|
MANDATE REPORT
|
|
1. History Background
|
|
Fully describe the business's activities
|
Welding and fabrication engineering business
|
|
How long has the business been established?
|
3 Years
|
|
How long has the owner had the business?
|
The owner started the business
|
|
2. Present Market
|
|
How does the business operate on a daily basis
|
Owner run
|
|
How are the clients attracted to the business
|
The business has a great website that attracts multiple enquiries per day.
|
|
What Advertising/Marketing is carried out
|
Direct sales with the sales manager doing cold calls.
|
|
Does the business have any contract work
|
Only jobbing type contracts.
|
|
What competition exists
|
Various other business as is normal in this industry.
|
|
What are the seasonal trends
|
December is the quietest with the business closing from the 29th Dec to the 13th January.
|
|
3. Financial
|
|
Is the business VAT Registered
|
No
|
|
What VAT documentation is on file?
|
N/A
|
|
Are there up to date management accounts?
|
Yes – Seller is drawing up
|
|
What audited financials are available, income statement and or balance sheets?
|
Seller will prepare
|
|
What percentage of the business is cash/credit?
|
95% EFT and 5% Cash (Business operates on a 50% deposit and balance on delivery)
|
|
What is the age analysis of the debtor’s book?
|
None
|
|
How could the profitability of the business be improved?
|
Sales and proper follow through on quotes issued by the business.
|
|
Is Seller finance available and for what amount?
|
Seller will consider a minimum down payment of R175,000 to the right buyer
|
|
4. Staffing
|
|
What is the total staff complement?
|
4 staff members.
|
|
Staff Breakdown and length of service
|
1 x Sales Manager
3 x Welders/Fabricators
1 x Assistant (Temp)
|
|
Do any receive special perks, bonuses or incentives?
|
No
|
|
Are they on contract?
|
Only the salesman and one welder have a signed contract
|
|
Do any have management potential?
|
Yes the salesman
|
|
How involved is the Owner in running the business
|
100%
|
|
5. Premises
|
|
When does the current lease end?
|
October 2014
|
|
Is there an option of renewal & what period
|
Yes, 1 year
|
|
What is the annual escalation %?
|
Seller to confirm
|
|
What are the trading hours?
|
Mon-Fri 8am to 4:30pm
|
|
What is the square meterage of the business?
|
600m²
|
|
Is a copy of the lease available?
|
Yes
|
|
Do you require a licence?
|
No
|
|
6. Assets
|
|
Is a full asset list on file?
|
Yes, seller will also update to encompass all the assets
|
|
Are any items not included in the sale?
|
Owners laptop
|
|
What is their overall condition?
|
Good condition
|
|
Do any require repairing?
|
On going maintenance is performed
|
|
How have they been valued?
|
Owner valuation
|
|
Which assets are on lease/HP and with whom?
|
N / A
|
|
What are their settlement amounts?
|
N / A
|
|
Will Seller settle or Buyer to take over?
|
N / A
|
|
Are copies of agreements available?
|
N / A
|
|
Are they presently insured?
|
No
|
|
7. S.W.O.T. Analysis
|
|
Strengths
|
Website with the no of enquiries that it generates.
Skills of the staff
Position is in a prime site in a major industrial area
|
|
Weaknesses
|
Seller motivation
|
|
Opportunities
|
Various industries have been left untapped.
Proper follow up on enquiries to the website
The amount of repair and maintenance jobs available in the market.
|
|
Threats
|
Economy, but that will also bring more maintenance work.
|
|
8. Reason For Sale
|
|
What is the reason for the sale?
|
The seller wants to join his wife in her business.
|
|
9. Conclusion
|
|
Why is this a good business to buy?
|
Nice well established business with a variety of jobs on the horizon, sales and technical skills are all in place.
|