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  • Mandate: 32365
  • Added: 23 Aug 2018
  • AFS
  • 278

Buy & Sell Second Hand Goods & Pawn Broking...Recession Resilient!

Gauteng, Johannesburg
278
Mandate 32365
Added 23 Aug 2018
R 1,950,000* ZAR
Stock: R 1,000,000
Assets: R 750,000
R -15,922 ZAR
Eduan Swart
(PRINCIPAL)
Aldes Jacaranda
Gauteng, Centurion
Gauteng, Centurion
Summary

Established 2nd Hand Retailer with Multiple Income Streams, excellent positioning within major Metropolitan Area.

Buy & Sell Second Hand Goods & Pawn Broking...Recession Resilient!
SELLING PRICE AFS
R 1,950,000* ZAR
Stock: R1,000,000
Assets: R750,000
R -15,922 ZAR
Summary

Established 2nd Hand Retailer with Multiple Income Streams, excellent positioning within major Metropolitan Area.

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Fully describe the business's activities?
Buy and sell second hand goods in a sought after Metropolitan Area. Offers secured and unsecured loans as part of its business model and standard operations. The premises allows for the trade in larger and bulkier product ranges such as large appliances, gym equipment, office furniture etc...

How long has the business been established?
8 years

How long has the owner had the business?
Since January 2018. Business was bought from previous franchisee, the first owner started the business in 2010 and operated till November 2017.

How does the business operate on a daily basis?
Current economic climate has aided the business to recover far quicker than expected since it was reopened under new ownership. Situated in a major metro area with high foot traffic and surrounded by government institutions means a lot of product is offered and available to buy and in return sell from the retail floor. High demand in loans with a quality repeat customer base.

How are the clients attracted to the business?
Strong local and national marketing campaigns, big focus on digital and social mediums in the territory.

What Advertising/Marketing is carried out?
Flyers, hand outs, banners, and social focused on facebook and Google.

Does the business have any contract work?
No

What competition exists?
Local pawn shops

What are the seasonal trends?
Increase in sales from November to January months, increase in loans between January and April.

Is the business VAT Registered?
Yes

What VAT documentation is on file?
Available on request.

Are there up-to-date Management Accounts available?
Yes, updated monthly

What Balance Sheet and Income Statements are available?
Current

What percentage of the business is cash/credit?
90% cash / 10% credit

What is the age analysis of the debtors book?
n/a

How could the profitability of the business be improved?
The business is starting to show a profit, should growth in stock levels and loan books be maintained (as achieved between January and June 2018) the business should starting yielding R400 000 in monthly sales and EBITDA of R40 000 to R50 000 by the end of 2018.

Is Seller finance available and for what amount?
Yes, R1 500 000 deposit and balance on terms over 12 months

What is the total staff complement?
11

Give a breakdown of staff/ functions/ length of service?
Staff list available on request

Do any receive special perks or incentives?
Yes, staff are incentivised on sales and achieving performance based targets.

Are they on contract?
Yes

Do any have management potential?
Highly skilled and dedicated manageress running the business at present time.

How involved is the Owner in running the business?
Daily oversight.

When does the current lease end?
August 2018

Is there an option of renewal & what period?
Yes, lease will go onto month to month from September 2018. Landlord is a private individual and will conclude a new lease with new owner. Options to relocate available.

What is the annual escalation %?
n/a - industry norm 6% to 8%

What are the trading hours?
6 days a week, Monday to Friday 08:00 to 17:30 and Saturdays 08:00 to 15:00.

What is the square meters of the business?
approximately 600m2

Who is the Owner/Landlord?
Private Individual

Is a copy of the lease available?
Yes

Do you require a licence?
Yes, second hand goods licence and registration with National Credit Regulator

What lease deposit and/or other surety is required?
1 months deposit and personal sureties, can be renegotiated.

What are the main assets of the business?
Shop fitting, fixtures, fittings and equipment.

Are any items not included in the sale?
The Legal Entity Not Included.

What is their overall condition?
Fair, business needs to be revamped within 1 year of purchase.

Do any require repairing?
No

How have they been valued ?
By current owners, balance sheets does not reflect true value based on the sales value brokered with previous owner.

Which assets are on lease/HP and with whom?
Point of sale Hardware, CCTV and Printers.

What are their settlement amounts?
TBC

Will Seller settle or Buyer to take over?
Buyer to take over leases and HP.

Are copies of agreements available?
Yes on request

Are they presently insured?
Yes

Strengths?
Recession Resilient, above average margins because of the trade in second hand goods. 90% of loans are secured (pawn transactions). Dedicated parking area with 12 bays in a highly populated and densely populated Metropolitan area.

Weaknesses?
Remodel / revamp needed.

Opportunities?
Build on 8 years trade record.

Threats?
Strict compliance to the Second Hand Goods Act and existing business protocols is required to limit the possible inflow of stolen product into the business, currently maintained to a minimum. Strict compliance to the National Credit Act is required, currently at highest level of compliance.

What is the reason for the sale?
Current owners bought the business from franchisee to save the business and secure the site and area. The view was to trade the business into profit and then sell it on.

Why is this a good business?
Good area for this type of business, highly visible and sought after corner site. Income derived from loans above average. The equivelant to set up new would cost R3 500 000

What is the price plus stock and the net profit?
Selling for R 1 950 000 inclusive of stock (R1 000 000 in stock).

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FRANCHISE DETAILS

Aldes Jacaranda

2 members
29 active mandates
Gauteng , Centurion
5 Edenvilla 80 Cambridge Road Clubview Centurion 0157
Centurion
0181

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