Fully describe the business's activities?
Franchised Mediterranean/Pizza restaurant that caters for the family. The business serves gourmet pizzas, traditional Italian pastas, chicken and meat dishes and a a variety of hot beverages. Even split between sit down, take away's and deliveries. 3% Royalty payable. No marketing fee.
How long has the business been established?
The owner bought the outlet in in March 2016 and opened after a revamp in August 2016.
How long has the owner had the business?
Established since 2005.
How does the business operate on a daily basis?
One of the managers opens the business when the preparation for the day starts. There are currently two managers in the business, but it can be run with only one.
How are the clients attracted to the business?
The restaurant is well known in the area it serves. The owner does some menu drops in the surrounding area.
What Advertising/Marketing is carried out?
The franchisor assist with some of the marketing efforts. This is normally done in the form of advertising certain specials to the existing customer base.
Does the business have any contract work?
No contract work.
What competition exists?
Normal competition for this industry.
What are the seasonal trends?
During December, especially during Christmas and over New Year, there's a drop in sales. During a normal day the business serves more customers during lunch and in the evening. Morning trade is not that busy.
How did the Covid-19 pandemic impact the business turnover / daily operations?
Sit downs was affected but take aways really carried the business through
Is the business VAT Registered?
The business is VAT registered.
What Balance Sheet and Income Statements are available?
Annual Financial Statements for the year ending February 2020
What percentage of the business is cash/credit?
No debtors. At least 60% of customers pay with credit or debit cards.
How could the profitability of the business be improved?
Promoting the new breakfast menu will certainly increase sales. Cutting back on two managers will increase net profit with about R16 000p/m
What is the total staff complement?
2 X Managers 4 X Kitchen staff 4 X Waiters 4 X Drivers 5 X Pizza Chefs 1 X Barman 1 X Sculler
Give a breakdown of staff/ functions/ length of service?
The one manager has been with the business for quite some time and assist the owner with almost everything. Another manager who is also more than capable to handle all the day-to-day activities of the business. 5 XPizza-makers and griller with 5 kitchen assistants preparing dishes. 4 X permanent waiters Two drivers that do all the deliveries to customers
Are they on contract?
All staff contracts in place
Do any have management potential?
The owner is satisfied with the performance of the managers
How involved is the Owner in running the business?
The franchisor requires a 100% involvement from the franchisee/owner
When does the current lease end?
The lease agreement ends in August 2021.
Is there an option of renewal & what period?
There's an option to renew for a further 5 years. The franchisor normally assist the owner to secure a lease agreement.
What is the annual escalation %?
Annual escalation of 8%.
What are the trading hours?
The business trades from 07:30am to 10:00pm.
What is the square meters of the business?
Around 160 square meters.
Is a copy of the lease available?
What lease deposit and/or other surety is required?
Three months rental deposit is payable (R150 000)
What are the main assets of the business?
Pizza ovens and grills.
Are any items not included in the sale?
Everything is included in the sale. The Point-of-Sale system is however on a rental contract and the new owner would need to arrange the transfer of the agreement with the service provider.
What is their overall condition?
How have they been valued ?
Which assets are on lease/HP and with whom?
All the assets have been paid for.
Are they presently insured?
All assets are comprehensively insured.
Secure and reliable suppliers. Franchisor training as well as tried and tested franchise operating processes. Proper management and systems in place.
Current owner not 100% involved in business as per franchisor requirements Sit downs can be increased and delivery radius expanded
More deliveries. More owner involvement and marketing.
None were identified.
What is the reason for the sale?
The owner is involved in other businesses and the franchisor requires stronger commitment to the outlet.
Why is this a good business?
Excellent location in busy center with no direct competition. Established for more than 10 years and part of a franchise group. Exceptional food . Solid cash flow.
What is the price plus stock and the profit?
Selling Price of R1 400 000 plus stock of R80 000 and excluding the Franchise Joining Fee of R100 000.
The prospective buyer will need to pay R100 000 joining fee to the franchisor and also needs to complete the franchisor training. The landlord also requires a deposit.
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