Sector - Manufacturing
Profitable business with a solid foundation of income and profits being generated, with potential to expand the product lines, use the location and space of the premises more effectively, and to have targeted sales and marketing introduced into the businessGive me more information
About this Business
This business is based in North West Province and was established in 2006 (Registered in 2010) this business manufactures and distributes bricks to an area covering 150km from their yard, they are well located and highly visible next to a very busy road.
Channels to Market Summary
The business operates from a single premises just outside of town, where they manufacture as well as manage the administration of the business, this includes walk-in customers enquiring on the different bricks supplied by the company. - Advertising is currently very limited as most of the business is attracted either through Word of Mouth or through potential customers passing by the business on the main road. - The company provides delivery services through its own fleet of vehicles. - Larger projects are tendered for based on enquiries from the region.
Potential Business Development Upsides
There is very little advertising and directed sales programs being done by the company, and similarly a competitive analysis of competitors in the area showed the competition communications are similarly fragmented, this provides a potential purchaser to activate not just targeted sales drive (actively driving sales through a dedicated sales resource to business and industry in region), but also an active advertising drive through at least the basic channels such as Web page and Facebook, which should lead to greater exposure and sales for the business. - The location lends itself to greater walk-in business, and by expanding the product lines to include outdoor garden products greater revenues can be created from a larger variety of products, especially since the yard is rather large and allows for better utilisation of the ample space for displays of not just the bricks being supplied but also additional products for garden and home.
The Competitive Environment
Research showed one immediate active brickyard type competitor in the area, and a number of smaller contractors that in most cases purchases directly from either this business or the competitor in the market. - The above the line and below the line advertising of the business and its competitor is however very fragmented and limited, and even well known brands in the area has very limited advertising programs, there is definitely opportunity to shake up this market through targeted drive of promotional activities.
Supply Chain Summary
The trade relations with industry is well established and as such the business built supply chains that serves the business well in their needs, similarly the business is also an authorised distributor of well known brick brands in the region.
The business is well established with full audited financial statements, VAT Returns and Management accounts available. - The business generated just over R7m of revenues for the last financial year to February 2021 and showed a profit of just over R2m. - The trading trend showed that COVID in April had a big impact, yet the business rebounded from May 2020 onwards.
What is the Selling Price Structure
The owner wishes to sell the business at R12m, this price includes assets of R4.8m (Asset List Available - Owner based value on estimations of used replacement value and a discount factor)
Staffing Structure and Summary
There is a total of 24 staff members in the company, which includes the owner as the overall operational manager of the business, 3 office and administration staff and 20 staff within the yard operations.
The yard area is estimated at 2,5 hectares and is leased premises. Manufacturing is done at the Yard through VB Machines. The sales and administration is done from offices on the premises. Lease can be taken over and existing landlord have no objections on resigning a lease with potential buyer/s of the business.
Why is owner selling the business?
The owner wishes to relocate with his family to the West Coast
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