Fully describe the business's activities?
A very succesful family run convenience store with a liquor licence and a take- away situated in a densely populated trendy area near to the city bowl and on a main thoroughfare.The financials for this business have been updated to June 2018 and results show an improved profitability. The average net profit over the previous 12 months is just on R 100 000/month. This is an excellent stable business.
How long has the business been established?
25 years. The business was started by the father and now the three siblings operate it .
How long has the owner had the business?
Since inception 25 years ago
How does the business operate on a daily basis?
The business sells every kind of product one would expect to find in a convenience/grocery store with a liquor licence. They are open from 6am to 11 pm every day of the week and therefore offer huge convenience. The business operates with one cashier and an owner/sibling is always present.
How are the clients attracted to the business?
The store has been in its current position since inception and everyone in the area knows it.
What Advertising/Marketing is carried out?
None besides bill boards outside the shop usually provided by the supplier.
Does the business have any contract work?
What competition exists?
There is a Checkers store in the adjacent street but further up from them which has been there for many years.
What are the seasonal trends?
Summer months are busier but the financials will show that there is not a relevant fall off in winter.
Is the business VAT Registered?
What VAT documentation is on file?
VAT documentation is on file and will be revealed in the due diligence.
Are there up-to-date Management Accounts available?
A detailed management account is available covering Jan 2017 to May 2018
What Balance Sheet and Income Statements are available?
2016 Financials are available
What percentage of the business is cash/credit?
100 % cash via cash/Credit card/Snapscan.
What is the age analysis of the debtors book?
No accounts are held
How could the profitability of the business be improved?
Profitability would be hugely increased : 1. By giving the store a facelift - although quite acceptable as it is, customers would be more attracted to a modernised store. 2. By upgrading the existing take away section to offer a greater variety of food.
Is Seller finance available and for what amount?
What is the payback period?
Who is the bookkeeper/Accountant?
What is the total staff complement?
3 x Partners one of which is always on duty. 5 x employees One employee is always on duty plus one of the partners.
Give a breakdown of staff/ functions/ length of service?
1 x lady in the take away 1 x Cleaning lady 3 x Cashiers
Do any receive special perks or incentives?
Are they on contract?
Do any have management potential?
Yes - this can be discussed.
How involved is the Owner in running the business?
When does the current lease end?
Is there an option of renewal & what period?
There is an option but a new lease agreement will need to be drawn up.
What is the annual escalation %?
What are the trading hours?
6am to 11 pm 7 days a week
What is the square meters of the business?
Approx 150 sq metres trading area and 36 sq metres storage space.
Is a copy of the lease available?
Do you require a licence?
Liquor licence is included in the sale.
What lease deposit and/or other surety is required?
To be discussed with landlord
What are the main assets of the business?
Cool drink fridges, shelving, counters, coldroom, appliances in the take away section.Full list available
Are any items not included in the sale?
Dairy Maid fridge Ola fridge These will be provided by the supplier to the new owner free of charge.
What is their overall condition?
Coldroom is 1 year old . All other equipment is 10 years old.
Do any require repairing?
How have they been valued ?
Fair market value
Which assets are on lease/HP and with whom?
Are they presently insured?
The business has been in the area for 25 years and is very well known as a convenience destination. It is situated in a vibrant densely populated area. The business has a liquor licence as well as a take away which attracts additional custom.
The business has not been upgraded and although acceptable as it stands it would attract more custom if modernised.
Upgrade the shop to give it a modern, fresh looking appeal which will attract greater patronage. Upgrade the food take away section to include a greater variety of food offerings with a lot more visibility. Introduce a coffee offering with a small seating area.
There are no threats. There is no place in the area for the establishment of another convenience store and Checkers is far enough away not to pose any threat and has been there a long time.
What is the reason for the sale?
The 3 siblings took over the business from their father and have been running the business for the last 5 years. They have now made the decision to pursue their own paths.
Why is this a good business?
This profitable convenience store is situated in an ideal position, has no competition, and is making an excellent income for its owners. It is doing all of this despite the fact that it needs an upgrade and further strategic improvements which will, undoubtedly, vastly improve the appeal of the shop thereby improving turnover and profit.
What is the price plus stock and the net profit?
Price plus stock : R 2 700 000 Stock : R 600 000 Assets : R 147 200 Net Profit : R 100 000/month
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