, another 20% is asked for when materials are about to be delivered to site and 10% is paid on completion of the job. This company therefore has a good cash flow.

What is the age analysis of the debtors book?
30 days in general but almost 90% of all jobs are paid upfront.

How could the profitability of the business be improved?
The commercial building sector has not really been pursued to the extent that it could be. There is still huge potential on this front with corporate clients. They could probably double the business. A BEE purchaser of this company will be even more advantageous for getting contracts in the commercial and corporate sector. However BEE has never been a hindrance to them in the market in which they operate.

What is the total staff complement?
There are 120 employees.

Give a breakdown of staff/ functions/ length of service?
A staff organogram of the 120 staff is available to qualified interested parties.

Do any receive special perks or incentives?
Site Managers receive a quarterly bonus on performance which is based on square meters completed.

Are they on contract?
Yes, the employees have letters of appointment.

Do any have management potential?
Yes. There are numerous managers in place from Operations, to Site to Show Rooms and Warehouses. 2nd tier management is very strong.

How involved is the Owner in running the business?
The MD is involved but there are many managers within the company who can be relied upon to run the business as they do when the owner is on extended holidays etc. A longstanding employee has also been appointed as GM to oversee the business on a daily basis and this is working out very well.

When does the current lease end?
The current lease at Head Office ends in 2020.

Is there an option of renewal & what period?
Yes, there is an option for renewal of 3 to 5 years.

What is the annual escalation %?
The annual escalation is 10% but negotiable.

What are the trading hours?
Show rooms: 9.00 am to 5.00 pm. Administration and Head Office: 8.00 am to 5.00 pm Monday to Friday: 6.00 am to 5.00 pm (Installers and Site personel).

What is the square meters of the business?
Johannesburg : 1 x 750 square meters and 3 x 500 square meters . Cape Town premises - 1 x 200 square meters.

Is a copy of the lease available?
Yes, a copy of the lease is available.

What lease deposit and/or other surety is required?
1 x month deposit or surety is required.

Are any items not included in the sale?
Yes. There are two luxury vehicles which the owner will keep: 1 x Toyota Prado and 1 x Porsche Cayenne.

What is their overall condition?
All are in very good to excellent condition.

Do any require repairing?
No. All in excellent working in order.

Which assets are on lease/HP and with whom?
There are some vehicles, photocopiers and the switchboard, all of which are required to run the business effeciently and optimally, which are on lease.

Will Seller settle or Buyer to take over?
Other than the two luxury vehicles which are not a part of the sale the other vehicles etc which are on lease/H.P are essential to the running of the business. Therefore they will need to be taken on as part of the purchase to ensure continued services, sales and productivity. The expenses related thereto are included in the financial report.

Are copies of agreements available?
Yes, all copies of agreements are available.

Are they presently insured?
Yes, all insured comprehensively.

This is a turnkey operation. They supply and install. The leaders in South Africa in the high-end sector. Excellent 22 year history. Knowledge in this sector is unsurpassed (across all staff). They have a loyal, non-unionised staff. The brand is well-known in the industry.

None really, due to the high-end sector in which it operates. More effort could be made in the commercial sector. This could be a huge positive for the new owners to move into this sector more aggresively.

Any movement into the commercial sector will contribute to bottom line immediately.

Normal economic conditions - but having said that, this company operates in the high-end, high-net-worth sector which tends to still have money to spend on their homes etc despite the economic climate.

What is the reason for the sale?
The sellers have purchased a business overseas which they now want to run. There is a GM in place who runs the business on a daily basis. The owners still have a home in Johannesburg and another smaller business here so will be coming back to SA on a monthly basis.

Why is this a good business?
The leader in South Africa. Works throughout the country from Sandton to the West Coast in high-end developments and with high-net-worth individuals. The brand is well known and respected in the industry. Loyal staff. Nicely profitable.

What is the price plus stock and the net profit?
The owner is asking for R9 million plus stock at cost of approximately R4 million. The adjusted net profit to February 2018 is R3 524 000. This price includes equipment and vehicles of approximately R6.6 million.

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Aldes Optima

1 members
5 active mandates
P.O. Box 588

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