Fully describe the business's activities?
Hair dressing salon with retail sales of hair products to clients in an affluent area. Curreent turnover around R2m per annum and R550k net profit. Retail sales are limited due to COVID and trend towards on-line buying, There are currently 24 work stations with 5 hairdressers from the business (including the owner) and 5 rented chairs. there are 3 operators (shampoo) for the business and 3 operators working directly with the rented chairs. The business has recently (3 months) moved into a new premises with a much better positioning. The move has seen an uptake of new clients already. The new premises is within 4 km of the previous premises. Owner is very active in the business on a day to day basis. A room is rented out to a threader for R3k per month.
How long has the business been established?
How long has the owner had the business?
How does the business operate on a daily basis?
Clients book for hair appointments and are serviced by the experienced hair stylists. All hair stylists have moved with the business to the new premises
How are the clients attracted to the business?
Clients tend to support their hair stylist. Word of mouth generates new clients, although location can also be critical. The new premises is in a better location with improved visibility, security and covered parking space. the premises has a boom gate and a security guard.
What Advertising/Marketing is carried out?
Word of mouth
What competition exists?
Other hair salons in the area
Is the business VAT Registered?
Are there up-to-date Management Accounts available?
What Balance Sheet and Income Statements are available?
What percentage of the business is cash/credit?
Business is 20% cash, and 80% credit card purchases
How could the profitability of the business be improved?
By moving to a new premises, the owner has already seen an increase in clients.
What is the total staff complement?
8 including the owner.
How involved is the Owner in running the business?
The owner plays an active day to day role in the business
When does the current lease end?
Current lease is for 12 months on an automatic renewal basis
Is there an option of renewal & what period?
What is the annual escalation %?
There will be an 8% increase after 2 years (21 months still to go)
What are the trading hours?
7h30 to 17h30 - 6 days a week
What is the square meters of the business?
Do you require a licence?
What lease deposit and/or other surety is required?
There is a deposit of R40k
What are the main assets of the business?
Stock, TV's, Chairs, Basins, fixtures, mirrors, cupboards etc. List available to serious buyers
What is their overall condition?
How have they been valued ?
Which assets are on lease/HP and with whom?
What are their settlement amounts?
None - all paid for
Are they presently insured?
Business has recently moved into a more affluent and visible premises, which is very upmarket There is a coffee shop in same premises Business situation is close to affluent clientele Ample covered parking with very good security and easy access Has been established for 27 years and has a loyal client base
Current COVID climate has challenges for the business
Attract more clients as the salon has ample work stations for growth
Further lock downs
What is the reason for the sale?
Owner is emigrating in 24 months but if a suitable buyer is found, she is prepared to work for the buyer during this period to assist with the running of the business and the hand over of clients
Why is this a good business?
A well established business set up, with the owner prepared to work for the buyer over an extended period of time. Salon is situated in an affluent suburb and with good visibility and an upmarket feel. The business has proven sustainable profitability over the years
What is the price plus stock and the profit?
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Annual Turnover Amount between R 500 thousand and R 6 million