Sectors / Category

Annual turnover

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  • Mandate: 34875
  • Added: 16 Sep 2021
  • AFS
  • 522

Well known, long established & profitable guesthouse in Hartbeespoort

Gauteng, Other
522
Mandate 34875
Added 16 Sep 2021
R 8,500,000* ZAR
Stock: R 0
Assets: R 3,202,324
R 35,650 ZAR
Ian Tennant
(PRINCIPAL)
Aldes Egoli
North West
North West
Summary

This 9 room, profitable guesthouse is situated in Hartbeespoort, one of the 5 top domestic short-term holiday destinations in South Africa. It boasts a 100% occupancy record for weekends and 77% occupancy overall. It has a liquor licence, a spa and a unique beach holiday vibe which are very popular amongst guests.

SELLING PRICE AFS
R 8,500,000* ZAR
Stock: R0
Assets: R3,202,324
R 35,650 ZAR
Summary

This 9 room, profitable guesthouse is situated in Hartbeespoort, one of the 5 top domestic short-term holiday destinations in South Africa. It boasts a 100% occupancy record for weekends and 77% occupancy overall. It has a liquor licence, a spa and a unique beach holiday vibe which are very popular amongst guests.

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Fully describe the business's activities?
Club Cocomo Guesthouse, a 9 bedroom guesthouse, is one of the most well known and popular guesthouses in the Hartbeespoort surrounds. It is a vibrant, healthy business with an existing established market & differentiates itself from competitors through its positioning and product offerings. The town of Hartbeespoort is one of the country’s fastest growing tourism areas in the county, known as the gateway and hidden jewel of the Northwest, play park for Gauteng and is rated as one of the top 30 most popular tourist destinations. After Cape Town, it is one of five most visited short term domestic leisure tourist destinations in South Africa. This is a great investment opportunity: Club Cocomo enjoys a prodigious market share of short term bookings. Being one of the best rated establishments ran by a dynamic group of individuals in a rapid developing town is a recipe for success with a promising future. Club Cocomo is a healthy business and generates good returns with an occupancy rate of 77%. Club Cocomo has a strong online presence and is also listed on the central supplier database of government (CSD) as well as on the database of major travel agencies, corporate companies and major municipalities. It has an attractive website and mobisite domain and features on social media forums too. Its primary line of business comprises: - 9 luxury accommodation suites - An on-site Spa - Conference & Corporate Centre - Tiki Cocktail Bar - Beach Cafe Restaurant - Shell & gift shop

How long has the business been established?
2005

How long has the owner had the business?
2005

How does the business operate on a daily basis?
7am to 9pm official trading hours. Reception from 8am to 16:30 weekdays, 9am – 12 noon weekends. There is, however, always someone on site to assist clients.

How are the clients attracted to the business?
A 4-Star gem in Hartbeespoort. It offers a unique island ambiance, tropical vibe & tranquility. Well-established gusethouse since 2005 with a solid reputation, that has been in existence and built up over years It is listed listed on numerous travel ad accommodation websites and social media forums. It has a huge existing database of loyal clientele Unique theme and ambiance exporting right through the entire business It offers a variety of services and offerings to guests that are conveniently available on site It is an ideal location, situated jclose to the main road, (allowing a peaceful and tranquil environment) in a residential area versus major competitors that are located on the main road (traffic & noise pollution)

What Advertising/Marketing is carried out?
Marketing focuses on the following primary audience / target market - Romantic couples (often celebrating a special occasion) - Corporate travelers - Local market who enjoy the spa, Tiki Bar and Beach Cafe - Local companies as a venue for meetings, brainstorming sessions, presentations and team building - The main target markets for both leisure and corporate are domestic clients, especially from the Gauteng area. There is an opportunity to market internationally too. Numerous marketing tools are utilised, including: - Direct selling to targeted audiences - Word-of-mouth is hugely important and great emphasis is placed on the client's experience at the guesthouse - Use of technology through internet marketing and apps (this is the main marketing tool) - Use of social media - Presence on all local tourism information centre's marketing communications - Networking with the local network of tourism and wedding venues to promoting the guesthouse exclusively - Bulk e-mail advertising to a database of close to 100 000 e-mail addresses and followers - Listed on the CSD of Government vendor’s and tender’s databases

What competition exists?
There are numerous other B&B's and guesthouses in the area. The major competitors are located on the main road and attract, mainly, the impulsive visitor as they suffer from traffic and noise pollution. Club Cocomo is situated just off the main road, but in a peaceful and tranquil environment in a residential area. There’s are no other competitor catering exclusively for the elite executive market Club Cocomo targets

What are the seasonal trends?
Club Cocomo is a niche, boutique guestf\house that targets 2 main markets: - romantic couples that is a short-term leisure travel that favours the warmer temperature of summer months. This romantic couple market is predominantly a weekend traveler too. - the corporate market for the business traveler that is predominantly a "during the week guest. This niche market tends to be less sensitive to seasonal trends.

