MANDATE REPORT
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1. History Background
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Fully describe the business's activities
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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.
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How long has the business been established?
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5 Years
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How long has the owner had the business?
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2.5 Years
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What steps are in place to solve "load shedding" problems
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N/A
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2. Present Market
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How does the business operate on a daily basis
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Owner run
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How are the clients attracted to the business
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Word of mouth and marketing.
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What Advertising/Marketing is carried out
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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.
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Does the business have any contract work
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No contracts, it’s all about the client relationships.
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What competition exists
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Nobody else supplies the brand in these areas and the supplier is in Boksburg and stock is collected once a week.
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What are the seasonal trends
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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.
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3. Financial
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Is the business VAT Registered
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Yes
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What VAT documentation is on file?
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Not up to date
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Are there up to date management accounts?
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Not up to date
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What audited financials are available, income statement and or balance sheets?
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Not available
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What percentage of the business is cash/credit?
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All COD apart from 3 that pay via EFT within a week
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What is the age analysis of the debtor’s book?
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N/A
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How could the profitability of the business be improved?
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Add more clients and products to the product mix, the business is already in at the Spar’s
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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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1 Driver and a temp Rep
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Staff Breakdown and length of service
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1 x Driver
1 x Temp Rep
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Do any receive special perks, bonuses or incentives?
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No
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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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No
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How involved is the Owner in running the business
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100%
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5. Premises
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When does the current lease end?
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Run from home
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Is there an option of renewal & what period
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N/A
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What is the annual escalation %?
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N/A
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What are the trading hours?
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Mon-Fri 8am-5pm
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What is the square meterage of the business?
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N/A
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Is a copy of the lease available?
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N/A
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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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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
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Are any items not included in the sale?
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Only the items listed
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What is their overall condition?
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Good
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Do any require repairing?
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Ongong repairs are done
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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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Chana – Seller will settle
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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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No
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7. S.W.O.T. Analysis
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Strengths
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Well established with a great client base
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Weaknesses
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Not enough marketing and sales to grow the client base.
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Opportunities
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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.
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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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Owners health
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9. Conclusion
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Why is this a good business to buy?
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Well established with an excellent client base and the opportunity to grow this much bigger.
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