Fully describe the business's activities?
This lovely store makes and prepares readymade meals and baked goods which it then sells through the shop. They also do catering for events, bake special occassion cakes and do a brisk lunch time food trade.
How long has the business been established?
The business has been operating from the same premises for 25 years and was started in 1994.
How long has the owner had the business?
The owner originally started the business.
How does the business operate on a daily basis?
The store is opened by the manager who manages the staff, checks stock levels, does any ordering from suppliers that is required and ensures the kitchen staff know what is to be cooked and prepared for the day.
How are the clients attracted to the business?
Mostly word of mouth due to the fact that it has been operating from the same premises for 25 years. There is also a Facebook page and a website. The upmarket community surrounding this store have supported the business over the years as it is a bit of an institution in the neighbourhood.
What competition exists?
There is another store which only sells frozen prepared meals (no fresh meals) about 3 kms away in another suburb. However, they have not really impacted this business due to the fresh option available in this store.
What are the seasonal trends?
Private school holidays tend to be a bit quieter but generally strong activity.
Is the business VAT Registered?
Yes, the business is VAT registered.
What VAT documentation is on file?
Normal VAT returns are on file.
Are there up-to-date Management Accounts available?
Yes, there are Management Accounts up to January 2019.
What Balance Sheet and Income Statements are available?
The Financial Statements for February 2018 are available.
What percentage of the business is cash/credit?
There are no accounts for clients. Most of the monthly income is paid for by cards but there is also a smaller cash element.
How could the profitability of the business be improved?
More marketing - especially via Search Engine Optimisation (SEO). Flyers handed out in the area offering specials etc generally work very well. An online store for ordering and purchasing by customers together with the aforementioned SEO will make a definite impact on sales. Seller has been wanting to go this route but ill health has not allowed her the time to do so.
What is the total staff complement?
There are 9 x staff members plus the owner.
Give a breakdown of staff/ functions/ length of service?
3 x Shop Assistants; 1 x Cleaner; 4 x Cooks and Preparers and 1 x Manager who cooks, prepares and assists in the shop.
Do any receive special perks or incentives?
At owners discretion. Staff normally get about 50% of normal salary at Christmas.
Are they on contract?
Yes, they all have letters of appointment.
Do any have management potential?
There is already a manager in place who has been in the trade for 17 years.
How involved is the Owner in running the business?
The owner is involved less than 50% of the time in the business but does oversee all operations.
When does the current lease end?
The current lease is on a month-to-month basis but a new lease can be negotiated with the landlord
Is there an option of renewal & what period?
Yes, it is normally renewed for 3 years at a time.
What is the annual escalation %?
The annual escalation is 10% per annum but would need to be negotiated.
What are the trading hours?
Tuesday to Friday: 8.00 am to 5.30 pm. Saturday: 8.00 am to 2.00 pm Sunday: 8.00 am to 12.30 pm Monday - Closed
What is the square meters of the business?
Approximately 80 square meters + 35 square meters seperate for offices and storage plus 2 x garages for storage (all part of the complex).
What lease deposit and/or other surety is required?
Normally 1 x months rental as a deposit or guarentees.
What are the main assets of the business?
Display Fridges, Freezers, Cookers, Microwaves, Generator and all the equipment needed in a kitchen and shop producing food of this calibre.
Are any items not included in the sale?
There is a Hyundai motor vehicle in the business which is not part of the sale.
What is their overall condition?
Good to very good.
Do any require repairing?
None. Maintenace is carried our frequently and when neccessary.
How have they been valued ?
Deemed value by seller.
Which assets are on lease/HP and with whom?
All equipment is fully paid for.
Are they presently insured?
Yes, all comprehensively insured.
This business has operated from the same premises for 25 years. it is an institution and people who live in the neighbourhood support the business. It has an awesome reputation, knowledgeable staff and flexibility over any oppostion who only offer frozen meal alternatives.
Marketing could be better with Facebook and Search Engine Optimisation driving more people from outside the area to the website who will then become customers.
Coffee shop with deck outide would attract more clients to the store. Online purchasing by customers with delivery will be huge convenience for clients.
The economy in general is down but the area that this store operates in tends to be wealthy so there will always be a need for this store and its products. 25 years of operation have proven this to be true - even when times are bad.
What is the reason for the sale?
The owner is not well and needs to take some rest. Other than for this reason she would not consider selling.
Why is this a good business?
History in the area, proven concept - 25 years in the same premises. Knowledgeable staff, excellent reputation, flexibility for customers.
What is the price plus stock and the net profit?
The owner is asking for R2.2 million for the business, including assets of R369 000, plus stock of approximately R50 000. Total asking price: R2.25 million. The Adjusted Net Profit of the business is R968 000 per annum.
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