How did the Covid-19 pandemic impact the business turnover / daily operations?
Covid19 had a negative impact on the tourism sector as is widely known. However, being a well-known establishment with a long history and close to the metros of Johannesburg and Pretoria, business recovery was relatively quick. Visitors escaped the metros after the lockdown periods to relax and get back to normality. Club Cocomo also received some financial assistance through the Department of Tourism and SEFA SMME enterprise initiatives.

What steps / actions have been taken to combat the effect of Covid-19 pandemic?
A COVID-19 management strategy plan is in place that is currently in line with the regulations published under the National Disaster Management Act. Club Cocoma has also implemented the guidelines issued by the Tourism Industry in terms of specific protocols & procedures for Covid-19 as set out by the TBCSA.

Is the business VAT Registered?
Yes

What VAT documentation is on file?
Registration and VAT returns

Are there up-to-date Management Accounts available?
Yes

What Balance Sheet and Income Statements are available?
Yes

What percentage of the business is cash/credit?
No credit sales

How could the profitability of the business be improved?
Weekend occupancy is normally 100% There is scope to improve "during the week" occupancy rates through focusing on the international tourist and corporate client.

Is Seller finance available and for what amount?
No

What is the total staff complement?
10 (8 females and 2 men, 8 African and 2 White, mostly all below 35 years of age)

Do any receive special perks or incentives?
Salaries and client tips only

Are they on contract?
Yes

Do any have management potential?
Yes

How involved is the Owner in running the business?
Very involved

What is the square meters of the business?
960 sqm

Do you require a licence?
Yes, municipal zoning for a guesthouse, liquor licence and health certificate

Property Ownership
The property is owned independently by the owner of the guesthouse. The property is being sold with the business and is included in the price.

What are the main assets of the business?
Property Bedroom furniture and equipment (TVs) Office furniture and equipment Dining room furniture Bar equipment and furniture Kitchen equipment Boardroom furniture Spa equipment and furniture Shop equipment and furniture Outside furniture Heated pool equipment Solar Borehole

Are any items not included in the sale?
No

What is their overall condition?
Good

Do any require repairing?
No

Which assets are on lease/HP and with whom?
Bond over property

Will Seller settle or Buyer to take over?
Seller will settle

Are they presently insured?
Yes

Strengths?
- It is a well established guesthouse which has buit a solid reputation and client base since 2005. - It has an effective online presence on numerous tourism websites, apps, OTA platforms & social media forums. - It has a large existing database of loyal clientele - It s a 4-Star graded guesthouse since 2005 - It has a unique theme and ambiance that flows through the entire business - A variety of services and offerings to guests are offered - It is a peaceful and tranquil environment located in a quiet residential area versus the maincompetitors who are located on the main road

Weaknesses?
- Limited land on th eproperty inhibits growth in terms of additional accommodation - It is Not being entirely disabled friendly

Opportunities?
- There are opportunities to expand by purchasing and developing bordering properties - Additional tourism services could be added e.g. car hire, provision of tours etc. - BEE buyers potentially have the opportunity to benefit from specific government BEEE grants and funding programmes. - Target the international guest - Focus on mid- week market opportunities

Threats?
- Continuation of Covid lockdowns - Rapid growth of the area will attract additional competitors - The poor infrastructure of the area and lack of quality local municipality services

What is the reason for the sale?
The owners have a young family and are intending to emigrate to join family overseas

Why is this a good business?
- Club Cocomo is a profitable, market leader gusethouse in Hartbeespoort. - The town of Hartbeespoort is one of the country’s fastest growing tourism areas and is one of five of the most visited short-term domestic leisure tourist destinations in South Africa. - Hartbeespoort area offers an abundance of world-class tourist attractions which contributes greatly to the high percentage of travellers to the area

What is the price plus stock and the profit?
R8,500,000 which includes all the property, fixed assets and guesthouse equipment and soft goods (i.e blankets, towels etc.).

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AGENCY DETAILS

Aldes Egoli

1 members
14 mandates
North West
42 Bass Cove The Coves Estate Hartbeespoort 0216

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