MANDATE REPORT

1. History Background

Fully describe the business's activities

This home based business is in the wholesale supply and distribution of mainly cold meats at this point in time, the intention is however to expand into other products for the existing customer base of the business and the business is perfectly positioned for this.

The business has a 10 Spar’s on the books and another 3 large clients on the books. In addition they have already seen another 18 Spar’s that need to be followed up on. In total there are 80 Spar’s in Pretoria apart from all the other supermarkets, etc.

How long has the business been established?

5 Years

How long has the owner had the business?

2.5 Years

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

N/A

2. Present Market

How does the business operate on  a daily basis

Owner run

How are the clients attracted to the business

Word of mouth and marketing.

What Advertising/Marketing is carried out

Currently a temp rep is used to look after the existing stores, however this should be done by the owner or a full time rep.

Does the business have any contract work

No contracts, it’s all about the client relationships.

What competition exists

Nobody else supplies the brand in these areas and the supplier is in Boksburg and stock is collected once a week.

What are the seasonal trends

Closed during the last week of December and first week of January as supplier is also closed.

Winter is quitter and peak season is over the summer months.

3. Financial

Is the business VAT Registered

Yes

What VAT documentation is on file?

Not up to date

Are there up to date management accounts?

Not up to date

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

Not available

What percentage of the business is cash/credit?

All COD apart from 3 that pay via EFT within a week

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

N/A

How could the profitability of the business be improved?

Add more clients and products to the product mix, the business is already in at the Spar’s

Is Seller finance available and for what amount?

No

4. Staffing

What is the total staff complement?

1 Driver and a temp Rep

Staff Breakdown and length of service

1 x Driver

1 x Temp Rep

Do any receive special perks, bonuses or incentives?

No

Are they on contract?

No

Do any have management potential?

No

How involved  is the Owner in running the business

100%

5. Premises

When does the current lease end?

Run from home

Is there an option of renewal & what period

N/A

What is the annual escalation %?

N/A

What are the trading hours?

Mon-Fri 8am-5pm

What is the square meterage of the business?

N/A

Is a copy of the lease available?

N/A

Do you require a licence?

No

6. Assets

Is a full asset list on file?

Assets consist of

1 x Chana 2007 1300 Star – R30,000

4 x Defy 600l Fridge/Freezer – R25,000

1 x Small scale – R1,000

1 x Laptop – R2,500

1 x Printer – R1,500

1 x Website

Are any items not included in the sale?

Only the items listed

What is their overall condition?

Good

Do any require repairing?

Ongong repairs are done

How have they been valued?

Owner valuation

Which assets are on lease/HP and with whom?

Chana – Seller will settle

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

Well established with a great client base

Weaknesses

Not enough marketing and sales to grow the client base.

Opportunities

Expand the client base with all the other Spars as well as the other supermarkets and Butcheries

Expand into energy drinks such as Dragon, Energade, etc.

Threats

None identified

8. Reason For Sale

What is the reason for the sale?

Owners health

9. Conclusion

Why is this a good business to buy?

Well established with an excellent client base and the opportunity to grow this much bigger.