Sectors / Category

Annual turnover

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  • Mandate: 34380
  • Added: 03 Dec 2020
  • AFS
  • 1247

Established Business Manufacturing Retail Consumer Products

Eastern Cape, Port Elizabeth
1247
Mandate 34380
Added 03 Dec 2020
R 11,660,000* ZAR
Stock: R 330,000
Assets: R 5,019,600
R 163,357 ZAR
Willem Smuts
(PRINCIPAL)
Aldes Algoa
Eastern Cape
Eastern Cape
Summary

Established in the 1980's, highly profitable and almost a monopoly in its products. This business is well established, equipped with the latest technology and equipment, boasts with a firm client base and generating an Ebitda income of R 168 000 per month. The owner wishes to retire and is serious about selling.

Established Business Manufacturing  Retail Consumer Products
SELLING PRICE AFS
R 11,660,000* ZAR
Stock: R330,000
Assets: R5,019,600
R 163,357 ZAR
Summary

Established in the 1980's, highly profitable and almost a monopoly in its products. This business is well established, equipped with the latest technology and equipment, boasts with a firm client base and generating an Ebitda income of R 168 000 per month. The owner wishes to retire and is serious about selling.

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Fully describe the business's activities?
The business activity consists of manufacturing, packaging, distribution, and marketing. The working hours are Mondays to Fridays from 8 am to 5 pm with a total staff complement of not more than 10 staff members.

How long has the business been established?
The business was established in 1995

How long has the owner had the business?
The owner started the business.

What steps are in place to solve 'load shedding' problems?
The business is situated in an area where load Shedding is prohibited and has never been exposed to load shedding.

How does the business operate on a daily basis?
The raw materials used in the manufacturing process in ordered in bulk on a monthly basis. The product range is not to big and sufficient stock of each product is held in storage and ready for dispatching. Each product has a minimum level indicator which immediately stimulate the production of the product.

How are the clients attracted to the business?
The success of this factory depends primarily on local market volume in the eastern cape and it is possible to expand beyond the Port Elizabeth and Eastern Cape area.

What Advertising/Marketing is carried out?
Word of mouth advertising, social media and agents calling on distribution centres, shops and grocery retailers.

Does the business have any contract work?
No contract work but preferred supplier as virtually no competition in business.

What competition exists?
Limited competition from one other manufacturer.

What are the seasonal trends?
This factory follows the retail pattern of busier in Summer and slowing down in Winter months.

How did the Covid-19 pandemic impact the business turnover / daily operations?
Covid did have a negligible impact on the demand for the product for the month of March 2020, but as grocery stores were allowed to trade during this period and this business is classified as an essential services provider, sales and deliveries did proceed.

What steps / actions have been taken to combat the effect of Covid-19 pandemic?
All staff have to adhere to the strict Covid Pandemic regulations of social distancing, sanitising and wearing of masks at all times.

Is the business VAT Registered?
Yes, the business is VAT registered.

What VAT documentation is on file?
Bi monthly VAT Returns as requested by SARS

Are there up-to-date Management Accounts available?
Up to date Management Accounts available.

What Balance Sheet and Income Statements are available?
The 2020 Annual Financial Statements should be available shortly.

What percentage of the business is cash/credit?
95% of the business is done on a "30 days from Statement" basis and 5 % to cash buyers.

What is the age analysis of the debtors book?
95 % of clients adhere to credit term of 30 days from statement. Strict collection process of carried out on late payers and business is listed for credit insurance.

How could the profitability of the business be improved?
At the premises is a huge building equipped for the manufacturing of a different consumer product. all equipment is in good working condition and this plant could increase the offering of the business.

Is Seller finance available and for what amount?
Seller wishes to retire and no financing is available from the seller.

What is the total staff complement?
The total staff presence on-site is approximately less than ten members.

Give a breakdown of staff/ functions/ length of service?
All staff members have been with the business for a reasonably long period. they are well skilled and trained in their work and can cross skill if someone is ill or absent. The staff functions consist of supervisors, machine operators, packers, general assistant, and one secretary and PA for the owner.

Are they on contract?
all staff on Permanent Employment Contracts

Do any have management potential?
The Supervisor has excellent managerial skills.

How involved is the Owner in running the business?
The owner is 80% involved in running the business.

When does the current lease end?
The premises are the property of the owner and the intention is to sell with the business.

What are the trading hours?
The working hours are Mondays to Fridays from 8 am to 5 pm.

What is the square meters of the business?
At the premises is a building of ample size ( 825m2)equipped for the manufacturing of different consumer products and all the equipment is in good working order and another sub-division of the business can be revitalized after the owner restricted production of a manufactured product ( Due to his retirement consideration). This revitalization could contribute another 40 /50 000to the bottom line!

Do you require a licence?
No license is required.

What are the main assets of the business?
The main intangible asset of the business is the loyal staff ( some employed for over 20 years) and the repeat orders from existing clients. a complete Asset list will be made available for interested buyers.

Are any items not included in the sale?
all items on the Asset list will be included in the sale.

What is their overall condition?
well maintained and excellent working condition.

Do any require repairing?
No repairs required at this stage.

How have they been valued ?
They have been valued at a realistic market related value.

Which assets are on lease/HP and with whom?
All assets and equipment are fully paid.

Are they presently insured?
All assets, equipment and buildings are comprehensively insured.

Strengths?
This business is lucrative, established, and highly profitable. They manufacture a product for which there is no alternative replacement and used by each and every retail store, restaurant, fuel stations, etc. The factory is situated close to the highway and harbor with easy access to Warehouses, depots, distributors, etc.

Weaknesses?
This business is situated in an industrial area, correctly zoned, and very limited competition from the opposition manufacturers.

Opportunities?
This is an excellent opportunity to enter an established and profitable business that virtually has no opposition. For opposition to enter the market will cost millions is set-up costs and would not be able to deliver a product at a competitive price..

Threats?
This business is situated in an area that will always be a high-end industrial area. Close to the harbor, freeways, airport, and distribution outlets. The business does not pollute in any way and complies with all health and safety requirements. we see no threats to this business.

What is the reason for the sale?
The owner wishes to retire.

Why is this a good business?
This business is well established, highly profitable, and lucrative in all respects. It is manufacturing a product for which there is no alternative and has basically no opposition. The present owner is prepared to assist the new owner in expanding the business and stay on for a period of at least a year at a reasonable remuneration

What is the price plus stock and the profit?
The asking price for the business is R 7 500 000 and the buildings R 3 500 000. the stock on hand is estimated at R 330 000 but will be finalized by physical stock-taking on the Effective Date of take-over by the new owner.

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FRANCHISE DETAILS

Aldes Algoa

1 members
16 active mandates
Eastern Cape
16 Frykenhuis Street, Summerstrand
6001

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