MANDATE REPORT
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1. History Background
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Construction Activities
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Please note that there is construction activity on the road running past the Filling Station for three months, this is having a effect on the Turnover and Litres for the duration as clients have to use a detour road, the seller however was prepared for this eventuality.
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Fully describe the business's activities
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Privately owned filing station including convenience store, Take Away, ATM, Gas and Car wash.
There are historical figures going back much further than the four months shown, the reason for only showing the four months is that that is when RAS kicked in which made a substantial change to the profitability of the station and is the measure going forward. Qualified buyers will be supplied with a spreadsheet showing the last 12 months, all information has supporting documentation.
The property is also be available to interested buyers, however this is a 5 Hectare land with 2,500m² business rights zoning in place of which ±250m² is already developed. The seller has plans to bring in a Bottlestore and Butchery to compliment the Filling Station and attract more business. Price will discussed during meetings between the parties.
The shop turns over an average of R362,000
Electricity and Airtime sales of approx. R80,000 to R90,000 per month at ±4%. Prepaid ±R3,000 per day. Included in shop turnover.
Product Litres Nozzles
LRP 46,000 6
ULP93 61,000 8
ULP95 15,000 2
Diesel 500ppm 61,000 10
There is an extra 46,000 Diesel storage available.
Budget on stock as follows
Fuel 120,000 litres @ Avg R12.96 = R1,500,000
Shop R220,000
The ATM generates an average R15,800 a month extra income.
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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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5 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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Owner run hands on
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How are the clients attracted to the business
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The filling station attracts passing trade. Word of mouth for the good service and the ATM is an added attraction that draws a lot of clients.
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What Advertising/Marketing is carried out
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None, however the Diesel price is a good attraction
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Does the business have any contract work
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About 20 accounts with prepaid petrol
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What competition exists
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No other filling station son the same road.
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What are the seasonal trends
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January , February, March and April are the quieter months after which it picks up from May through to November. Petrol stays constant and diesel is with the contractors.
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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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All Vat returns
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Are there up to date management accounts?
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Yes
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What audited financials are available, income statement and or balance sheets?
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2012, 2013 and currently busy with 2014
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What percentage of the business is cash/credit?
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Cash 35%
Card 25%
Account 40%
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What is the age analysis of the debtor’s book?
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No accounts, only small stuff ±R70,000 per week and ±R60,000 per month.
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How could the profitability of the business be improved?
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Attract more clients with specials on Diesel prices.
Add Diesel 50ppm which is already in the process.
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Is Seller finance available and for what amount?
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Some assistance may be considered.
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4. Staffing
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What is the total staff complement?
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19 Staff members
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Staff Breakdown and length of service
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1 x Office/Manager
1 x Shop supervisor also cashiers
5 x Cashiers (Always 2 on duty, 1 floating to where required)
1 x Supervisor & Petrol forecourt
9 x Forecourt/Petrol
1 x Chef
1 x Cleaning
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Do any receive special perks, bonuses or incentives?
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MIPCO Rules
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Are they on contract?
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All staff members are
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Do any have management potential?
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Yes, already in place
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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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Owned by the seller. A rent of R70,000pm is INCLUDED in the fixed expenses.
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Is there an option of renewal & what period
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To be negotiated
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What is the annual escalation %?
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To be negotiated
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What are the trading hours?
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24x7
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What is the square meterage of the business?
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220m² Building
100m² Shop
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Is a copy of the lease available?
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Will be drawn up
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Do you require a licence?
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Yes, DME Site and Retail
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6. Assets
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Is a full asset list on file?
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Seller will draw up
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Are any items not included in the sale?
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Basic personal stuff
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What is their overall condition?
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Very good
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Do any require repairing?
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2 Air conditioners have been disconnected as they have installed two new 60,000 BTU units
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How have they been valued?
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Seller valuation
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Which assets are on lease/HP and with whom?
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None
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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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Is a private station so no BEE requirements
Well established,
Great service and convenience
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Weaknesses
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None identified
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Opportunities
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Add 50ppm Diesel
Run Diesel specials
Landlord will put in extra business around the station which will draw more clients
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Threats
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Normal to a filling station
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8. Reason For Sale
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What is the reason for the sale?
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It’s time for the next step in the sellers life
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9. Conclusion
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Why is this a good business to buy?
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Great well established business with no BEE requirements as the Seller owns the land and all the equipment.
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