Sectors / Category

Annual turnover

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  • Mandate: 34451
  • Added: 05 Mar 2021
  • AFS
  • 425

A RESPECTED COURIER BUSINESS IN THE WESTERN CAPE

Western Cape, Overberg & Breederiviervallei
425
Mandate 34451
Added 05 Mar 2021
R 15,874,726* ZAR
Stock: R 0
Assets: R 4,874,575
R 277,626 ZAR
Walter Schonborn
Aldes Absolute
Western Cape, Villiersdorp
Western Cape, Villiersdorp
Summary

Highly successfully courier business operating for over 23 years, providing comprehensive courier services that generates turnover of R 22mil annually with nett profit of R3.3 mil utilizing a reliable fleet of 32 vehicles with a depreciated value of R 4.8 mil.

A RESPECTED COURIER BUSINESS IN THE WESTERN CAPE
SELLING PRICE AFS
R 15,874,726* ZAR
Stock: R0
Assets: R4,874,575
R 277,626 ZAR
Summary

Highly successfully courier business operating for over 23 years, providing comprehensive courier services that generates turnover of R 22mil annually with nett profit of R3.3 mil utilizing a reliable fleet of 32 vehicles with a depreciated value of R 4.8 mil.

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Fully describe the business's activities?
Customers will book a courier service with one of the 9 office staff. The courier will collect the parcel that is booked either from a specific address - that could be your place of work or your home - or from a drop-off location. From there, the courier will take the parcel (along with hundreds of others collected that same day) to the nearest depot. At the depot the parcel is sorted with others that are addressed to a similar area. Parcels will often be sent to another depot closer to the delivery location, where it will be assigned to a driver based on their area of coverage. The next driver takes the parcel from the depot and delivers it to the recipient on his or her next delivery.

How long has the business been established?
During 1998 the current owner and founder of the business identified a need for an effective courier service based in the Breederiver geografical area. The business started off with an overnight courier service to Cape Town with one vehicle and two staff members. Today, 23 years later, the fleet consists of 32 vehicles and 34 permanent drivers.

How long has the owner had the business?
The current owner started the business 23 years ago

How does the business operate on a daily basis?
Being a structured and disciplined person the owner, over the years adopted a service company synonymous with delivering excellent service. The adoption of this service orientated culture was fundamental to the long term success of "the business" as a service organization with established loyal customers. Th Business also has a good and mutual beneficial working relationship with competitors in the courier industry. When making use of the services of a competitor it is referred to as "sub-contracting" of services. It allows the business to extend its service to a market which is not economical viable to service on its own. The company's extensive market coverage and domination of the Breerivier geographical courier market, which cannot easily be duplicated, is what makes the business such a valuable and sought-after asset. Running the day to day operations of the business is a self-sufficient management team who consists of a manager and 9 (nine) competent office staff. The business collect and deliver in the following areas/routes: Worcester and surrounding towns; Bonnievale, Ashton, Robertson Touwsrivier, Lainsburg, Sutherland De Doorns, Rawsonville Ceres, Tulbach, Wolsely Paarl, Wellington Cape Town district (Southern- en Northen suburbs) By making use of sub-contractors the following areas are also serviced; Stellenbosch, Strand, Somerset-Wes, Gansbaai, Bettysbaai, Kleinmond, Grabouw, Caledon, Onrus, Hermanus, Moorreesburg, Malmesbury, Porterville, Riebeeck-wes, Riebeeck Kasteel, Eendekuil, Bredasdorp, Hopefield, Napier, Piketberg, Swellendam, Darling, Riviersonderend, Laaiplek, Velddrif, Vredenburg, Saldanha, Mosselbaai, George, Heidelberg, Knysna, Struisbaai, Stilbaai, Plettenbergbaai, Oudtshoorn, Barrydale, Ladismith, Springbok, Bitterfontein, Beaufort-Wes, Calvinia, Carnarvon, Victoria-Wes, Kenhardt, Keimoes, Kakamas, Upington, De Aar, Hanover, Stanford, Citrusdal, Graafwater, Gouda, Hermon, Lambertsbaai, Clanwilliam, Klawer, Lutzville, Vredendal, Trawal, Riversdal, Albertinia. The company has its overnight distribution depot in the Breederivier district where parcels/ goods, delivered at the depot before 16H30, will be delivered to Springbok / Plettenbergbaai / Oudtshoorn / Upington etc, the very next morning.

How are the clients attracted to the business?
The owner believes that customer satisfaction will lead to an increase in sales and that satisfied clients lead to reciprocal business from loyal customers The company has a proper and functional web-site. The business enjoys a visual presence with the 32 branded and well maintained delivery vehicles, creating a good impression and company image. The company is actively contributing and participating, through non-profit service organizations, to alleviate the needs in the community.

