MANDATE REPORT

1. History Background

Fully describe the business's activities

This car wash business was started in January 2013.  The car wash is growing every month and has a good low rental contract.  There are in a good position and with good marketing this carwash can show a good income.   This business is located in the middle of a lot of business.  There is a restaurant, nursery, hardware store and of course the cars wash on site.  It is near a busy road and near known mall and car dealers.  A Porsche car dealer ship is planned for the future on site. The restaurant draws a lot of clients to the site. There is a coffee shop that caters for clients while waiting for their cars to be washed. Site has amble parking. 

How long has the business been established?

3 months in the current premises.

How long has the owner had the business?

3 months ago.

What steps are in place to solve "load shedding" problems

There is no backup generator on premises.

2. Present Market

How does the business operate on  a daily basis

Owner currently manages the car wash.

How are the clients attracted to the business

Word of mouth, and are known in the area for 3 months.

What Advertising/Marketing is carried out

No marketing is done. No web sites.  There is good potential in good local store marketing stratify. 

Does the business have any contract work

Yes two contracts were recently set up with clients.

What competition exists

There is only one author car wash in the area.

What are the seasonal trends

The business is still new and are not known but owner says that the author 8 businesses on site say that January and February are quieter months with good pick up from March

3. Financial

Is the business VAT Registered

No

What VAT documentation is on file?

N0

Are there up to date management accounts?

Can be supplied on demand

What audited financials are available, income statement and or balance sheets?

On request

What percentage of the business is cash/credit?

All cash.

What is the age analysis of the debtor’s book?

A cash business.

How could the profitability of the business be improved?

More local store marketing. There are car dealer ships and a lot of offices in the area.

Is Seller finance available and for what amount?

No.

4. Staffing

What is the total staff complement?

3 staff members.

Staff Breakdown and length of service

3 car wash Staff members.

Do any receive special perks, bonuses or incentives?

Yes R100.00 per week.

Are they on contract?

 They are currently finalising the contracts.

Do any have management potential?

How involved  is the Owner in running the business

Owner spends all his time on site because it’s a new business.

5. Premises

When does the current lease end?

The current lease will end over 2014.

Is there an option of renewal & what period

Yes there is a option for renewal

What is the annual escalation %?

10 %

What are the trading hours?

Mondays to Sundays from 8h00 up to 17h00

What is the square meter age of the business?

90m²

Is a copy of the lease available?

Yes on request

Do you require a licence?

Just a Business licence

6. Assets

Is a full asset list on file?

Yes on request.

Are any items not included in the sale?

None sold as is

What is their overall condition?

Excellent

Do any require repairing?

No

How have they been valued?

No

Which assets are on lease/HP and with whom?

None

What are their settlement amounts?

No

Will Seller settle or Buyer to take over?

N0

Are copies of agreements available?

n/a

Are they presently insured?

Yes

7. S.W.O.T. Analysis

Strengths

The car wash is brand new. IT is still in a growth phase and there is a lot of potential. Rent is low.

Weaknesses

Not enough marketing. With a good local store marketing plan, can this store show good growth?

Opportunities

There are a lot of well known businesses in the area. The excess road is very busy road. The site in an up market community. Expansion of the business is an opportunity to grow its client base. The coffee shop can be developing to a more themed base operation.

Threats

There is only one other car wash in the area. It is situated in a filling station

8. Reason For Sale

What is the reason for the sale?

The owner has other business opportunities.

9. Conclusion

Why is this good business to buy?

It is in a good location with a lot of potential. If the new owner do more local marketing and broker more deals with all supermarkets in the area, will this store make the owner a good income.