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MANDATE REPORT
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1. History Background
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Fully describe the business's activities
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Health shop that sells supplemental health products, health foods, diet products and alternative medicines including homeopathic products.
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How long has the business been established?
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2 Years.
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How long has the owner had the business?
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2 Years.
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What steps are in place to solve "load shedding" problems
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None, the business can however easily run on a PC UPS to run the till and card machine.
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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, Passing trade due to the great location of the business in the shopping centre at the entrance to major retailer.
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What Advertising/Marketing is carried out
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None.
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Does the business have any contract work
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No.
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What competition exists
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None.
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What are the seasonal trends
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Peak period is the winter months with the cold supplemental, however in the summer months the diet products are in great demand.
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3. Financial
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Is the business VAT Registered
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No.
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What VAT documentation is on file?
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None.
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Are there up to date management accounts?
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Seller is preparing.
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What audited financials are available, income statement and or balance sheets?
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None.
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What percentage of the business is cash/credit?
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¾ pay by card and ¼ pay cash.
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What is the age analysis of the debtor’s book?
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None.
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How could the profitability of the business be improved?
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Advertising in the Record newspaper. Radio advertising on the local stations such as Jacaranda and Radio Pretoria. Look for exclusive distribution deals on products and potentially become a distribution point for such products.
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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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Only the owner, the new owner can employ somebody in the business, especially if this is a second shop.
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Staff Breakdown and length of service
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N/A
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Do any receive special perks, bonuses or incentives?
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N/A
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Are they on contract?
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N/A
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Do any have management potential?
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N/A
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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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The current lease expires end of August 2013.
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Is there an option of renewal & what period
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Yes, 2 or 3 years.
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What is the annual escalation %?
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10%
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What are the trading hours?
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Mon-Fri 9am-5:30pm, Sat 9am-1pm, Sun is optional
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What is the square meterage of the business?
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15m²
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Is a copy of the lease available?
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Yes
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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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The seller will draw up a full list.
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Are any items not included in the sale?
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No.
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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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No.
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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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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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The business focuses on exclusive products that are not available in the big chains. The businesses position is perfectly situated with lots of feet passing the store.
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Weaknesses
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Not enough marketing.
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Opportunities
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More exposure with marketing and advertising. Bring in extra products such as gym specific products.
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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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The seller is looking to scale back the reasons for which will be explained to a serious buyer.
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9. Conclusion
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Why is this a good business to buy?
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This is a nice profitable business, easy to handle with a great position in the shopping centre and great hours as well.
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