Table of Contents Executive Summary

The growths of the international students are significantly increased every year in Malaysia which brings much business opportunity associated with Malaysia’s education industry. Mr… Bernard, the owner of Became is contemplating a sale of the canteen at BBC University at ARM 500,000 as he plans to migrate to Australia. The canteen operated for 1 5 years which serves breakfast and lunch at reasonable prices for 10,000 students nowadays. Moreover, there is no other competitor within KM which shows a great competitive advantage.

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It looks likely a good/worth deal on the surface but no one can assure that. Therefore, the business overview of Became, the canteen in BBC University will be evaluated in this business valuation report. Moreover, asset valuation, market valuation and income-based business valuation will be covered in the financial analysis part in this report to further examine the real value of Became. Opinion of Value Based on the review of the information provided, I’m of the opinion a reasonable range of value for Became, as of 31 January 2012: ARM 400,000 to ARM 500,000 The most valuable selling price

ARM 400,000 The reasonable selling price ARM 450,000 The maximum selling price ARM 500,000 Offered Price Among the three techniques applied, income-based business valuation (ROI method) has been chosen as the best approach to estimate the selling price of Became as ROI is able to predict the periods required to get back the return on investment. As the findings from ROI method at ARM 400,000 is not far from the offered price at ARM 500,000 thus the buyer can consider this deal seriously.

Moreover, research in education industry analysis in this report showed huge potential of growth in Malaysia’s education industry as the numbers of international students are increasing every year which directly impact the canteen business in University. Therefore, the business has broad future market opportunities which also supported by the findings with market valuation method. It estimates the selling price of comparable business which is ARM 479,166. 67 for Became business. Therefore, it is worth to take it as the value of Became proved to be close to the offered price.

For my recommendations, the business is able to achieve higher net profit simply by reduce the canteen’s turnover rate which is increasing every year. Moreover, huge intake of international students in recent years give alerts that the current foods and drinks menu have to be improved significantly to satisfy the international students as well as the local students. Therefore, huge potential are clearly showed although there are some issues in Became. However, my opinion of value is subjected to the assumption and limited conditions.

Assumptions and Limiting Conditions 1) This report has been copyrighted by XX Valuation Sad Bad. And possession of this report, or a copy thereof, does not carry with it the right of publication of all or any art, nor may it be used for any purpose without the prior express written consent of XX Valuation Sad Bad, and in any event only with the proper authorization; 2) The report assumes the canteen personnel remain existing working conditions which they have verbal commitment to me; 3) All the information, estimates and opinions contained in this report obtained from reliable sources.

However, I have not independently verified such information and, so, assume no liability for such sources; 4) All the facts and data contained in this report are the best of our knowledge and life, true and accurate. I have not intentionally concealed or omitted from the report, which may affect my perspective, conclusions, recommendations, or estimate; 5) The estimates presented in this report are only applicable to this analysis and may not be used of the context presented herein. ) The report assumes that there were no regulations of government entity that controlled or restrict the use of underlying assets, unless specifically mentioned; 7) The report includes the prospective financial information, estimation or opinion is represents my view about reasonable expectation. All the information, estimates or opinions have not considered as predications or assurances that certain level of income or profits will be achieved or specific events will happen; 8) I assume that there are no hidden or unexpected business conditions that would conclusions expressed in the report.

Business Overview History of Company Mr… Bernard has been operating his own canteen named Became in BBC University since 1997. With 15 years of experiences, the canteen is able to serves breakfast and lunch at reasonable prices for students and staffs in BBC University. In 1997, Mr… Bernard invested ARM 60,000 to start this business and hired 3 staffs to serves around 1 ,OHO students and staffs. As the number of international students dramatically increases since 2006, Mr… Bernard has hired up to 10 staffs to cope with the rising demands.

With the increased numbers of staffs, Mr… Bernard decided to not only prepares ready cook foods but also “fresh” cook foods. According to Paranoia Antitank & Swastikas Chatterer (2012), college canteens are no longer the choice of students as it always with minimal furniture. The cafes and coffee shops are the latest hangouts for dents and they don’t mind spending more money for the luxury such as air- conditioned, comfy seating and environment.

Thus, Mr… Bernard decided to invest heavily in equipment, furniture and tools in 2007 to attract more students to eat in canteen and ease the process of food preparation. Other than changing and improve the environment in canteen, Mr… Bernard also add on new variety of freshly cook/ made foods and drinks such as riot canal, special fried rice/noodles and fruit Juices to give more variety of choices for students. Last but not least, the working hours of Became are Mono-Fri… (7 a. M. To 3 p. . ) and Sat (7 a. M. To 1 p. M. ). Besides that, S. W. O.

