Ref. No - BFS936454

LocationSouth Africa, Western Cape

Ref. No - BFS936454

Sector - Manufacturing

Asking Price
R1,610,000
Monthly Profit
R 29,475
Asset Value
R 1,117,900
Stock Value
R 10,000
Yearly Net Profit
R 353,701

Summary

Producer and distributor of ice throughout the central Garden Route region. Strong asset base ensures supply can be met even during the summer holiday period. Long established and very lucrative business. Profitable with a strong asset infrastructure ensures continuity of supply even over the very busy summer holiday season. A well structured asset base and a debt free business with low cost of sales ensures profitability but strong management and controls required. Interested parties will be required to submit Proof of Funds prior to performing the Due Diligence.

Give me more information

Fully describe the business's activities?

The business is well established in the manufacturing and distribution of consumer ice.

How long has the business been established?

21 years+.

How long has the owner had the business?

Since Inception

How does the business operate on a daily basis?

The nature of this business requires strong management with regards to stock control and monitoring of receipts as a large proportion of the business is cash driven.
The Owner has a management structure in place that ensures an efficient business without significant shrinkage.
Owner oversees all General Management functions.

How are the clients attracted to the business?

The business has traded successfully for over 20 years and is very well known in the industry.
The customer base has shown steady and sustained growth.
Other players enter the market from time to time but few can sustain their operations as effectively as this one has.
Because of a strong asset base and infrastructure, they are able to keep their service levels high and therefore retain customers and regularly obtain new clients.

What competition exists?

There are competitors in the region, but its hard to copy the service levels offered by this business since it has been operating for many years and also have many of their own fridges in the various outlets.

Are there up-to-date Management Accounts available?

Yes, if and when required.

What percentage of the business is cash/credit?

This business is heavily weighted towards cash payments and as such there are only a few accounts which are well controlled.

How could the profitability of the business be improved?

The business has a very strong asset base for production and distribution which is a strong advantage over the busy summer holiday seasons as they can build stock beforehand and provide for the market requirements. (Contra to this, the winter months are very quiet and must be provided for.)
Opportunity to increase the distribution by putting in smaller depots and production in the regional centers away from the current location.
Opportunities to introduce similar products such as water and cool drinks exist.

What is the total staff complement?

6 staff exclusive of the owner.
Casuals are brought in when required.

How involved is the Owner in running the business?

The Owner owns the premises which he oversees as part of his daily responsibilities.
Due to the nature of the business, it is advisable that the new Owner retains the daily General Management responsibilities.
Not an ideal manager run operation.

When does the current lease end?

Owner is prepared to offer the Buyer a lease for an agreed period at a favorable rental.
But the Seller would like to restructure the premises and would encourage the Buyer to relocate after the initial lease expires.
Currently the business occupies two separate factories within close proximity of each other.

What are the trading hours?

Monday to Thursday:08-00 to 5pm.
Fridays to 4pm.
Summer shifts may be implemented.

Do you require a licence?

Required Health Certificates are in place.

What lease deposit and/or other surety is required?

1 months deposit.

What are the main assets of the business?

9 x Ice making machines at premises
55 x Freezers
3 x Freezer Rooms
Working tables
Sealing equipment
3 working vehicles for when necessary and 3 trailers
* (3 bakkies)
Cool Boxes. (vehicles have cool boxes for deliveries)
Over 55 fridges in the retail outlets
Cooler boxes, steel cabinets and other related assets

How have they been valued ?

At Owners second hand value.

Are they presently insured?

Yes.

Strengths?

This is a long established and well structured business with a major market share in the region.
The infrastructure is very efficient which ensures that production and distribution can cope fully over the busy holiday and summer periods.
Large distribution of supplier owned and branded fridges in the retail outlets ensure customer loyalty and wide brand exposure.
A number of containers owned by this business are situated on the premises of large customers ensuring supply over summer holidays.

Weaknesses?

Being a cash intense business management must be strong and strict controls and monitoring of all aspects of the business are necessary.
Because of the nature of the business the winter months are quiet and must be provided for.
(However the summer high period offsets this shortfall.)

Opportunities?

There is an opportunity to further grow the business by setting up regional depots in local towns as the equipment will allow for this.

Threats?

There are periodically small business operators who enter the market but they come and go as this is not an easy type of business to manage.

What is the reason for the sale?

The Seller has had the business for over 20 years and feels that he ready to move on and pursue other interests.
As a landlord he will generate passive income and will be able to focus on his many other interests.
Location

Contact | Enquire

Jan

Jan Badenhorst

LocationSouth Africa, Western Cape

Preferred method of contact

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