MANDATE REPORT
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1. History Background
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Fully describe the business's activities
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This is a traditional dry cleaner with laundry that offers washing, drying and ironing. The business also does alterations and tailoring for it’s clients.
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How long has the business been established?
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18 years
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How long has the owner had the business?
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Current owner has the business 6 years
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2. Present Market
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How does the business operate on a daily basis
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The business is owner run, one of the staff members opens in the morning at 7am with the owner coming in around 9am, the owner closes at night
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How are the clients attracted to the business
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Word of mouth mainly
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What Advertising/Marketing is carried out
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The shopping centre has marketing days to attract clients to the centre. They have also distributed pamphlets in the past but other than that there is no real marketing or advertising being done.
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Does the business have any contract work
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The business is contracted to cleaning the overalls of the local supermarket as well as for another organisation in the area. Then there are three depots that make use of the Dry Cleaner with collections from two of them.
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What competition exists
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Closest competition is at least 6km away.
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What are the seasonal trends
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Winter is peak season for the business and then again December and January.
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3. Financial
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Is the business VAT Registered
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No
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What VAT documentation is on file?
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N/A
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Are there up to date management accounts?
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Yes up to Feb 2014 and busy with current year
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What audited financials are available, income statement and or balance sheets?
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Yes, 2012 with seller, 2013 at the accountant who is also busy with the 2014 financials.
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What percentage of the business is cash/credit?
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95% Cash and 5% EFT
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What is the age analysis of the debtor’s book?
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None
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How could the profitability of the business be improved?
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More marketing, canvas business in the area such as Guest houses, restaurants, businesses for business clothes such as overalls, etc.
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Is Seller finance available and for what amount?
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No
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4. Staffing
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What is the total staff complement?
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7 staff members.
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Staff Breakdown and length of service
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3 x Iron staff
2 x Dry Cleaning staff
1 x Tailoring and alterations
1 x Washing and front of house, also opens
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Do any receive special perks, bonuses or incentives?
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One gets 10% commission on alterations and tailoring
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Are they on contract?
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No
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Do any have management potential?
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Yes two of the staff members do
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How involved is the Owner in running the business
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The owner is daily in the business from 9am onwards till closing
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5. Premises
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When does the current lease end?
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August 2014, busy with negotiations for a renewal of the lease
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Is there an option of renewal & what period
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Yes for 5 years
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What is the annual escalation %?
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10%
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What are the trading hours?
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Mon-Thu 7am – 6:30pm
Fri 7am – 6pm
Sat 8am – 2pm
Sun Closed
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What is the square meterage of the business?
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±98m²
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Is a copy of the lease available?
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Yes
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Do you require a licence?
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No
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6. Assets
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Is a full asset list on file?
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Yes, seller is adding values to current asset list
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Are any items not included in the sale?
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Embroidering machine
Industrial sowing machine- seam binder
In kitchen, 2 cabinets with 2 drawers each
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What is their overall condition?
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Good condition
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Do any require repairing?
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Ongoing repairs and maintenance is performed
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How have they been valued?
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Owner valuation
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Which assets are on lease/HP and with whom?
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N / A
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What are their settlement amounts?
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N / A
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Will Seller settle or Buyer to take over?
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N / A
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Are copies of agreements available?
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N / A
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Are they presently insured?
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Yes
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![]() ![]() 7. S.W.O.T. Analysis
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Strengths
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Well established and very well managed.
The centre is getting busier and the area surrounding is a growing area.
Centre puts on regular special days to attract clients
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Weaknesses
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No real weaknesses identified
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Opportunities
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Business is running at around 80% capacity before new staff or equipment will need to be added.
There is the potential for a KFC coming to the complex
Then there is also 5,000 post boxes coming to the centre right by the shop.
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Threats
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None identified
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8. Reason For Sale
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What is the reason for the sale?
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The seller is relocating to the cape
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9. Conclusion
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Why is this a good business to buy?
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Profitable, well run and managed business with scope for growth, seller only selling because they are relocating to the Cape.
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