DVD Shop In Fourways For Sale

Business description

History Background
Fully describe the business's activities?
A well known video franchise shop renting videos and DVD's to the public. Various packages available.
How long has the business been established?
The business was started in 1995
How long has the owner had the business?
The present owner has been with the business for the past 7 years.
What steps are in place to solve "load shedding" problems?
4 self charging lights are used.
Present Market
How does the business operate on a daily basis?
The shop has a prominent location in a shopping centre hosting large outlets.
How are the clients attracted to the business?
Being in the area for so long it is well know to the public.
What Advertising/Marketing is carried out?
Leaflets are distributed in the suburb and the Franchisor advertises at Ster Kinekor & Metro theatres.
Does the business have any contract work?
Contract are in place with various customers.
What competition exists?
None in the area.
What are the seasonal trends?
Sales are higher during school holidays.
Financial
Is the business VAT Registered?
Yes, business is vat registered
Are there up-to-date Management Accounts available?
Management accounts are available to serious buyers.
What Balance Sheet and Income Statements are available?
Financials for past two years are available
What percentage of of the business is cash/credit?
60% of business is cash
How could the profitability of the business be improved?
Owner run and more advertising will increase sales
Staffing
What is the total staff complement?
1 Manager and 4 casuals
Give a breakdown of staff/functions/length of service?
The manager has been there for 1 year but the casuals change regularly.
Do any receive special perks or incentives?
Profit sharing if target is reached.
Are they on contract?
no staff contracts exist
How involved is the Owner in running the business?
5% - accounts & orders
Premises
When does the current lease end?
in 3 years
Is there an option of renewal & what period?
Option to renew available
What is the annual escalation %?
10%
What are the trading hours?
10h00 - 20h00 daily
What is the square meterage of the business?
100m
Is a copy of the lease available?
yes, copy of the lease is available
Do you require a licence?
no licence required
Assets
Is a full asset list on file?
A full asset list is available. Stock is valued at R277 500
Are any items not included in the sale?
All items are included
What is their overall condition?
Very good condition
How have they been valued. ?
Market value
Which assets are on lease/HP and with whom?
Everything is paid up
Are they presently insured?
Shop is insured.
S.W.O.T. Analysis
Strengths?
Singular outlet in suburb - closest competitor is 6km away.
Weaknesses?
Demographics change in suburb
Opportunities?
growth
Threats?
recession
Reason For Sale
What is the reason for the sale?
Relocating to west coast
Conclusion
Why is this a good business?
Has entire suburb as market and a 13 000 loyal customer base.
What is the price plus stock and the net profit?
Selling price is R825 000, including stock of R277 500. Average net profit is R16 000 per month.

Other information

Furniture / Fixtures value:

R100,000 (included in the asking price)

Inventory / Stock value:

R272,000 (included in the asking price)