T analysis has used to analyze the internal environment of Became. Strength Low employee turnover rate Equipment, furniture and tools in good condition Able to provide foods and drinks at reasonable price Debt-free Good hygiene High number of customers Weaknesses Increasing turnover every year Limited variety of foods and drinks Slow in service due to lack of staffs Opportunities No competitors within KM from BBC University Increasing number of students every year Threats Growing of high-end cafeГ© and restaurants outside KM from BBC University No.

Foods and Drinks Sandwiches (Egg Mayo and Tuna) 2 Burger (Chicken and Beef) 3 Fried Rice (Camping, Chinese, Thai) 4 Fried Noodles/Magi/Bind 5 Mixed Rice 6 NASA Lemma 7 Breads 8 Riot (Canal, Teller, Banana, Plant, Boom, Sardinia) 9 Noodles Soup (Tom Yam, Curry, Assam Lakes, Normal) 10 Soup (Tom Yam, Curry, Normal – Chicken/Beef) 11 Chicken Chop (Mushroom/Black Pepper) 12 Fresh Juices (Carrot, Orange, Apple, Mango, Watermelon) 13 Beverages (Mill, Kopi, The, Barley) 14 Can/Bottle Drinks (100 plus, Coca Cola, 7-up, Root Beer, Mountain Dew, Tropical Twister, Mineral Water) 15

Fruits The services of canteen have improved since the dramatic increases of international students since 6 years ago to provide more variety of choices. The menu consists some of the Malaysian delights such as Curry MME, NASA Lemma, Riot Canal and also Western food such as chicken chop. To ensure the quality of the services, all of the as above, students can enjoy freshly cook/made foods and drinks simply by order from the cashier then a queue number will be given for food collection later.

The queue numbers are displayed on few TV screens in the canteen. Moreover, students ho prefer time-saving can Just queue up and take foods and drinks from the ready cook/made food stalls then precede to the cashier for payment. Education industry analysis and its impact on canteen business Malaysia is world’s 1 lath largest exporter of educational services with over 90,000 international student private education institutions enrolment rate in 2011 (Ottawa, 2013).

From figure 1, it shows the enrolments of international students which have increased from 26,569 in 2000 to 91,670 in 2011. This situation is one of the main factors which lead to dramatic increase of international students in BBC University. Figure : Enrolment of International Students in Higher Learning Institutions in Malaysia Sources from: http://www. Google. Com. My/emigres? Urn-I CLC CHEMO malleability:&imgrefurl=http://www. faceable. Com/ environmentalism’s=81HcyMkAsCZUbM=http://sphotos- a. Xx. FQDN. Et/hoops-sash/ Figure : Local and International Students of BBC University Year Local Student International Student Total 1997 700 300 1 oho 2000 1200 1700 2003 1 500 2100 2006 2009 3000 3500 6500 2012 10000 Table : The total numbers of local and international students of BBC University Based n figure 2 and table 1, increases of international and local students showed and reached to 10,000 students in 2012 which the local students holds 40% while the international student holds 60% of total students in BBC University.

For further analysis, 90% of international students are from some of Europe countries such as United Kingdom, France, Ireland, Astrakhan and Russia while the 10% left are from United States, Iraq and others. As we can see by now, the canteen needs to be more diversified in service provided to fulfill the students from different background. With he increased numbers of students, the BBC University canteen appeared to be a good business opportunity.

Thus, the impact to the canteen is huge especially when the numbers of international dents is more than local students in BBC University. For example, the services provided in canteen are focus on Malaysian Delights which may only satisfy the local student’s choices but not the international students which lead them to spend outside the University. Although university education in Malaysia expenses are expensive to Malaysian, but various options are available such as scholarships and study loans from the Public Service Department POP), The STAR Education Fund, Sin Chew Education Fund and more.

Since 1st July 1997, the National Higher Education Fund Corporation (PPTP) was established with the mission to manage funds for the purpose of higher education to achieve the objective of no student should be denied access to higher education due to financial reasons (PPTP, n. D. ). Therefore, local students are able to access to higher education with the financial support not only from companies but also the Ministry of Higher Education (MOE) 2013. It meaner that the numbers of local students in BBC University are expected to increase every year.

From the analysis above, the opportunity of canteen business is clearly seen as the attention customers are already there. However, the changes of university lifestyle in Malaysia could be another threat on the canteen business. Nowadays, the university students are willing to pay more for their meals in cafes and restaurants outside the University which are popular and comfort in environment (Paranoia Antitank & Swastikas Chatterer, 2012). (I) Ready-cook foods Step Process Description Plan Discuss what foods and how much need to prepare.

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