Fully describe the business's activities?
The business is an existing well established and successfully operated franchised security business in the Mpumalanga region.
How long has the owner had the business?
The business has been established since 2008 and the current owner has had the business since 2012.
How does the business operate on a daily basis?
The business is part of a well-known and reputable security franchise in the Mpumalanga region. The franchised business offers the service of alarm and CCTV installations and 24 hour alarm activity monitoring, panic buttons responses, vehicle responsive services, guarding and general technical support and maintenance along with any lawfully related client specified security services required. The prospective franchisee will need to be registered with PRISA and have a grade B in security. In addition the applicant will need to be approved by the main franchisee in the region. The business is well established in the geographical areas in which it immediately operates in with over 400 active clients comprising corporate, business and private residential.
What competition exists?
There are 2 active competitorâs within the immediate vicinity of the business who have not been established as long as the business has but do however pose a threat to each other in terms of soliciting clients form each other. The benefit and advantage the business has is it is under the umbrella of a well-established and reputable franchise and due to its service and been operational in the area for a longer period than the other 2 has the bulk of the residential homes under its protection and surveillance.
What is the total staff complement?
The business has 15 staff members. Comprising the owner/ seller who overall manage the business, 3 guards in the guarding division, 2 employees within the technical support and installations and the booking in and out of stock, 6 in the responsive vehicles, 1 lady in administration and invoicing and 2 ladies in the control room. There is available on file a full list of staff with their length of service and job descriptions within the business. The staff is trained and skilled in their duties required for this industry.
Is there an option of renewal & what period?
The business has the luxury of operating from premises with high visibility and strategically centralized premises within the town. The lease is annually renewable and the landlords will willingly renew the lease with an approved franchisee, partly as reason is due to the fact of having this esteemed security businesses presence and operating in its building is deemed as beneficial to the landlords and their other tenants. The annual escalation is 8%. The landlords will require the prospective lessee to provide 1 monthâs rental as a deposit and the first months rental will be payable, upfront with a thereafter commitment of rental payment on the 1st day of each consecutive month for the duration of their tenancy.
What are the main assets of the business?
The main operational assets of the business are the alarm unit parts which continue to belong to the business, the base stations, CCTV cameras, software, 2 x responsive vehicles, work station equipment, office computers, desks, chairs, generator, telephonic lines and loose tools. The stock comprises panic buttons, batteries and monitoring systems, this is not included in the purchase price. There is a full asset list on file. The assets as seen on the inventory are fully paid for and are the unencumbered property of the seller. All the assets on the inventory are included in the purchase price and sale of the business. The 2 responsive security vehicles used in the business are still under HP and these HP agreements will have to be taken over by the purchaser. There are some personal paintings and models which are the property of the seller and are not included.
The overview of the business.
The business operates under the flagship of one of the biggest most reputable established security companies in the region. The business currently has over 400 active members. The business has massive extra earning potential available by encompassing new clients from the outlying highly populated areas into its current basket of clients. This can be accomplished by aggressively marketing and advertising its services inits immediate area as well as the outlying highly populated areas. Servicing these new areas will require an additional 2 vehicles to patrol as well as additional staff. This expense however if the marketing is implemented correctly and successfully will be absorbed by the exponential new income generated from the new and additional clients obtained. The biggest weakness in the business currently is the owner complacent view of the businesses competitors and lack of attention to the marketing and aggressive expansion into the surrounding areas. Part reason for this is due to a lack of willingness on his part to invest capital into the business which will be required to accomplish this growth and upgrading of the current infrastructure and operational equipment. The seller wants to relocate after 2 years as his children will have completed their schooling so he will therefore either consider a full 100% buy out or a partner BEE or otherwise whose objective will be an eventual full buyout .The business currently operates in a PTY but the seller if he sells 100% of the business wishes to retain the PTY. Any firearms required in the business the new franchisee will have to make their own application for. The potential buyer will be advised to over and above the purchase price, rent and rent deposit consider having some additional capital to invest into the business to take advantage of the expansion opportunity as explained to develop service awareness, drive the business goals and develop market share which will increase revenue .There is a 10% royalty on the businesses monthly income payable to the franchisor .There is no additional joining fee upon purchase of the franchise
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Annual Turnover Amount between R 500 thousand and R 6 million