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Courier Business In East Rand For Sale

East Rand, Gauteng
Asking Price:
R8,000,000 Furniture / Fixtures included
Sales Revenue:
R17,000,000
Cash Flow:
R3,200,000

- The business was established in 2004. It was started by the seller and the member’s interest of the business is held 50/50 between the seller and his wife.
- The business originated in Kwa Zulu Natal after which a branch was opened in Gauteng in 2005. This branch soon became the head office.
- In 2010 the business opened a branch in Cape Town which is currently a 50% contributor to the revenue stream after the smallest branch (KZN) was sold in 2016.
- It is essentially a retail express courier service. A core segment involves parcels imported to clients from foreign destinations and also parcels from clients to be forwarded to foreign destinations. The business do not engage in warehousing and distribution activities but this could be a natural next step diversification.
- The fleet in Gauteng consist of 6 vehicles and 3 vehicles in Cape Town.
It serves approximately 70 regular clients in Gauteng and 40 in the Western Cape.

Property information

Real Estate:

Lease

Lease Terms:

5 Year lease with renewal option and 8% escalation per annum.

Leasehold Rent:

R360,000 per annum

Location:

One branch operating from the east Rand near the airport and the other in Cape Town.

Premises Details:

- The premises in Gauteng is based in the East Rand. The business has a 5 year lease with an option to renew. It is operating from a business park which offers good security and the offices/working environment is modern, clean and pleasant. Rental is R24,000 per month for 370m2 operating area. Express access to the airport and highways.
- In Cape Town the business from a 150m2 area with a monthly rental of R6,000.

Business Operation

Expansion Potential:

- The business is currently considering a second full time representative. One will be responsible to maintain and service existing clients and the other to identify and develop new customers.
- The new owner can also consider diversifying into distribution and warehousing opportunities.
- A strategy for consideration would be to reduce outsourced functions and bring them in-house.
- A general increase in electronic marketing advertising in order to achieve capacity optimum.

Competition / Market:

- There are at least 10 very large Multinational and 5 large national courier companies operating in the same space. It is a massive business segment with many 1000’s of transactions every day, 365 days per year.
- There are also dozens of smaller and independent operators that compete for business daily.
- These large competitors have a very strong brand awareness in the market as a result of very large marketing budgets and the ability to deploy state of the art software and other systems. It however has expensive structures and overheads.
- The Seller has experienced it relatively easy to compete on price and service and has grown its business steadily over the years despite following a very moderate growth strategy.

Reasons for selling:

- The seller has experienced ill health over the past year and is desirous to scale his activities down.

Trading hours:

- Official operating hours are between 07:00 and 18:00 daily Monday to Friday and 07:00 to 13:00 on Saturdays.

Employees:
17
Years established:
2004

Other Information

Furniture / Fixtures value:
R800,000 - included in the asking price
Relocatable:
This business can be relocated.

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