Fully describe the business's activities?
Welding & cutting equipment and consumables including repair & supply of welding equipment. Sole Distributor of quality welding equipment and accessories . Special application products and consumables come with test certificates.
How long has the business been established?
The Owner initiated the business 20 years back and is currently operating the business successfully.
How does the business operate on a daily basis?
The business representative visits the regular niche clientele. The focus is on selected corporates and businesses that use quality welding accessories. The welding industry is important and therefore essential to use quality products . The Agency/ Supplier sends referrals to the business of clients requiring the niche product in the area.
How are the clients attracted to the business?
Word of mouth Regular clients in the engineering field.
What Advertising/Marketing is carried out?
None at this stage . The Owner is comfortable with his current customer base . The opportunity exists for the Purchaser to advertise and expand the business into new heights
Does the business have any contract work?
We shall refer to "supply agreements" with mines , steel manufacturing companies & engineering companies. Diverse client supply base factories , mines & agriculture. The business is listed on major vendor lists due to niche product sold.
What competition exists?
A minority due to Niche product. The competitors focus on cheaper welding consumables & lack good customer care.
What are the seasonal trends?
The business is consistently growing with several peaks reached during certain months in the year. The business closes in December due to suppliers and certain customers closing for the vacation. The business is pro active in purchasing stock and leaving consignment stock with trusted customers.
Is the business VAT Registered?
Yes the business is compliant
What VAT documentation is on file?
VAT documents are with Auditor available to serious buyers only
Are there up-to-date Management Accounts available?
Yes. Available to serious buyers only
What Balance Sheet and Income Statements are available?
AFS 2018 - pending . The Business operates on Pastel software programme Sales & Costing is available quickly at the click of a button Accurate reporting and figures on the ALDES income statement is Excluding VAT.
What percentage of the business is cash/credit?
Cash clients 5 % Account clients ( Debtors ) payment EFT 95%
What is the age analysis of the debtors book?
30 - 90 days Debtors (Actual Payment due) 2.5 % discount on Creditors early settlement
How could the profitability of the business be improved?
Advertising and Social Media . Extend the existing product range and scope of supply to customers.
What is the total staff complement?
7 Staff members
Give a breakdown of staff/ functions/ length of service?
1 x Financial Manager ( operating pastel system ) - 18 years ( Owners wife ) 1 x Debtors / Machine repairs admin - 7 years 1 x Sales rep - 10 years ( basic salary + commission on turnover) 1 x Creditors - 3 months 1 x Workshop / Driver - 14 years 1 x Workshop - 8 years 1 x Workshop - 7 years 1 x cleaner / tea lady - 13 years
Do any receive special perks or incentives?
The Owners firmly believes that staff is an asset an rewards and motivates them accordingly . End of year bonus are in the form of a 13th cheque / gift from the Owners Incentives are given when the business is performing well and staff efforts are rewarded. Long years of service confirms happy staff and excellent Owners of the business.
Are they on contract?
All staff have contracts as per the Labour laws.
Do any have management potential?
Yes. Majority of the staff members can be left on their own to perform their work functions successfully without supervision. Each staff member takes ownership of their scope of work.
How involved is the Owner in running the business?
The Owner is involved in the daily operations of the business however the team is experienced enough to operate successfully on their own. The business success lies in the product supplied , availability and service delivery of product. The Owner can be replaced. The business can be managed with strict stock controls. Much of the service and repair works is outsourced to reliable network companies and they will continue this service . However it is always more beneficial when the Owner is involved in the business.
When does the current lease end?
Year to year lease . The business has been renting this premises for the past 16 years and there is no need to end the lease . Customers prefer a stable location .
Is there an option of renewal & what period?
Yes. Option to renew available.
What is the annual escalation %?
What are the trading hours?
Monday to Friday 7:30am to 5pm No Saturdays No Sundays Closed on public holidays Will certainly assist important clients in need .
What is the square meters of the business?
Is a copy of the lease available?
Yes . Only to serious buyers.
Do you require a licence?
No business license required. It will be a benefit if Buyer has some knowledge regarding welding & accessories and technical knowledge However this is not compulsory since the work can be outsourced. The main focus is currently on the selling of welding accessories .
What lease deposit and/or other surety is required?
Landlord shall request 1x months deposit & 1x months rental in advance.
What are the main assets of the business?
Asset on file
How have they been valued ?
Which assets are on lease/HP and with whom?
Fintech - printer & copier @ R506pm 12c per copy ( allowed 2500 copies per month )
What are their settlement amounts?
2 x Company vehicles shall be settled before effective date of sale
Are they presently insured?
Business Insurance with a reputable company @ R2000 per month Car track R135 pm
1. The Business focuses on a Niche Market 2. Quality product at affordable prices 3. Committed and trained staff 4. Excellent operating system 5. Well organised Store room & clearly defined stock items.
1. Expand the current product range 2. Supply all the Vendors sister companies since the product is already a stock listed item. 3. Employ more representatives in the field 4. Expand the workshop with specialized work.
What is the reason for the sale?
Owner feels the need for change . 20 years in the industry is a long stable and successful history and desires to relocate .
Why is this a good business?
Product , quality , availability and service excellence.
What is the price plus stock and the net profit?
R 4.5 million Estimated Stock R1.5 million . Purchaser will pay for stock in access of this amounts. Debtors for the benefit of Seller Creditors the Seller will Settle. Assets are fully paid for.
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