"Selling your business is our business"
"Selling your business is our business"
Fully describe the business's activities?
This well situated Early Learning Centre, in East London, is registered to care for children from babies (2 months) to Grade R (6-year-olds). They currently have 103 pupils while being registered for 137 pupils.
Children are taught to love learning as they absorb large amounts of information during the first few years of their life. Parents and visitors are impressed with the high standard of education.
The Pre-Primary classes are involved in school readiness programmes including literacy, numeracy, life skills and basic computer skills.
Three playgrounds ensure that each group of children mix with peers of their own age.
The children are exposed to outings, displays, extra-mural activities and special l days of celebration every term.
How long has the business been established?
This was one of the first non-racial pre-schools in the Eastern Cape.
It was established in the early 1970âs.
How long has the owner had the business?
Since 1999 - 26 years
How does the business operate on a daily basis?
They are open from 7 am to 5pm. Monday to Friday. The children follow a daily programme of well-prepared, interesting & integrated lessons until 12 pm, they have 2 intervals (am & pm) for snacks, eat a hot, cooked lunch & pudding, rest/sleep from 12:30 -2 pm, are monitored & observed on the 3 different playgrounds
How are the clients attracted to the business?
By word of mouth, passing the premises, visual advertisements, website & facebook.
What Advertising/Marketing is carried out?
5 Digital advertising boards, facebook, website and WhatsApp as well as word of mouth.
Does the business have any contract work?
No
What competition exists?
Small start-up businesses nearby and in the city, many of which are unlicensed, do not have qualified teachers and thus offer low fees
What are the seasonal trends?
None, except we close our doors over the December holidays for 3 weeks.
Is the business VAT Registered?
No - any Educational institution is VAT exempt.
Are there up-to-date Management Accounts available?
Yes - Up until end February 2025
What Balance Sheet and Income Statements are available?
As at End February 2025
What percentage of the business is cash/credit?
Very little - about 10%. Customers generally pay via EFT or credit cards
What is the age analysis of the debtors book?
2 months
How could the profitability of the business be improved?
By taking on more pupils.
Reducing staff & salaries.
Is Seller finance available and for what amount?
No
What is the total staff complement?
20
Give a breakdown of staff/ functions/ length of service?
Teachers, assistants, cook, cleaners, gardener, manager, bursar, principal & directors.
Record of service available.
Do any receive special perks or incentives?
Yes, time off over school holidays, half days every week and all public holidays, days off when required.
Are they on contract?
All permanently employed
Do any have management potential?
Yes
There is already a management team in place.
How involved is the Owner in running the business?
The owners live in Cape Town but are in daily contact with the school management team, tend to all payments and manage maintenance requirements. They are able to watch/monitor teachers remotely on 36 cameras as often as necessary.
They fly to the business on a fairly regular basis.
When does the current lease end?
The owners own the building which is in a trust
The owners are offering the building for sale at a selling pricce of R 2 550 000 which will be a separate sale agreement.
The lease agreement will contain a provision that the new owner of the school will have the right of first refusal to buy the building.
Is there an option of renewal & what period?
There is a lease in place between the Trust and the (Pty) Ltd.
New owners will be able to negotiate a new lease with the Trust, which is the current owner..
What is the annual escalation %?
To be negotiated
What are the trading hours?
07h00 to 17h00 Monday to Friday
What is the square meters of the business?
1200 sq metres
Is a copy of the lease available?
Yes
Do you require a licence?
A licence is in place against the current legal entity.
What lease deposit and/or other surety is required?
1 months rental
What are the main assets of the business?
A full asset list is available
Are any items not included in the sale?
A few percussion pieces are not included.
What is their overall condition?
Overall very good
Do any require repairing?
Constant maintenance has been maintained on playground equipment and small items or toys.
How have they been valued ?
At fair market value
Are they presently insured?
Yes
Strengths?
Good reputation, qualified and committed teachers, loyal staff, close to parentsâ work places, regular reports & parent meetings
Opportunities?
Open After Care centre,
Offer holiday/weekend care.
Threats?
Too many small unlicenced pre-schools have popped up since Covid,
Economic climate.
What is the reason for the sale?
Both the owners are at retirement age..
Why is this a good business?
Going concern, constant income every month, no extra assets need to be purchased.
A full management team in place.
Very well known and has an excellent reputation.
Extra notes
They have built up an extremely good reputation over the last 26 years and maintain a high standard of education and care.
They would like the school to maintain the same values.
The sale must be treated confidential as the owners would not want any parent to have an idea that they are considering selling the business.
The building in which the school is housed may also be leased with a provision that when they want to sell, the new owners would have the right of first refusal.
