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LocationSouth Africa, KwaZulu-Natal

Sector - Food

Asking Price
R5,300,000
Monthly Profit
R 196,188
Asset Value
R 990,000
Stock Value
R 1,000,000
Yearly Net Profit
R 2,354,259

Summary

Steady Net Profits again ! (closed off 2019 Management Accounts). Butchery that covers meat processing, cold storage & retail store, in the North of Durban. Operated for 26 yrs - with managers in charge of 3 divisions & owner merely controlling. Turnovers of R48m pa, lead to Net Profits of R2.6m pa, while the Sale Price is an excellent R5.3m excl stock of R1m (with Current assets & liabilities to the sellers account)

Give me more information

Fully describe the business's activities?

Steady Net Profits again ! (closed off 2019 Management Accounts).
Processing & Cold Storage Plant separate from the Retail Butchery (2 separate CC's) that are integrated from a business perspective, within Durban's Northern Suburbs. Well known & long established, with managers & staff in place, requiring minimal owner involvement.

How does the business operate on a daily basis?

Bulk meat/whole carcasses are purchased in, then processed & packaged for the butchery & offal sales. Main product lines are lamb, & chicken portions, as well as, self-processed sausages.

What Advertising/Marketing is carried out?

None

What competition exists?

Various competitors, but independents lack price & quality competitiveness (through bulk buying & storage capabilities), while chain stores lack the product variation & quality aspects.

How could the profitability of the business be improved?

Push to supply restaurants, hotels, etc.
Advertise the butchery in local papers and create a website (perhaps with recipes etc)

Give a breakdown of staff/ functions/ length of service?

Across functions with 8 having more than 10 yrs service

Do any have management potential?

The managers of each of the businesses operate their sides independently & without requiring supervision or management !

How involved is the Owner in running the business?

Established & operated for 26 years by the owner who wishes to retire, and who has ensured that all managers & staff operate the business without the owners intervention.

When does the current lease end?

Processing & Cold Storage : Owned by seller;
Butchery : July 2018

What are the trading hours?

Processing & Cold Storage : 6 days: 8-17h00;
Butchery : 7 days: 8 -18h00

What are the main assets of the business?

Processing & Cold Storage : Plant & machinery, consisting of cold storage rooms, metal tables, saws, meat extruders, knives, 2 delivery trucks - Cost R3.7m depreciated to zero, but worth some R690 000. To clarify: 4 freezers & 1 blast room = 350 pallets (but 1 small freezer & the blast room, equal some 140 pallets thereof are actually not used and are off at the moment)
1 cold room for some 350-400 carcasses and approx. 60-80% used
Butcheries : Display fridges, racks, tills & counters, security systems - Cost R1.8m, depreciated to zero, but worth some R300 000.

Strengths?

Well known & long established, with managers & staff in place, requiring minimal owner involvement.

Weaknesses?

Perhaps low owner supervision allows for pilferage which if picked-up could improve profits

Opportunities?

Push to supply restaurants, hotels, etc.
Advertise the butchery in local papers and create a website (perhaps with recipes etc)

Threats?

Other competitors could come into the area, but if not vertically integrated as this business is, then any new business is unlikely to actually be real competition.

What is the reason for the sale?

Established & operated for 26 years by the owner who wishes to retire.

Location

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Cliff

Cliff Bell

LocationSouth Africa

Preferred method of contact

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