Sectors / Category

Annual turnover

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  • Mandate: 32226
  • Added: 15 Aug 2018
  • AFS
  • 278

Air Conditioning Experts doing contract work for mines over a large area

Limpopo,
278
Mandate 32226
Added 15 Aug 2018
R 2,750,000* ZAR
Stock: R 150,000
Assets: R 1,442,293
R 47,225 ZAR
Arie Roos
(PRINCIPAL)
Aldes Longtom
Mpumalanga
Mpumalanga
Summary

Experts is air conditioning and cooling . Serving mining companies with the installation , maintenance and repairs of commercial and residential AC and cooling systems .

Air Conditioning Experts doing contract work for mines over a large area
SELLING PRICE AFS
R 2,750,000* ZAR
Stock: R150,000
Assets: R1,442,293
R 47,225 ZAR
Summary

Experts is air conditioning and cooling . Serving mining companies with the installation , maintenance and repairs of commercial and residential AC and cooling systems .

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Fully describe the business's activities?
The business specialize in the service , repair and supply of air conditioner units and has now branched out to now cover the vast market of refrigeration . This includes the repair , service and supply in all refrigerator and cool room aspects Contract work is done for many mining companies and a vast area is serviced by five skilled mobile teams On a smaller scale the business is also retailing in cooling / refrigeration spare parts and AC gas The business has a loyal customer base and is also giving back into the community by offering training and skills courses to to young entrepreneurs

How long has the business been established?
8 years ago

How long has the owner had the business?
Since 2010

Mission statement
As a fast growing company their mission is to always make sure that customers receive excellent service and top quality products Fast response time is achieved by five technical teams that are always on hand . All technicians receives regular refresher courses from various suppliers and training facilities They strive to employ local people and many skilled staff members were produced in the last few years by the bi-annual refrigeration courses they offer

How does the business operate on a daily basis?
The general manager is active in following up on contract work / e-mails and phone calls on a daily basis . He oversee the control of the stock / equipment and vehicles . Technical teams book out they vehicles / tools / equipment and stock on a daily basis and respond to contract projects and call-outs . The admin assistant keeps track on payments and debtors and communications .The admin assistant also handles the smaller retail side of the business where electrical and cooling components are sold to the public

How are the clients attracted to the business?
Exciting and expanding contracts with mining companies A sound reputation and word of mouth

What Advertising/Marketing is carried out?
Roadside advertising signs , booklets , Social media platforms and booklets The business has a Representative that visits mines and core customers in the area The owner also has a vast network of business contacts

Does the business have any contract work?
Yes Many contracts are in place with the local mines to install and service air conditioners units at the residential developments and offices . This contracts are very sought after and not easy to secure During the quieter winter months the business profits highly from serving exciting AC units .

What competition exists?
No real competition - this business is a market leader in this area

What are the seasonal trends?
During a period of 9 months the area is extremely warm - the business is very busy and the demand for all types of cooling is very high . During the few cooler months the focus is on annual service contracts and maintenance . During this period the staff also get a chance to go on leave

Is the business VAT Registered?
Yes

What VAT documentation is on file?
Yes , VAT clearance certificate is available

Are there up-to-date Management Accounts available?
Yes

What Balance Sheet and Income Statements are available?
2017 / 18 statements are available

What percentage of the business is cash/credit?
Cash business about 30 % Contract business of about 70 % is on credit

What is the age analysis of the debtors book?
The age analysis of the debtors varies from 90 to 120 days . This can be between R300k and R 500k The seller will include this debtors with the sale - meaning that the buyer will be sure of an immediate income . Note that managing the cash flow with such a debtors book is crucial

How could the profitability of the business be improved?
The business has cheap rental space available to sell AC , refrigerator and coldroom spare parts directly to the public . New appliances can be sold directly to the public Repaired and re-conditioned refrigerators and other electrical appliances can be sold to the public at high margins . Currently the business is building relations with management of shopping malls - when installed air conditioning systems are out of warranty this business is taking over the maintenance contracts and will also most likely do the replacement of older systems From this relationship the business is starting to supply cleaners to malls - cleaning ablutions and also servicing higenic dispensers in the malls . This also offers a opportunity to branch out and start a new venture in the rendering of cleaning services and the supply of cleaning materials .

