Fully describe the business's activities?
Manufacturers and distributors of natural/organic skin care products and health products.
How long has the business been established?
How long has the owner had the business?
10 years but was in family previously.
How does the business operate on a daily basis?
The business comprises a small focused team each with their own responsibilities. All aspects of the business are handled from the same premises which makes the business an ideal home based industry. The business has its own showroom and also is represented at a local market.
How are the clients attracted to the business?
There is a long established customer base nationally of health stores and the website has also attracted export orders.
What Advertising/Marketing is carried out?
Website and marketing through the existing distribution network. The business premises are high profile which assists with brand awareness and sales within their immediate surrounds.
What competition exists?
There are numerous products within this sector each with its own specific brand following.
What are the seasonal trends?
The product type and distribution outlets are not affected by seasonality.
Is the business VAT Registered?
What VAT documentation is on file?
All Vat returns are on file as and when required.
Are there up-to-date Management Accounts available?
What percentage of the business is cash/credit?
Many of the retail stores have a 30 day account facility, and a number pay upfront by EFT. Showroom sales are paid by cash or credit card.
How could the profitability of the business be improved?
The business is at the stage where it may well benefit by incremental marketing and possibly a representative calling on the 180+ stockists.
What is the total staff complement?
There are 4 staff inclusive of the Owner.
Give a breakdown of staff/ functions/ length of service?
Apart from the owner who handles all the General Management responsibilities there is a Supervisor in place who is supported by two General Assistant workers. The Supervisor/Assistant has been employed for 5+ years and is capable of addressing all of the aspects of the Owners job function if required. He is supported by 2 female staff members who decant and label the finished goods and make up the orders and prepare for distribution. The one lady has over 12 years service and the other 2 years.
Are they on contract?
Normal conditions of employment.
Do any have management potential?
The male Supervisor is at a strong level of management and can be further developed if necessary.
How involved is the Owner in running the business?
On a daily basis in all aspects of the business.
When does the current lease end?
The Owner also owns the premises at which the business is situated. These premises are available for purchase by the Buyer, or the Seller may consider a lease at market related rentals with right of first refusal to purchase.
Is there an option of renewal & what period?
Subject to negotiation.
What is the annual escalation %?
Negotiable as per lease agreement if agreed.
What are the trading hours?
Monday to Thursday: 08-00am to 4-00pm Fridays: 08-00 to 3-00pm
What is the square meters of the business?
The business is housed in a 4 bedroom home situated on a stand of approximately 800 square meters. The kitchen is currently being upgraded to a laboratory at a cost of R120K.
Who is the Owner/Landlord?
The business Owner.
Is a copy of the lease available?
No lease currently in place.
What are the main assets of the business?
Fixtures, fittings and equipment. There are no vehicles included in this transaction.
Are any items not included in the sale?
Yes the vehicles.
What is their overall condition?
Do any require repairing?
The kitchen is in the process of being upgraded to serve as a laboratory.
How have they been valued ?
The property is valued at R1.9 Million
Are they presently insured?
The current product range need just be maintained to ensure business viability. The business is long established and has good financials and a positive cash flow. There is opportunity for further growth within certain products within the range.
The business is by its nature very competitive so the Buyer needs to be au-fait with this market sector and understand the need for quality product production and customer service levels.
There is a need and an opportunity to introduce a range of products that are specifically aimed at the Black skin care market, and will offer a new growth stream. More progressive marketing and possible appointment of a representative/brand ambassador.
There are no threats outside of the normal trading conditions that exist.
What is the reason for the sale?
The Owner has decided that she would like to relinquish the business and may consider emigration in the future. All manufacturing of the skin, hair and body range is done by the Owner who will teach / train the new Owner on all aspects of the formulation of the product range so that the brand maintains continuity. The Owner is prepared to ensure a substantial hand over period and would consider assisting the Buyer going forward on the sales and distribution side of the business by agreement.
Why is this a good business?
To prove that this is a good business one just needs to track the historical performance of the business and the product quality, route to market and popularity that has been built up over many years of hard work and outstanding and consistent service levels. A new Buyer need just maintain the business as per its current trading conditions to ensure that the profitability is maintained, but there are a lot of initiates that can be implemented to facilitate incremental growth.
What is the price plus stock and the net profit?
The average profit during the last financial year is in the region of R80,000 per month. The stock on hand fluctuates dependent upon orders in pipeline and purchase of packaging materials; so more concise information will be given to the interested part at time of business negotiation. The business exclusive of stock is priced at R3.6 Million.
The Seller has instructed that no business name or location be disclosed unless the interested party has supplied an up to date Non-Disclosure Document and proof of funds.
Annual Turnover Amount between R 500 thousand and R 6 million