WHO WE ARE
This business is one of two importers and distributors of OEM Remanufactured Toners in South Africa with an active agreement with SITA (regulator for Government IT products and SCM)
We are the sole accredited importer and distributor for remanufactured OEM toner cartridges. We started trading as a distributor, supplying to 3 resellers in 2021 and in 2022 we made our product available to all resellers approved on the panel of the RFB 740 contract.
WHAT DO WE IMPORT AND SUPPLY
We import original OEM remanufactured toner cartridges. These toners are used original toners that are collected and sent to the factory in the UK to be sorted and inspected on an assembly line. Parts are replaced if needed, and the product is filled with the approved powder. The factory complies to yield requirements and other strict requirements. Certificates are available on requests.
PURCHASE CYCLE (WE DO NOT SUPPLY DIRECTLY TO THE PUBLIC SECTOR)
We purchase stock on a COD basis from the UK, we mostly make use of air freight as our profit margins are 60% plus. The processing of the order, payment and delivery takes about 5 days in total and stock is delivered to our door.
The SME’s that are approved on the SITA panel, receives a RFQ from the Dept. / end user. We quote the SCM and the SCM quotes the end user / Dept.
The SCM then receives a purchase order from the end user / Dept. and places a purchase order with us (importer /distributor). We deliver free of charge via the courier to the end user / department after payment was received. We do not quote or invoice the end user / Dept. directly.
PAYMENTS
All SCM’s that purchase stock from us, pay cash or they make use of a Purchase Order Funding
WARRANTY
We offer a 2 year warranty on our toners. We have a warranty letter from the factory to offer us continued support during our contract. If any toners are faulty, we request a print out from the printer and images as proof. Based on the evidence provided we do a swop out.
Stock is to be kept in a cool and dry environment. No direct sunlight is allowed. The powder can not expire if kept in this required condition.
BENEFITS FOR SME'S AND BUSINESSES INCLUDING PUBLIC SECTOR
Our product offers a cost saving of 15-20% to end users, where SME’s can benefit by making 25-40% profit margin compared to the very small profit margin of 5% when selling OEM branded toners. OEM’s discontinue printers from time to time and releases new printers with the the specified toners. This results in no further manufacturing of the toner for the discontinued printer models.
Many hospitals, police stations and magistrate courts still make use of these discontinued printers that are in a working condition, and we can continue to supply without them having to replace the printers. A recent letter from an OEM announcing the discontinuation of toners is attached as well as a proof of a RFQ from a Department, requesting these discontinued toners.
RECYCLING
We offer empty recycling boxes to departments where all empty cartridges can be dropped. When the box is full, the department can call the contact number on the box to arrange a collection. This method is used for advertising the business within the departments can empty’s can be sold.
SITA PRESENTATION
SITA prepared a presentation explaining third party consumables in Government. This covers: confusing terms, misinformation, SITA approval process, compliance and criteria, Lab tests procedure, certification process, where to find it on the website, delivery checklist, service and support.
ADVANTAGES OF THIS BUSINESS DURING PANDEMIC
During a pandemic, our business is exempted and we can still continue to supply departments. This will mostly cover Department of Defence and all hospitals.
EXPECTED FROM BUYER
The potential buyer will be expected to build relationships with current SME’s and continue to visit departments (especially hospitals) to do product presentations and supply updated pricing to SME’s.
OPERATING COSTS
The business only has these main costs: Storage of stock, packaging wrap for stock, courier, packer, internet and administration
GROWTH POTENTIAL EXPLAINED
Our factory in the UK is the supplier of all remanufactured inks to TESCO and other retails stores. This section has grown significantly in their country and definitely an option to develop and grow with their experience and support in SA. Currently we only supply to the Public sector and have not explored the private or retail sector yet.
CURRENT CONTRACTS AND VALUE
We have a valid contract/MOA with SITA to supply to all SME’s (1400 dealers) till end of July 2027. The MOA and certificates have an expiry date on them. The MOA is renewable. SAPS issued us with an accreditation letter for the RFB 740 contract.
We receive RFQ’s from SME’s on a daily basis and submit quotations to them. Orders come in on a weekly basis. I attached a sample of these purchase orders. – SAPS / DEPT of Transport. The SME’s place the order with us and we deliver directly to the department after payment is received.
In addition to this, we recently submitted pricing to SME’s for a RFQ to the value of R4,2 million rand over a period of 3 years. This information can be made available upon request. The department specifically requested OEM remanufactured toners and is still busy with the evaluation. There is a 90% probability that we will be requested to supply the stock.
WHY THE BUSINESS IS FOR SALE
Being the only active person in the business, the business sales dropped due to my absence since April 2023. I relocated to KZN to support my children to enrol them in the needed schools. I was hoping to still operate the business from here, but I could not close many deals where the clients required presentation meetings.
The business did extremely well during the first and second year of trading, however my absence by not visiting clients / end users resulted in losing many orders over the value of R3,4 million, against my opposition.
It is clear that the business is a working model but requires a dedicated sales director and relationships manager.
