Fully describe the business's activities?
The business specialises in Spitbraai's and Catering for functions of any kind such as birthdays, team building, private and business functions, from 1 to 1000 plus people if required. Currently they cater in the Western Cape from Plettenberg Bay to the Peninsula as required All different dietary requirements are catered for, including vegetarian and Halaal meals.
How long has the business been established?
This current one is around 3 years old, but the Seller has owned and sold two other such businesses in the past.
How long has the owner had the business?
How does the business operate on a daily basis?
The Owner and his wife handle all of the administrative and management functions, marketing etc, and are supported by a team of Chefs and Drivers who are on a casual basis and are only paid after completion of each function.
How are the clients attracted to the business?
The business has an excellent website that has attracted over 10,000 followers resulting in ongoing work despite the current Covid situation. Strong "Word of mouth" endorsement due to the high service levels that the Seller demands of his team, and resulting in many endorsements and referrals. A follow up is done after every event, to ensure that the clients were satisfied with the food, service levels and staff professionalism.
What Advertising/Marketing is carried out?
Facebook is almost the only medium apart from business cards being handed out.
Does the business have any contract work?
No contract work but they do get repeat work from satisfied clients, and they have certain corporate clients where they are the favoured supplier, amongst them being Woolworths and many sports clubs.
What competition exists?
There are many other such businesses, but not many of them can boast the endorsement levels and referrals as well as the many "Likes" that they receive from Face Book. Many "Bakkie Brigade" type operators spring up but don't last long.
What are the seasonal trends?
Busy throughout the year but peaks over the summer holiday period.
How did the Covid-19 pandemic impact the business turnover / daily operations?
The Owner ensures that all of his staff are aware of the required Covid protocols and precautions. For this reason they liaise with the function holder first with regards to the use and supply of crockery and cutlery.
Is the business VAT Registered?
What VAT documentation is on file?
What Balance Sheet and Income Statements are available?
The viability of this business can be established through looking at the EFT deposits into the business bank accounts, the invoice and related costs of each event, and also the balance of the payments which are made into the bank account at least 72 hours prior to the function taking place. This together with the related costs per function prove the viability of the business.
What percentage of the business is cash/credit?
Strictly EFT payments with a deposit of 50% and balance paid 72 hours prior to the event. No cash or credit cards are handled at all.
What is the age analysis of the debtors book?
How could the profitability of the business be improved?
There are significant additions that can be made to the product offering such as potjies, fish braai's, chop braais, kiddies parties etc that could be offered on the food side. A new Owner may like to offer flowers & decor plus DJ's etc which could be arranged for the functions and often get requested, but the Owner prefers to focus on the Spitbraai and Catering as it currently is.
What is the total staff complement?
No permanent staff are employed. Currently apart from the Owners they have: 3 Chefs 2 Drivers
Give a breakdown of staff/ functions/ length of service?
3 Chefs 2 Drivers The chefs are able attend local functions alone if they can drive and have time. All equipment is loaded and staff are trained so that the staff member can operate alone at the function given the correct time availability. However if there are multiple functions in the same period and proximity a driver may be allocated to assist.
Do any receive special perks or incentives?
The staff are trained that they may not partake in any activities at the function such as consuming alcohol etc, but they are permitted to accept tips, gifts etc.
Are they on contract?
No all staff are temps
How involved is the Owner in running the business?
The Owners attend to all the administrative functions such as quotations, ordering of the food, preparation of deserts and salads etc. They also attend to all General Management requirements of the business. All equipment and foods etc are checked out meticulously by the Owners before when the chef leaves. The staff have a well trained method of operating, such as cleaning on site once the meal is served, and repacking the vehicle etc. The Owners check everything when the operator gets back.
What is the square meters of the business?
The business requires little more that secure parking for the two vehicles and a storage facility such as a double garage for all of the equipment.
Do you require a licence?
No, but all Halaal meat is given a supporting certificate by the butcher which is sent to the customer before the start of the function to ensure that all the required protocols have been adhered to.
What are the main assets of the business?
2 Vehicles - - 1 Nissan NP 200 Year 2020 1.6L - 1 Chevrolet Utility 2016 1.8L 6 Stainless Steel Spitbraai's Gas bottles, trestle tables etc Full range of equipment as required. A manual turning handle accompanies each function in case of load shedding. An important part of this business is the intellect within the meat cooking process and basting which is a trade secret in formulation and will only be shared once the sale is complete...it is a well tried and well liked recipe.
What is their overall condition?
All equipment is well maintained, cleaned and checked after every function and is part of the professional image that the business depicts at the function. This image is important to repeat work and endorsements and referalls.
How have they been valued ?
The Owners second hand value.
Which assets are on lease/HP and with whom?
One vehicle has outstanding payments but this will be paid in full and transferred at time of purchase.
What are their settlement amounts?
Current Owner to settle
Will Seller settle or Buyer to take over?
Will be settled in full and reregistered onto Buyers name at time of sale
Are they presently insured?
This business can be run from home so overheads are low. The business can operate from virtually anywhere which is a strong advantage allowing the Owner to live wherever they like. The business has around R500,000 currently in reserve for functions where a deposit has been paid but must still be held. Since all functions are paid 50% upfront to secure a booking and balance of 50% at least 72 hours prior, the business enjoys a strong cash flow and no bad debts are incurred. Staff are temps so no other staff costs are incurred.
Relying on temp staff can sometimes be a problem. The distances travelled although under current circumstances are not an issue, However if and when the Covid situation changes, it may be prudent to open a second operation closer to the main market.
Potjie's, chop or fish braai's can be introduced. Catering offering can be significantly increased if so desired Flowers, Decor & DJ's could be arranged as well. The opportunity exists to increase the footprint by selling of rights to the trading name and territories.
None at present as business well run, well supported and not impacted by significant opposition.
What is the reason for the sale?
This is the third such business that the Owners have operated and both the previous two have been successfully sold off in Gauteng and Natal. The Owners are finding it reasonably easy to manage and have lots of free time to the extent that they need new challenge. They have a young family at school and are looking to possible emigrate in the near future.
Why is this a good business?
This is an excellent business for a well structured and meticulous couple who pride themselves on giving excellent service. There are not many such businesses where you receive 50% up front and full payment prior to incurring any expenses. However the success lays in the delivery of fine food, a clean and professional image, happy customers offering referrals and endorsements and a well maintained Face Book page. The business has no premises to lease, no permanent staff members or high overheads. Can be managed by a well focused and hard working married couple or an individual.
What is the price plus stock and the profit?
The asset base is around R500,000 currently, and stock is low as purchases are made prior to the function. The average profit over a 12 month financial year period is around R65K+ per month prior to any owners drawings.
Annual Turnover Amount between R 500 thousand and R 6 million