Fully describe the business's activities?
This is a highly profitable franchised retail shop that deals in second-hand goods and also retails new merchandise. Secured loans are also a big portion of their revenue stream. A new owner takes over a well-run business with the necessary processes, systems, and licenses in place. This business has a good cash flow, trained staff in place and is in a great location.
How long has the business been established?
This business was established in 2010.
How does the business operate on a daily basis?
The business is managed daily by a General Manager, the Owner and a full compliment of trained and long standing staff. Their clients are mostly walk-in clients and repeat customers. The manager opens and closes shop.
How are the clients attracted to the business?
The business is situated in a busy retail area and has a broad customer base and a high percentage of repeat business. The Franchise group is a household name with a good reputation that keeps customers coming back. All the advertising for the business is handled by the Franchisor. The shop front and layout of the retail space is also very important for this type of industry.
What Advertising/Marketing is carried out?
The Franchisor manages the marketing and advertising on a national basis and every franchisee contributes 9% of their monthly GP to a marketing fund for the group.
What competition exists?
Exclusivity is guaranteed in the lease agreement and therefore there is no direct competition in the area.
What are the seasonal trends?
Retail peaks over November and December months with pawn brokering and personal loans performing consistently throughout the year. In general the income stream is stable and therefore known as a "recession proof " business.
Is the business VAT Registered?
Yes, this business is VAT registered.
What VAT documentation is on file?
All VAT documentation is available to interested buyers during the due diligence stage.
Are there up-to-date Management Accounts available?
Yes, there are up-to-date management accounts available to interested buyers in the due diligence stage.
What Balance Sheet and Income Statements are available?
The last 5 years of Annual Financial Statements are available to interested buyers in the due diligence stage.
How could the profitability of the business be improved?
The addition of online sales could improve the profitability of sales.
What Royalty fees are payable?
The Franchisee currently pays 11% monthly royalty fees on monthly GP. The joining fees are negotiable to the maximum amount of N$ 45,000.00.
What is the total staff complement?
There are a total of 10 employees.
Give a breakdown of staff/ functions/ length of service?
1 x Manager; 2 x Cashiers; 1 x Buyer; 5 x Sales; 1 x Cleaner
Do any receive special perks or incentives?
All staff receive a basic salary and the sales staff receive a commission payment depending on their targets
Are they on contract?
Yes, all staff are on contracts.
Do any have management potential?
There is already one manager in place.
How involved is the Owner in running the business?
The Franchisor requires that their stores are owner operated. The owner is involved in the overall management of the business and spends 1 day a week at the store.
When does the current lease end?
The lease agreement ends June 2020. The owner is considering moving to new premises with more foot traffic.
Is there an option of renewal & what period?
The current lease agreement is renewable for a period of 3 years, however as the owner is considering moving premises he currently has an agreement for a 3 month notice period.
What are the trading hours?
This business is open 6 days a week from 09h00 to 18h00 Mondays to Fridays and 09h00 to 13h00 weekends.
What is the square meters of the business?
The total area is 460m2.
Is a copy of the lease available?
Yes, a copy of the lease agreement is available to buyers during the due diligence stage.
Do you require a licence?
Yes, licences are required associated with the industry and main business activities. - Second Hand Goods Licence - Certification with Namibian Credit Agreement Act 75 of 1980.
What lease deposit and/or other surety is required?
One months deposit is required.
What is the Franchise agreement requirements regarding shop refurbishment / upgrade ?
The shop front and layout of the retail space is important for this type of industry, therefore the Franchisor requires a shop refurbishment every 5 years. This shop will only need an upgrade between 3 to 4 years time. The owner however is considering moving premises this year and will therefore upgrade the shop when moving.
What are the main assets of the business?
A full list of assets is available to approved buyers.
What is their overall condition?
The assets are in good condition as per Franchisor requirements.
Are they presently insured?
The business has comprehensive insurance.
- Ease of transition for new owner - the business has policies, procedures and excellent staff in place. - Comprehensive training for the new owner. - Excellent location with long term lease available. - Good business model - selling of new and secondhand goods, secured loans. - Strong and well-known brand. - Franchised systems make it easy to manage.
The business can take full advantage of online trading, looking at all products and services.
We could not identify any. This business is very stable.
What is the reason for the sale?
The Owner is preparing for retirement.
Why is this a good business?
Highly profitable, stable business model and system with a proven track record. The business is owner run with a full staff compliment. This is a well known and trusted brand with a good footprint. They have a loyal repeat client base.
What is the price plus stock and the profit?
This business is selling as a going concern, with a clean balance sheet - all liabilities are settled by the seller. Selling at N$ 3,036,000.00 for 100% shares of the business which includes a average monthly stock holding of N$ 760,000.00. It makes a profit of N$ 955,000.00 per annum EBITDA (after all expenses and salaries are paid).