Sale could take Chipmunks Hamilton to next level

Chipmunks, in north Te Rapa, has a 1100sq m premises featuring a three-storey playland and cafe.

The owners of Chipmunks Hamilton - a seven-days-a-week childcare operation catering for children aged 0-11 years and incorporating a cafe business- have decided to put it on the market.

ABC business broker Greg Dunn says this opens up an opportunity to own Hamilton's premier franchised indoor children's adventure playground and cafe.

"This business is the market leader in providing a safe and comfortable environment for the little ones, and a relaxed atmosphere where parents and guardians can relax," says Dunn.

"It's an excellent business, run on a simple business model and backed by a global franchise that's active New Zealand-wide. Above all, it is achieving strong sales growth and shows huge potential for further growth."

The business is showing a very good return on investment to a working owner. "The brand is celebrating 20 years in New Zealand and is growing in leaps and bounds. With the support of a top class franchise system this business is ready for the next owner to build on the excellent growth shown year-on-year.

"The systems and processes are all in place, with quality safe and secure kids play areas, underpinned by a health and safety system that is second to none, making this an exciting industry to be part of."

Dunn says the business - at 8B Maui St, in north Te Rapa - shows what can be achieved with focus, entrepreneurship and an ability to think outside the square.

"Kylie and Mark Owen have put their heart and soul into making this business stand out from the rest.

"The 1100sq m premises are purpose-built, featuring a three-storey playland and cafe and a solid long term lease is in place."

"Kylie also currently caters to a small group of children for after-school care under the Out of School Care and Recreation (OSCAR) approved Ministry of Social Development programme," says Dunn.

"This is an untapped revenue stream for a new owner with significant room for increasing participants under this model."

He says there is a super-sized main playground structure, comprising themed play areas for toddlers (plane and train rides) supported by a well-trained group of dedicated employees, which makes it an easy business to own and operate.

The store is fully managed, Kylie works across the business and fills in when required.

"A buyer could work in the business full-time if they wished or leave the two managers in there as well as utilising the 12 to 14 part-time staff."

Dunn believes that if a new owner is prepared to work hard and deliver customer service they are likely to make a good return on their investment.

Potential opportunities

• Increase the OSCAR program participants.

• Grow the already successful school holiday program

• Take advantage of the new after-hours packages

• Newly revitalised birthday packages for ages 0-to-11 years

• New cafe menu ready to roll out in store.

• Increase revenue through the Chipmunks brand loyalty programme.

• Kohanga Reo, kindergartens, mothers groups, day-care and so forth could be accommodated in future.

• Marketing to large businesses which employs parents.

• Local schools could endorse the before and after-school care offerings

• Boost awareness of drop-off service and after hour functions

This business operates a full cafe and barista service.

"Kylie and her team provide a quality menu for their clients, catering for the little ones' birthday parties, right through to a fabulous flat white or beverage of your choice for the adults," says Dunn.

"They aim to deliver an amazing playground and birthday experience that families love. The present menu is comprehensive and a new menu roll-out is waiting a new owner.

There is a total of 16 staff, a mixture of full and part-time.

"Kylie employs two full time staff but one of these positions would not be required should a new owner take over the business. These two full timers manage the business on a day-to-day basis, they are responsible for leading the part time staff, managing the clients and ensuring everyone is having a fantastic time in a safe and secure environment. They are also responsible for running the cafe.

Most of the part-time staff are high school or university students, who have been with Mark and Kylie for many years.

They are called on to assist in the busy times (school holidays, weekends), and are all fully trained in the requirements of this very busy franchised business.

Lease details:

• The 15-year lease commenced on October 5, 2012.

• There are two five-year rights of renewal, with rent reviews scheduled for July 2027 and July 2032.

Key attributes of the business:

• Walk in to an extremely well run and profitable business.

• Scope to increase revenue with plenty of opportunities for growth to a hardworking and dedicated owner.

• Would suit a couple who can run and manage the business on a day-to-day basis and reduce the wage cost even further.

• Clean and tidy with equipment that is in particularly good condition.

• Comprehensive health and safety record.

• Industrial kitchen and cooking facilities.

• Plenty of parking and easily located in the heart of north Te Rapa, Hamilton.

At a glance:

Tangible Assets: $246,000
Intangible Assets: $257,000
Total Price: $503,000
Plus stock (about $6000)