What Advertising/Marketing is carried out?
* All vehicles is branded with company logo's and services offered by the company. * The company's website is not too long, have a user friendly design and contains all essential information about the company and its services. * The company is active on facebook. * The company sponsor the Mega Oval Kleinplasie stock car hosted in Worcester. Visible branding at the venue, participating cars and Mega Oval Kleinplasie website. * The company is a yearly sponsor of the golf day in aid of Pioneer School for the visually impaired situated in Worcester. * The company is greatful to be priveleged to participate in the annual Pioneer Rally

How did the Covid-19 pandemic impact the business turnover / daily operations?
Covid-19 also affected the turnover and operations of the business. After a few structural changes the company remarkably managed to maintain profit margins achieved before the pandemic.

What steps / actions have been taken to combat the effect of Covid-19 pandemic?
As a reputable and responsible company all necessary protocols and procedures have been put in place to ensure the safety of the employees of the company, the community and its customers.

Is the business VAT Registered?
The business is Vat registered and all documentation is on file. All vat payments are up to date.

What Balance Sheet and Income Statements are available?
Financial statements for the financial year ending February 2020 are available. Up-to-date management accounts are available.

Monthly Turnover March 2020 - December 2020
Monthly Turnover Trends 000's : March 1294 April 342 May 689 June 1470 July 1376 August 1460 September 1824 October 1565 November 1790 December 1396 This period reflects the effect that Covid 19 had on the business. It is important to note the recovery of the turnover after lockdown.

What is the total staff complement?
Staff complement is 41. Further detail regarding staff and their remuneration contains confidential personal information and will be made available at the appropriate stage.

Do any have management potential?
The business is currently manager driven. The owner is still involved in management. Proper "checks and balances" developed over the years allows the owner to be semi-retired whilst still having control over the day to day running of the business. The current manager indicated the he/she will stay on with the company after a sale.

Any special arrangements for the staff related to the Covid-19 pandemic?
All possible precautions have been taken to ensure the safety of all staff as well of its customers. The business strictly adheres to the promulgated law regarding Covid-19.

When does the current lease end?
The company rents two premises, in the Breede Valley ( head-office) and a depot in Parow. Breede valley offices; *R27 000.00 per month *Deposit R23 000.00 *523 square meters *Contract indefinite, 60 day cancellation notice period Parow Depot; *R33 793.00 per month *Deposito R23 000.00 *750 square meters *Expires 30 June 2021. Option to renew contract. Storage in Paarl; *R1250.00 per month *Deposito R0 *Month to month basis

What are the trading hours?
Trading hours; Monday to Friday 07H30 to 17H00

What are the main assets of the business?
The main assets consist of office equipment and a well-maintained fleet of vehicles and trailers valued at a depreciated value of R4 874 575 ( 2020 financial statements) . All vehicles are bought out of the business's cashflow. No lease or HP's. The overall condition of the vehicles are good. Vehicles under factory warranty are serviced at the appropriate dealer. Vehicle out of warranty is serviced at a service-center. Coming from a disciplined working career the owner believes in a robust program to carefully maintain and manage the vehicle fleet in order to avoid unforeseen and expensive downtime as well as disruptions in service levels.

How have they been valued ?
The value of the assets has already been depreciated. I list, containing all assets and its depreciated values will be made available during the due-diligence process.

Strengths?
* Strong and effective management team attending to the day to day running of the business * Effective and happy employees *The business culture is about delivering exceptional service to its customers. * The latest vehicle tracking and monitoring devises are used in daily operations. * During the past 21 years the business established a good name and reputation, associated with reliability and service excellence, in the market. * Visible branding of vehicles. The professionally designed logo with its black and orange colours is very effective. * New clients are referred to the company by "word of mouth" * Mutual beneficial working relationship with other courier companies. This relationship enables the company to deliver a service to almost the whole of South Africa.

Opportunities?
More potential can be unlocked be expanding / developing the working relationship with other bigger courier companies.

Threats?
Competition in the market is intense. The local and international economies pose a threat business.

What is the reason for the sale?
The owner is thinking of retirement

Why is this a good business?
Although the courier, express and parcel services sector faces weak economic conditions, it is benefitting from the growth in e-commerce sales, increasing demand for just-in-time deliveries and from the poor service provided by the post office. Increasing customer demand for speedy and flexible deliveries and the growth of disruptive startups and innovative delivery options are forcing traditional operators to review their distribution strategies and in some cases partner with or invest in new disruptive on-demand delivery companies to provide innovative and alternative delivery options. The Breedevalley district still has functional municipalities and its economy is driven by farming activities which brings foreign money into the region. Dispite the covid-19 pandemic, and other economic set-backs the Breedevalley district's economy is still performing well. It is very difficult for any outside business to establish a profitable footprint in the Breedevalley area due to the geografical area (With Worcester in the middle ofsurrounded by 10 smaller towns) as well as the loyal client base. It is always better to buy an existing business in the area than starting one.

What is the price plus stock and the profit?
We, Aldes Business Brokers, relied upon four methods under the Assets, Market and Income approaches to do the business valuation. We assign a weighting according to each result and calculate our estimate of the business value as the sum of these weighted values. Our indicated business value is R15 874 726.00 The Seller will keep cash and cash equivalents such as accounts receivable, notes receivable, certificates of deposits and specific any and all investments in the name of the Seller.

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FRANCHISE DETAILS

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