Is Seller finance available and for what amount?
No

What is the total staff complement?
10

Give a breakdown of staff/ functions/ length of service?
7 of the employees is with the business for more that 7 years The others are employed by the business for more than a year

Do any receive special perks or incentives?
The service teams are receiving performance bonuses and sales commissions One of the managers is making a 50% contribution to the company vehicle and has the option to buy the vehicle at the end of the financing term

Are they on contract?
Yes

Do any have management potential?
Yes , but it is advisable that the buyer will be directly involved in the running of the business The manager ( owner ) will be available to consult for a month after the sale of the business at an agreed salary

How involved is the Owner in running the business?
The owner is 100 % involved in the business . He ensure good relations with the key customers and network to obtain further contracts . He manages and signs off the work forms from his admin assistant The owner has very good systems in place to track the technical teams's vehicles and work progress to ensure that work and tasks are done productively Systems are in place to control orders / payments / tools / equipment /

When does the current lease end?
3 years

Is there an option of renewal & what period?
Yes , there is an option for a further 3 years

What is the annual escalation %?
10%

What are the trading hours?
Weekdays from 7h30 to 17h00 Saterdays from 7h30 to 13h00

What is the square meters of the business?
100 square meters Used for office space , storage and spare space can be utilized as retail space Secure parking space is available for the vehicles

Who is the Owner/Landlord?
Lionel de Aqvira

Is a copy of the lease available?
Yes

Do you require a licence?
No

What lease deposit and/or other surety is required?
No

What are the main assets of the business?
The main assets in the business is the following : Relative new reliable vehicles that are on hire purchase Specialized tools used in the trade Air Conditioner stock and parts ( expensive air conditioner stock is not carried but is easily ordered from the agents )

Are any items not included in the sale?
No , all inclusive The one manager has the option to take of the vehicle he is using after the financing term

What is their overall condition?
The vehicles are new and are under a maintenance plan

Do any require repairing?
No

How have they been valued ?
Owner valuation

Which assets are on lease/HP and with whom?
Vehicles are financed by Wesbank and the printer with Selco

What are their settlement amounts?
Schedule available ( about R 250 000 / vehicle ) The monthly installment on the vehicles is about R 30 000

Will Seller settle or Buyer to take over?
The buyer will take over the HP of the 5 vehicles

Are copies of agreements available?
Yes

Are they presently insured?
Yes

Strengths?
This business is the market leader in a huge mining area where there is constant growth The business over diversified services to a vast spectrum of clients Strong long term contracts Skilled and dedicated workforce

Weaknesses?
Expensive business to operate Stock is expensive and cash flow need to be strictly controlled Although the contracts with the mines are of a great benefit - the payment terms of 60 to 90 days calls for strict cash flow control

Opportunities?
New mines are planned in the area and the current mines are expanding . This is very warm area - air conditioning and cooling is a necessity . Besides the mines there is a broad base of clients - Lodges , Supermarkets , Filling stations , Malls , Funeral services , Residential projects , Schools and many offices are also making use for their products and services

Threats?
Staff need to be monitored . Effectiveness is key The "" reputation "" of the business is just as good as the previous job completed

BEE status
The business is at a Level 3 BEE Procurement recognition @ 110% Expiry date 6/4/2019

What is the reason for the sale?
Owner considers immigration with family

Why is this a good business?
This business has tripled in size in 3 years time , and is positioned to build on this growth . a High gross profit can be obtained Growth opportunities in a diverse market in a growing mining hub .

What is the price plus stock and the net profit?
Selling at R 2.75 million ( including stock at R 150 000 and debtors at R 400 000 ) When personal expenses of the owner is written back the nett profit before tax is about R 570 000 / annum

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FRANCHISE DETAILS

Aldes Longtom

2 members
12 active mandates
Mpumalanga
31 Fourie Street
1120

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