Fully describe the business's activities?
Business can be best described as a full service plumbing operation operative in the larger Johannesburg Metropolis.
How long has the business been established?
The owner started the business in 2008
How does the business operate on a daily basis?
Insurance claims are received via an online system operated by the insurance companies. Existing clients and Body corporates either call the dedicated office line or send email requests. All jobs are scheduled through a dedicated job management portal that takes care of the job process from start to invoice. The owner has general oversight of daily operations, Bank movements, payment authorisations and takes care of quality control.
How are the clients attracted to the business?
The business has a neat website that allows anybody searching for plumbing services to interact with the business directly. A complete customer focused CRM database has been built up ensuring repeat business. Steady and continuous work for insurers via their claims administration process.
What Advertising/Marketing is carried out?
The owner spends some money on Google Adword campaigns as well as small amounts on body corporate websites.
Does the business have any contract work?
1. Stable income is generated from the insurance claims for which the business is registered as a service provider. This work typically covers the East Rand, North and Central, as well as South Johannesburg 2. Company is also on the contractor's panel for many property management companies 3. Company is also an agent on behalf of major suppliers (Kwikot, Calafrica, etc)
What competition exists?
There are many smaller plumbing operators in Johannesburg. Lots of competition in the private market, but little competition in the insurance sector.
What are the seasonal trends?
The winter months tends to be busier.
Is the business VAT Registered?
The business is VAT registered.
What VAT documentation is on file?
All VAT documentation is completed via SARS E-Filing system
Are there up-to-date Management Accounts available?
Management Accounts will be readily available to any prospective buyer
What Balance Sheet and Income Statements are available?
Latest Balance Sheet and Income Statement is for the period ending February 2019
What is the age analysis of the debtors book?
Insurance work is paid for weekly. Debtors >90 days are <1% of total receivables
How could the profitability of the business be improved?
A secure option is to apply to other insurance companies and appoint extra teams. There is also room for improvement on the supply side and obtaining better prices for parts and goods - can save a lot.
Is Seller finance available and for what amount?
Seller will only consider this with an 80% up front payment
What is the total staff complement?
26 staff members
Give a breakdown of staff/ functions/ length of service?
Of the two owners only one is involved full time, taking care of all things financial and the day to day management. 4 x Office bound staff consisting of Head of Operations, Accounts Clerk & General Admin and 2x Job Administrators 9 x Teams consisting of Team Leader and a Plumber 1 x Stock controller 1 x Electrical guy - subcontracted (not qualified but supported by a qualified electrician) 4 x Additional Teams - subcontracted (not full-time employees)
Do any receive special perks or incentives?
The operational teams consist of a plumber and an assistant. Only perk is a discretionary 13th cheque paid annually The two owners/shareholders take a lot of perks out of the business
Are they on contract?
Yes contracts are in place for all permanent staff
Do any have management potential?
The owner is very happy with his Head of Operations who takes care of all oversight of the plumbing teams.
How involved is the Owner in running the business?
One owner is overseas and not involved. Co-owner is actively involved in the business. working 3 days a week in office and 2 days from home.
Information on the lease agreement
The owner opted for a month to month lease agreement in anticipation of the planned sale of the business. In total 160 sq/m and a monthly rental of R14 000 (Incl VAT)
What are the main assets of the business?
9 x vehicles for the plumbing teams Tools and equipment for all teams including leak detection/drain machines 5 x computers, 1 x Server and networking infrastructure Office furniture inclusive of coffee machine, fridges filing cabinets, desks and chairs Office cell phones - total of 11 Containers for storage of stock
Are any items not included in the sale?
All assets are included in the transaction
What is their overall condition?
Very good - many items brand new.
Do any require repairing?
There is no repairs needed. All the equipment is in perfect working order
How have they been valued ?
The owner assisted us with the cost value for each of the items.
Which assets are on lease/HP and with whom?
6 x vehicles remain on HP
Are they presently insured?
All fixed assets are comprehensively insured.
The most impressive of this business is the in-house/online system that takes care of all the processes, documentation and the like for the daily operations of the business. It makes the management of the business very easy. Information is immediately available and each of the plumbing teams follows a well defined and disciplined process to complete a job.
The owner is in Australia After the sale, the company needs a qualified plumber as the owner or general manager to sign off on COC's (3 x internal employees can do this with small qualification)
Large scope for growth in other insurance companies. Employing/appointing more teams is a definite possibility Selling plumbing supplies and equipment on retail may also boost revenue.
Only the general status of the South African economy.
What is the reason for the sale?
The owner is emigrating to Australia
Why is this a good business?
The ease of management and complete business management software solution make this a beaut of a business. Daily activities in the business can be viewed and managed remotely.
What is the price plus stock and the profit?
Asking price of R11 000 000 includes stock of R850 000 - 900 000 Option to enter into a long term lease agreement or relocate
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