Normalized Cash Flow: $350,000
What they do – the short version . . .
• Source customers looking for dry cargo transportation to Central Alberta businesses.
• Their trucks pick up from a major centre and deliver according to customer instructions.
• They also source deliveries from Central Alberta to larger centres.
• Senior administration and management will stay with he firm.
• All equipment is in good working condition.
Jewel Transport is a profitable transport company with a diverse and well-developed customer base. The firm is running both owned and leased equipment from the big city to Red Deer and smaller commercial centres in central Alberta.
They have 10 years of customers and experience in the delivery of dry goods directly to customer locations. It is a profitable operating arm of a larger transport firm looking to slim down.
The comfort of continuing management will be a boon to the new ownership.
This will be a share sale. There are three years of full financials available to qualified buyers plus an up-to-date equipment list.
The firm has an excellent policy and procedures manual ready for the new ownership.
The work load is even over the year with the summer somewhat slower and the fall busier.
Employees need a Class 1 and Class 3 drivers licences
There are eight employees all with a required forklift course and training.
Jewel Transport has a relatively low staff turn over.
Two staffers could be considered ‘Key Men’. There are trained back ups for the key men.
The seller estimates the numbers above are the result of 15,000 man hours and that business can continue to grow without the need for more staff.
Their trailers are owned outright. Most of the trucks are leased and are relatively new. There is room for the business to grow without the need of new equipment.
Their leasing company maintains the trucks.
Administration is mostly a digital system that tracks electronic waybills. Office staff invoice weekly.
Hours are 7 am to 6 pm.
There is a safety program in place but they do not need trained first aid attendant on staff. There are no hazardous materials in their operation.
Jewel Transport has good WCB history. There is a recently updated safety manual.
Customers expect and get daily freight delivery.
New customers come from referrals and some limited advertising.
They have their own web site and an ad in the Yellow Pages.
A high percentage of their business is from repeat customers. Their top five customers can account for three quarters of their business.
Their largest customer is their parent company accounting perhaps 40% of revenues. This means that any deal will need to include a contract with the seller.
Three years of financial statements and a complete equipment list is available for qualified buyers.
Q. In your words, what does the firm do?
A. We are a freight delivery company.
Q. What functions does the owner perform? What talents will the new owner have to replace when you leave?
A. The new owner will need to manage staff and administration.
Q. How long will you stay after the sale to help in the transition?
A. We are flexable.
Q. Can you estimate what it would cost for a competitor to start up?
A. At least $250,000 plus the time costs of building up a customer base.
Q. Have the accounts receivable been purged of bad debts? (This will is really a lawyer question).
A. This is done on a continuing basis,
Q. Will you agree to a non-competition clause?
Q. Who should buy this business?
A. Somebody looking for a proven well established business that has a diverse well established customer base. Our competitors in the in the transport industry, or a user of freight services in a similar location.
Interested? Next steps:
1. Fax / scan the non-disclosure document
2. Phone discussion
3. Release of financial information
4. Meeting with seller and tour of premises
5. Discussions that may lead to a deal
The information on contained in this document has been provided from sources believed to be reliable. You must seek independent verification of these facts through due diligence before taking any action based on this information.