Fully describe the business's activities?
A franchise nail and body shop is for sale in a busy shopping centre. The shopping centre has a lot of foot traffic daily. This business will suit, but is not necessarily restricted to, a qualified beautician as owner. This franchise has a head office with approximately 53 franchises operating nationally. 60% of the business is hands, feet and nails and the other 40% is body â massages, waxing, facials. This particular franchise, unique to itself, has a loyalty card system in place and has a big client base currently. The loyalty system is incentive based and can only be redeemed at this store. They have a fantastic POS system designed for this business that keeps track of all clients and staff activity. There is a comprehensive array of lotions, creams, etc for sale from 3 primary houses. They are, Environ (SA) for all races, Dermalogica (USA) and Guinot (French) exclusive to this store. The buyer of this business must be vetted by the Franchisor who will come down to interview the prospective buyer.
How long has the business been established?
The business has been established for 14 years
How long has the owner had the business?
The owner has the business for 18 months
How does the business operate on a daily basis?
This business has a very good loyalty card programme and is well positioned in the shopping centre.
The gift cards are redeemable at various sister salons.
They also have a gift card service which holds value for up to 36 months. They do send bulk sms and email to all their clients regarding specials etc.
How are the clients attracted to the business?
Clients are attracted via social media, sms and pamphlets
Head office franchsor has a reward program for clients
What competition exists?
Nearest competition is more than 5km away
What are the seasonal trends?
The sales tend to be lower during the winter months
Are there up-to-date Management Accounts available?
Yes, management statements available on request
What Balance Sheet and Income Statements are available?
Yes, statements are available on request
What percentage of the business is cash/credit?
10% cash
90% cards
How could the profitability of the business be improved?
Initiate specials deals and specials packages for students (Varsity area)
Is Seller finance available and for what amount?
No
What is the total staff complement?
A total of 6 staff members
Give a breakdown of staff/ functions/ length of service?
5 x permanent staff members
1 x Temp (2 days per week)
Do any receive special perks or incentives?
The staff members earn a basic salary + commission
Are they on contract?
Yes
Do any have management potential?
Yes, 1 manager appointed
How involved is the Owner in running the business?
The owner is +- 20% involved in the business
When does the current lease end?
There is currently 1.5 years left on the lease agreement.
Is there an option of renewal & what period?
Yes renewal option is availible
What is the annual escalation %?
The annual escalation is 6%
What are the trading hours?
Mondays to Saturdays 09:00 - 18:00
Sundays 09:00 - 13:00
What is the square meters of the business?
69 square meters
Is a copy of the lease available?
Yes a copy of the lease agreement is available on request
What lease deposit and/or other surety is required?
Yes, 1 months lease deposit is required
What are the main assets of the business?
The main assets of the business is the well established clientele (Good will)
What is their overall condition?
All is in a good working order
Do any require repairing?
No repairs are needed
How have they been valued ?
Purchase price valuation
Strengths?
Well established and well known name franchise - Top performers in their group
The only beauty shop in the shopping centre. Very little competition
Carry exclusive products no one in the centre can sell - Good loyalty programme
Qualified staff
Lots of walk -in clients
Opportunities?
Expansion of the business will improve sales
Special offers / deals for students
Threats?
Owner Managed - shouldn't leave the business completely to a manager
What is the reason for the sale?
Because the owner has a full time job, availability is limited
Divided attention
Why is this a good business?
This franchise is a well established brand and is located in a highly profitable location
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Annual Turnover Amount between R 500 thousand and R 6 million