Fully describe the business's activities?
The business is an automotive repair and service centre/workshop, that specialises in: Air Conditioning, Auto Electrical, Brakes, Diagnostics, Driveline, Engine Overhaul, Car Service and suspension.
How long has the business been established?
The franchise has been established for about 30 years.
How long has the owner had the business?
The owner took over the business from previous owner, who had it for the 4 years. He is now in operation since August 2017
How does the business operate on a daily basis?
The business caters to customer vehicles that require minor and major service for the day. They are booked in, checked or diagnosed for parts needed, if there are any required, they are then ordered. Customers are notified of cost involved. Once vehicles are completed, they are collected by owners.
How are the clients attracted to the business?
Marketing by Franchise Head office. There are signs on the street view.
What Advertising/Marketing is carried out?
The owner has google ads for the website,he also advertises on Facebook and puts out flyers in and around the area.
Does the business have any contract work?
There is currently 1 fleet contract that they work on from time to time.
What competition exists?
There are some repair workshops in the area, however they are privately owned and no franchised ones.
What are the seasonal trends?
The business is busiest from November to January when people require their vehicles to be in good working order for the holiday season. During the other months, there is occasional servicing or sales of parts in stock.
Is the business VAT Registered?
The business is VAT registered
What VAT documentation is on file?
The seller has provided VAT returns for our files
Are there up-to-date Management Accounts available?
Yes, the management accounts on file are up to February 2018
What Balance Sheet and Income Statements are available?
The business has been operational with the current owner only from August last year
What percentage of the business is cash/credit?
The business operates on cash or EFT payments, paid on collection of the vehicle
What is the age analysis of the debtors book?
How could the profitability of the business be improved?
By increasing the marketing of the business , aggressive advertising in and around the area. Perhaps running some promotions to attract more customers and obtaining contracts with insurance companies for that regular income.
Is Seller finance available and for what amount?
The seller wants the purchase price paid in full
What is the payback period?
Who is the bookkeeper/Accountant?
Lezanne Viljoen Shachan & Crouse
What is the total staff complement?
3 staff members
Give a breakdown of staff/ functions/ length of service?
A mechanic, an apprentice and a cleaner They have been with the business since it started
Do any receive special perks or incentives?
Yes, there is additional holiday pay and provident fund
Are they on contract?
Yes, the staff have signed contracts
Do any have management potential?
The apprentice has potential for management, once he has completed his program.
How involved is the Owner in running the business?
The owner is there daily and manages the business fully since he has taken over. However the business can run on its own with a manager should the buyer wish to employ one.
When does the current lease end?
The current lease is up to July 2018
Is there an option of renewal & what period?
It is renewable for another 3 years
What is the annual escalation %?
The annual escalation is at 8%
What are the trading hours?
Mon-Fri 8:00- 17:00 Sat 8:00- 12:00
What is the square meters of the business?
The workshop is 115square meters. There are also 6 parking bays, a small office , a kitchen, bathroom plus 4 Hoisters
Who is the Owner/Landlord?
Rosam Properties pty ltd
Is a copy of the lease available?
Yes there is a lease copy on file
Do you require a licence?
A buyer will require approval from the Franchisor.
What lease deposit and/or other surety is required?
The buyer would discuss this with the landlord.
What are the main assets of the business?
Signage and Safety equipment. Timing tool kits. Fuel testing equipment. General workshop tools. Diagnostic Machines. Workshop hand tools. Measurement tools. Pneumatic tools. Office furniture. Workshop furniture.
Are any items not included in the sale?
All items are included in the sale
What is their overall condition?
All in good working condition
Do any require repairing?
No, there is no repairing needed.
How have they been valued ?
The seller will provide current value of the assets.
Which assets are on lease/HP and with whom?
What are their settlement amounts?
Will Seller settle or Buyer to take over?
Are copies of agreements available?
Are they presently insured?
Yes the owner has insurance
The business is conviniently located in a residential area, making it easy for locals to access. It is well equiped.The rental cost is fair for the space it has. Very good mechanic expertise, offers service to a wide brand range, and has the backing of a reputable name.
It does not have street visibility, which would result in customers going to other workshops nearby.
High growth potential with the improvement of marketing. And acquiring fleet contracts, which is big business for this type of business. This will also result in the workshop being the preferred one by local residence.
The security on the premises must always be up to date as the workshop is behind a petrol station and may be at risk of unwanted trespassers late when it is closed.
What is the reason for the sale?
The owner initially purchased the business with the intention to run it simultaneously with his career, however has found himself involved full time and unable to take care of his other career interests. He now needs to focus solely on his career as an engineer and will not have time for the business, therefore has decided to sell to someone who will give it the attention it needs to grow to its maximum potential.
Why is this a good business?
The franchise group has been around for many years and is reliable making it attractive to vehicle owners and insurance companies. High potential of referal business. The workshop is fully equipped and has a high potential of profits with the right business owner who is knowledgeable, they can easily take this workshop to new heights. Its perfectly located behind a petrol station and next to a car wash.
What is the price plus stock and the net profit?
The seller is asking R650 000 plus stock of R153 310 making a net profit of R18 000 per month
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