Acquisition Value
R3,800,000: Business Value (Selling Price)
R3,000,000: Stock (Estimated)
R6,8 Million: Total Acquisition Value (Including Stock)
Profitability
R2,261,000 Million: Net Profit (EBITDA) per Annum
R 188,416 Net Profit (EBITDA) per Month
Investment Returns (Including Stock)
3 x: PE Ratio (Price Earnings Ratio, Before Tax)
33%: ROI (Return on Investment, Including Stock)
36 x: MPB (Months’ Pay Back)
BACKGROUND HISTORY
The business was established more than 61 years ago in Johannesburg, and relocated over 30 years ago to the current business premises. The current owner and his spouse plan to retire abroad after many successful years in the business, they are more than willing to assist a prospective buyer for a transition period.
The clothing product ranges are considered a necessity and the business currently supplies essential clothing to a very solid established market that has been built up over many years. Online sales for a part of the product range are a very successful and a relatively new initiative for the distribution and sales of well-known brand names. It is considered something for the future and the business therefore strives to keep up with innovation in the market and expanded services to customers.
The focus on customer care and good service, combined with value for money in a clean and safe environment, differentiates the business with distinction. Stock quantities are analyzed, compiled and planned, based on three years of historical sales per product. The business also supplies stock directly to the market from suppliers, located on a national basis across South Africa. Supplementary orders are placed at factories and suppliers that hold stock throughout the year in smaller quantities as required.
Most of the cliental are in the immediate and surrounding suburbs of the business, although orders are delivered to clients as far as Johannesburg. The operational and financial functions in the business are managed by the existing owner and his spouse. There are currently three employees, two of whom have more than ten years’ experience, they work together as a team. The staff have basic employment contracts and do not belong to a union. The statutory registrations for staff are all in place and are paid monthly to the various government institutions according to legislation. The reliable point of sale systems and financial system are very efficient when it comes to reporting and control in the business and is most probably one of the best operating systems in the industry.
A comprehensive financial overview was carried out over the financial system, latest Annual Financial Statements and Management Accounts. The relevant source documents were confirmed against operational expenditure. The proposed price valuation was calculated against industry benchmarks and considering that the business has a good historical growth trend and successfully well-established over so many years.
IMPORTANT NOTE
There are certain terms and conditions and requirements in terms of our agreement with the seller under which we are restricted to introduce a potential purchaser/investor, no detailed operational/financial information will be disclosed without the required documentary and source documents being processed according to the seller's criteria.
