Fully describe the business's activities?
Petrol filling station franchise with major fuel company. Convenience store plus ATM machine. Situated within a shopping centre boundry.
How long has the business been established?
The business was established in 2006.
How long has the owner had the business?
The one owner has been involved since inception.
How does the business operate on a daily basis?
This is a 24 hour operation. There is Day Manager and a Night Supervisor. One of the owners comes in for about 4 hours a day but is limited due to ill health. The managers largely therefore run the business.
How are the clients attracted to the business?
The location plays a large part in attracting clients - especially taxis.
What Advertising/Marketing is carried out?
None at the moment. Potential to grow shop revenue with specials using pamphlets and posters etc in the area.
What competition exists?
There is another petrol filling station in close proximity but on the opposite side of a very busy dual carriageway.
What are the seasonal trends?
This business is largely constant.
Is the business VAT Registered?
Yes, the business is VAT registered.
What VAT documentation is on file?
Normal VAT returns.
Are there up-to-date Management Accounts available?
Yes there are Management Accounts available. The fuel stock for this business is supplied on consignment. It is only paid to the Franchisor when it is sold. This helps the franchisee in not having to have huge cash resources available to buy fuel stock.
What Balance Sheet and Income Statements are available?
Up to February 2018.
What percentage of the business is cash/credit?
95% cards and cash. There are 2 corporate clients.
How could the profitability of the business be improved?
There is a full takeaway kitchen and counter area in the convenience store that is not being utilised due to the owners ill health. If this is opened it will make a huge difference to bottom line. The car wash (hand wash) is currently being outsourced. It could produce great profits if utilised correctly. If the store is stocked nicely and correctly it will attract more customers and get them to return again and again.
What is the total staff complement?
There are 18 employees.
Give a breakdown of staff/ functions/ length of service?
12 X Petrol Attendants; 5 x Cashiers, 1 x Manager.
Do any receive special perks or incentives?
The staff receive a Christmas bonus of 2 weeks pay. There is also an incentive in place for them to earn R3.00 for every pint of oil they sell during the month.
Are they on contract?
Yes, they have letters of appointment.
Do any have management potential?
Yes, Day Manager in place with a Night Supervisor.
How involved is the Owner in running the business?
The owner is involved about 40% of the time.
When does the current lease end?
The current lease ends on 31 October 2021.
Is there an option of renewal & what period?
Yes, the option for renewal is for 5 years with another 5 on top of that.
What is the annual escalation %?
The annual escalation is 8% per annum.
What are the trading hours?
This is a 24 hour operation - 7 days a week.
Is a copy of the lease available?
Yes, a copy of the lease is available.
Do you require a licence?
Yes, special permit from Department of Minerals and Energy is required.
What lease deposit and/or other surety is required?
2 months negotiable.
What are the main assets of the business?
The main assets are owned by the franchisor. The business owns the office furniture and fittings, IT equipment etc.
Are any items not included in the sale?
What is their overall condition?
Good to excellent
Do any require repairing?
No repairs needed.
How have they been valued ?
Net realisable value.
Which assets are on lease/HP and with whom?
No assets are on lease or HP.
Are they presently insured?
Yes, assets are presently insured.
Location, the brand is famous and sought after, strong taxi market.
One entrance but located within boundaries of a local shopping centre so this also brings in business.
The revival of the takeway counter, taking ownership of the car wash instead of outsourcing it. Potential growth of corporate accounts from businesses in the area. No marketing at the moment - this must be picked up -especially with the opening of the takeaway. Increasing the range in the convenience store.
None really. People will always be buying petrol and food no matter what the economic climate.
What is the reason for the sale?
The health of the partner who is tasked to run this store has taken a set-back in the last year or so and he is not able to give it the attention it deserves and needs.
Why is this a good business?
Location, established, can grow nicely with more owner input. Takeaway and convenience store stocked and managed correctly will make this business even more profitable. Car wash will also bring in customers and revenue.
What is the price plus stock and the net profit?
The owners are asking for R4.475 million plus stock of R125 000 = Total of R4.6 million.
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