Fully describe the business's activities?
The business is a non - franchised tyre & fitment center that is operated from a spacious premises in the center of a plattelandse town in a vibrant Agri area The business premises has 2 street fronts The business is a multi service center for Tyres / shocks / battery / exhaust / skimming , relining and service of brakes / mag wheels repair & the supply of basic filters , lubricants and vehicle spares
How long has the business been established?
The business was established in 2007 by the seller's late husband
How long has the owner had the business?
The sellers managed the business by herself since XXXXXXXXXXXXXXXXX
How does the business operate on a daily basis?
The manager and / or owner opens the business at 7am The manager and staff is attending to clients and outstanding work The manager at the front counter is dealing with orders and the suppliers The owner is mostly responsible for management and financial functions
How are the clients attracted to the business?
The business is very well located on the center square of the town - very central Close to the school / Post Office / churches / SAPD / many other retail stores It can be coinvent to book your vehicle for repair and do your shopping
What Advertising/Marketing is carried out?
Almost no marketing is carried out The seller is not interacting with the farming community - the biggest potential market
Does the business have any contract work?
What competition exists?
There are other fitment centers in town - they are doing fine since they do marketing , network with the farming community and offer 30 day accounts There are other informal dealers selling tyres who is not complying to the industries' regulations that is is undercutting prices in the informal business segment
How did the Covid-19 pandemic impact the business turnover / daily operations?
The business was able to operate as an essential services provider -
Is the business VAT Registered?
Are there up-to-date Management Accounts available?
The business is using a Point of Sale system ( Unibase )
What Balance Sheet and Income Statements are available?
The new bookkeeper is busy sorting put the backlog
What percentage of the business is cash/credit?
90 % cash sales and only 10 % on credit This was identified as a weak point since many of the bigger Agri clients insist on 30 days terms Allowing credit should be closely managed , and it will require a bigger capital investment ( or better terms negotiated with suppliers )
What is the age analysis of the debtors book?
30 days from statement
How could the profitability of the business be improved?
This business need a capital investment , business initiative and a bid of zest ! The appearance of the building ( although well located ) is dull - rebranding / paint job / sign writing / re-franchising is needed More stock is needed and better terms with suppliers should be negotiated Close networking in the dynamic farming community is needed Credit terms should be offered to clients The space of the building as well as the tools and equipment should be better utilized - For example - basic oil services on vehicles / instalment of audio or tracker systems / resume the mag wheel repair service / stock basic 4x4 upgrade kits and equipment / install lightbars / manufacturing of bakkie rails with the available bending and welding machines
Is Seller finance available and for what amount?
Depending on the buyer
Is the business in good-standing with SARS
The seller has appointed a new financial officer to help clear up the matters with SARS The situation arise since her husband passed away and not all obligations with SARS was followed though With this in mind , the seller will sell the business as a running concern ( selling the assets and establishment ) The seller will sort out outstanding SARS obligations
What is the total staff complement?
The full staff complement is 7 2 are managing counter sales 5 are attending to the cervices and repairs on the 7 lifts and workshop Most of the staff are employed at the business for about 6 years
Do any receive special perks or incentives?
Are they on contract?
Yes If a new owner would like to keep the staff in service - it would be a bonus Otherwise the seller will take responsibility for the retrenchment packages
Do any have management potential?
Yes , the counter manager have good management skills and know the trade and the suppliers
How involved is the Owner in running the business?
The owner is involved in the business by managing the finances from the back-office
Any special arrangements for the staff related to the Covid-19 pandemic?
The staff was fully paid during the lock-down phases
When does the current lease end?
This need to be confirmed , but the landlord is keen to extend a lease
Is there an option of renewal & what period?
What is the annual escalation %?
What are the trading hours?
Weekdays 7H to 17H Saturdays 7h to 13H
What is the square meters of the business?
Is a copy of the lease available?
Yes , the lease is very reasonable and we are sure that a renewal or extension will be possible
Do you require a licence?
The business is registered at MIPCO
Describe the premises
The premises is a 470m2 building located in the CBD of the town There are ample space for the storage of tyres / spares / exhaust parts / workshop area It has 2 street fronts - servicing the clients with tyres and counter sales on the one front , and the workshop area on the other street front The monthly lease is R 12500 Total monthly utilities bill is R 2000
What are the main assets of the business?
Equipment assoisiate to a Tyre and Exhaust fitment center 4 x fourpost lifts 3 x Low level lifts 2 x different pipe bending machines 2 x CO2 welders 1 x Allu Thermamax welder Shimming machine 4 x different compressors 2 x tyre changers 2 x tyre balancers Generator Cutters / Drills / trollies / Presses / Chargers and testers / different jacks and many more Differant types of welders Brake skimming and bonding equipment XXXXXX wheel balancing machines XXXXXX Mag Wheel repair machine and allu welding equipment
What is their overall condition?
The equipment is in a good working condition
Do any require repairing?
How have they been valued ?
The equipment was valued conservatively by the seller - this values was verified by a other fitment center owner
Which assets are on lease/HP and with whom?
All the equipment is paid for
Complete equipped workshop More that enough floorspace Knowledgeable staff Very central and visible location
Business is not in good standing with SARS There are not enough sellable stock in the business The seller does not have the ability to interact with the men in the farming community The overall outward look of the business is dull
With new ideas , capital and a sound business skills it would be easy to grow the business New opportunities to grow the business was mentioned earlier in this report There is the opportunity to grow into one of the well know Franchised brands ( there is non in town )
Informal selling of tyres ( used , retread and gray imports ) Informal fitment centers operating outside of the regulating bodies prescribed regulations Large commercial farmers have they own workshops and start to deal directly with suppliers
What is the reason for the sale?
The seller inherited the business and have no plans to operate in a business segment where she feels uncomfortable in
Why is this a good business?
Priced to sell ( urgent sale ) All equipment in place / low overheads / numerous opportunities to grow the profitability An opportunity to turn the business into a franchised center
What is the price plus stock and the profit?
Selling at R 1 . 4 M This included the stock of about R 650 000 The value of the assets is about R 690 000 The annual turnover is about R 2.6 M
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