Fully describe the business's activities?
Steers and Debonairs Fast Food franchise.
How long has the business been established?
How long has the owner had the business?
How does the business operate on a daily basis?
Staff arrive, start food preparation and then serve takeaway and delivery orders throughout the day
How are the clients attracted to the business?
National advertising and prominent signage. Located in popular shopping centre.
What Advertising/Marketing is carried out?
Franchisor advertises nationally on TV, sign boards and print media.
Does the business have any contract work?
What competition exists?
The usual fast food outlets
What are the seasonal trends?
Year end is usually quieter as people go away and then come home with little money left.
Is the business VAT Registered?
What VAT documentation is on file?
VAT returns for due diligence
Are there up-to-date Management Accounts available?
What Balance Sheet and Income Statements are available?
No - part of a group financial structure
What percentage of the business is cash/credit?
30% cash, 60% card and 10% online
What is the age analysis of the debtors book?
How could the profitability of the business be improved?
More owner involvement in the day to day operations. Savings can be made in cost of sales and general maintenance with owner involvement
Is Seller finance available and for what amount?
What is the total staff complement?
Give a breakdown of staff/ functions/ length of service?
3 managers 4 front of house (cashiers) 9 kitchen staff and chef 4 delivery drivers
Do any receive special perks or incentives?
Are they on contract?
Do any have management potential?
How involved is the Owner in running the business?
General oversight of day to day operations but not involved operationally on a daily basis
When does the current lease end?
Is there an option of renewal & what period?
Yes - negotiable
What is the annual escalation %?
What are the trading hours?
9 am to 9 pm daily
What is the square meters of the business?
Is a copy of the lease available?
Do you require a licence?
What lease deposit and/or other surety is required?
2 month's rent
When and how often is a revamp required?
Every 5 years. This store was revamped on May 2017 at cost of R700,000, so next will be in May 2022
What are the main assets of the business?
Equipment, signage, counters, fridges, freezers etc. 4 delivery bikes are included.
Are any items not included in the sale?
What is their overall condition?
Fair to good
Do any require repairing?
How have they been valued ?
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?
Two well known national brands and part of the Famous Brands group. Consistent quality throughout the country ensures returning customers.
Seven day week requires managers to help run the stores.
With hands on management, savings can be made on various purchases and maintenance oversight in the store
General economic issues, but these can benefit takeaways whilst negatively affecting restaurants.
What is the reason for the sale?
Owner is spread too thin to control too many businesses.
Why is this a good business?
Good opportunity to acquire an established franchise, for less than the startup cost of a similar outlet.
What is the price plus stock and the net profit?
Price is R2,200,000 plus stock (at estimated cost) R40,000 as a going concern (zero rated) to a VAT registered purchaser. Additional cost is franchise joining fee of R67,840 per brand, so R135,680 [payable to franchisor).
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Annual Turnover Amount between R 500 thousand and R 6 million