Sectors / Category

Annual turnover

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  • Mandate: 33917
  • Added: 30 Jun 2020
  • AFS
  • 413

Ice-cream cone manufacturer with strong market position.

Gauteng, Centurion
413
Mandate 33917
Added 30 Jun 2020
R 16,000,000* ZAR
Stock: R 2,500,000
Assets: R 10,000,000
R 342,422 ZAR
Peter Kind
(PRINCIPAL)
Aldes Platinum
Gauteng, Midrand
Gauteng, Midrand
Summary

Well established Ice-cream cone and wafer manufacturer with strong market position.

SELLING PRICE AFS
R 16,000,000* ZAR
Stock: R2,500,000
Assets: R10,000,000
R 342,422 ZAR
Summary

Well established Ice-cream cone and wafer manufacturer with strong market position.

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Fully describe the business's activities?
One of the owners started out as a baker, making cones manually. Through trial and error he honed the skills of baking wafers and making cones and in 1999 bought the first automatic machine for the business. The business has grown substantially from then and now in its current format is a manufacturer, wholesaler and distributor of wafers and cones, sweets and industry appliances. Its client base consist of Ice Cream Manufacturers, Wholesalers, Franchise Groups as well as the lower end market. The business currently boasts a strong market position and have just been contracted to manufacture cones for a large retail food group which will add to already impressive turnover figures.

How long has the business been established?
20 years

How long has the owner had the business?
Since inception

How does the business operate on a daily basis?
The factory operates 24 hours a day, 5 days a week and the factory manager takes care of all the operations. The factory production is planned in advance to cater for the orders from clients. The business also does its own deliveries.The business manufactures plain cones and flat bottom cones. the last few years it also distributes ice-cream related products as well as sweets and snacks.

How are the clients attracted to the business?
The business has an existing client base that orders from it. This is a niche market and they are well known in the industry.

What Advertising/Marketing is carried out?
The business has its own website and one of the current partners fulfils the duties of sales manager. They are well known in the industry.

Does the business have any contract work?
The business supplies its products on order to multinationals and franchise groups. Apart from adhering to stringent rules and food safety standards and fulfilling the procedures to be followed as laid down by its clients - the business does not have "fix"-order contracts. The agreements with its clients can best be described as supply contracts - each related to a specific product line.

What competition exists?
On some of the product lines there is competition in the market. On other products the only alternative for clients is to import the products. This industry has sizable barriers of entry.

What are the seasonal trends?
September through to April tends to be good trading months. During winter season the sales figures are lower but this business trades well throughout the year.

How did the Covid-19 pandemic impact the business turnover / daily operations?
The factory closed down for stage 5 in lockdown and resumed production in stage 4. Because of the nature of their product lines they are returning to full production heading into the summer months.

Is the business VAT Registered?
Business is Vat registered.

What VAT documentation is on file?
Up to date Vat returns on file.

Are there up-to-date Management Accounts available?
Yes available to qualified buyer.

What Balance Sheet and Income Statements are available?
February 2020

What is the age analysis of the debtors book?
No debtors over 90 days.

How could the profitability of the business be improved?
The owners have many great ideas on how to improve the profitability of the business and will discuss in person with a potential buyer / partner. Increase in sales and more products forms the basis of these plans.

What is the total staff complement?
One partner acts as factory manager. Quality control of the products is a separate function and managed as such. There is also a admin manager. Each shift in the factory is managed by a supervisor and there is about 30 - 50 staff depending on how busy the factory is.

Give a breakdown of staff/ functions/ length of service?
All staff details and functions will be available to qualified buyer.

Do any receive special perks or incentives?
The owners ( partners ) receive perks that will be disclosed to the potential buyer at time of negotiations. All staff is on a fix term contract with no special perks or payments.

How involved is the Owner in running the business?
All purchases and payments are done by one of the partners. Two of the partners are actively involved in the business and have no other business interest.

Is there an option of renewal & what period?
Yes, 3-5 year period.

What is the annual escalation %?
7%

What are the trading hours?
The factory operates 24 hours - 5 days a week (Two shifts)

What is the square meters of the business?
1300 sq/m - including factory, offices, reception, workshop and despatch. The factory and offices are in one building and the store room for the stock in an adjacent building.

Is a copy of the lease available?
Copy of lease is available.

What lease deposit and/or other surety is required?
1 month rental deposit.

What are the main assets of the business?
Assets include manufacturing machinery, delivery vehicles and general office equipment. All spares for the machines are kept on the premises to the value of approximately R500k. The business has just bought a new machine valued at R2 500 000-00. Full asset list will be made available to qualified buyer.

What is their overall condition?
All machinery is in good working order and serviced on a regular basis. All spares for the machines are kept on the premises to the value of approximately R500k. The business has just bought a new machine valued at R2 500 000-00

Do any require repairing?
Maintenance and repairs is done continuously as needed and forms part of the functions of the factory manager. The business boosts its own repair shop complete with a lathe and every tool needed for the job.

How have they been valued ?
All assets have been valued according to there replacement value.

Are they presently insured?
All the equipment, plant, machinery and vehicles are comprehensively insured.

Strengths?
Well run business with focused management. Sizable investment into plant, machinery and equipment to automate the whole process of cone manufacturing. On some product lines the business is the only qualified company in South Africa that can deliver the required product. Unique products and plans to further diversify with more products. Supplies to a well spread range of customers.

Weaknesses?
The business does not have the desired presence in the Western Cape, plans to increase sales in this geographic area are on the table.

Opportunities?
Expansion of the factory. Introducing more products. With an increase in the production capacity of the factory, the business may even compete with direct imports on some products. Expansion into the Western Cape.

What is the reason for the sale?
The operating partners are looking to immigrate.

Why is this a good business?
Unique product - mass produced. Sizable barriers to entry. Established customer base.

What is the price plus stock and the profit?
R13 500 000-00 including assets and excluding stock, debtors and creditors.

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FRANCHISE DETAILS

Aldes Platinum

1 members
7 active mandates
Gauteng , Midrand
8 Baltoro Crescent Midstream Hill
Midrand
0157

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