Coach Hire Company and Group Tour Operator For Sale

Business description

Established over seventy years ago – and along the way one of the very first coach companies to operate day trips to the coast, this Kent based business is one of the leading coach operators in its catchment area.

Operating from very well suited premises affording easy access throughout the South East via the M2, M20 and M25 motorways, this business operates a fleet of approximately 13 vehicles ranging from 6 seats through to 53 seater coaches - available for hire by private and institutional customers.

The bedrock to the business are the contracts it has secured with companies and several local schools in its area – operating the ‘school run’ on a daily basis for a number of educational institutions, building on these relationships with additional contracted school work – taking pupils to and from the local swimming pool, for example enabling the business to maximise its fleet utilisation throughout the normal working day.

More recently the business has added to the range of services it provides by launching a group tour operation having developed a number of known successful packages which include day trips to leading attractions ranging from Allthorp, Thorpe Park and Legoland in Windsor right through to the Hampton Court and Chelsea Flower Show. Alongside these day trips the business offers an extensive portfolio of London theatre trips taking in all of the major West End shows as well as offering a number of short breaks both in the UK and abroad. All packages are fully inclusive of all travel costs, accommodation, entrance, ferry travel and Eurotunnel where appropriate.

The cornerstone to the success of this business is its excellent reputation for reliability, safety and punctuality. Coaches from this business run on time all the time. Safety is most important with all coaches fitted with approved and certified safety belts. All vehicles – the fleet is one of the most modern around - are maintained to a high standard and full government specification and legislation whilst highly experienced drivers ensure particular attention is given to ensuring the comfort and safety of all passengers.

With a trading turnover of approximately £795,000 per annum, generating a trading profit of approximately £175,000 this business represents an excellent opportunity for an existing coach and coach tour operator to extend their penetration of the sector or for a new entrant to establish an excellent foothold in the industry by acquiring a very well established and major regional player.

Key strengths:

Having been in operation for over seventy years – rebranded approximately five years ago, this is a very well established business benefitting from high levels of awareness in the local area and a reputation for reliability and high levels of personal service.

The business operates a high standard of vehicle – the fleet is releatively new and is very well maintained. The fleet itself comprises a good range of size of vehicles, particularly good for the local roads used during school runs but also enables the business to ensure the most appropriate vehicle is used for size of the travelling party, optimising running costs wherever possible. With contracts in place with schools for the school run at the beginning and end of the day, additional school work during weekdays and events running during evenings, weekends and partiularly during the school holidays, the fleet and the business’s driving staff – the biggest overheads in the business - are utilised to the maximum.

On the events side, this business has established an excellent network of contacts – with ticket agencies, hoteliers etc and as a result is able to offer very competitively priced packages – certainly at a fraction of what it would cost to organize the trips individually – whilst still generating significant margins. And by selling trips well in advance with all monies required at the time of booking, the business enjoys excellent cashflow and profitability which it monitors very closely with very well developed management information systems.

Key opportunities:

There is an outstanding opportunity to build on the existing products, services and customer base of this company. With a strong demand for its services, combined with a capacity to increase turnover, a new owner contributing fresh ideas, motivation, enthusiasm and a little investment in marketing and advertising will have every advantage of building on an excellent platform.

Simply by leveraging the excellent reputation this business has built up in the schools sector – contracts come up for tender on a regular basis, this business could operate at a successful level for many years to come, however, it is the events side of the business, launched only relatively recently, that perhaps represents the greatest area for growth. None of the companies that could be considered to be the major competitors of this business pick up within its area resulting in this business having a virtual monopoly and by expanding its exposure across the many nearby major conurbations, this business would easily extend its penetration into the marketplace, picking up highly profitable incremental business – increasing its volume of customers without significantly increasing its overheads.

The fleet:

With approximately 13 vehicles – ranging from a 6 seater Mercedes Viano through to a 53 seater Mercedes Hispano coach – with options for 16, 25, 29, 33, 37 and 49 seater coaches in between, this business operates a fleet to meet all customer requirements.

Having originally been purchased using finance, the largest proportion of the vehicles are now owned by the business with whatever finance currently outstanding due to be paid off by 2012.

Financial information:

All financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler.

Annual turnover is approximately £795,000 generating a trading profit of approximately £175,000.

The Asking Price of £435,000 is for a sale of the shares in the business.

Full financial information will be available on completion of the necessary Confidentiality formalities.

Property information

Property:

Leasehold

Lease terms:

The premises are owned privately by the current owner of the business. Rent is currently approximately £12,000 per annum with Rates of approximately £5,500 per annum.

Location:

The business operates from very well suited premises including modern office accomodation and an on-site workshop, used for minor repair and maintenance. Approximately 2 acres in all, the secure site has ample space for parking all the fleet.

The premises are owned privately by the current owner of the business. Rent is currently approximately £12,000 per annum with Rates of approximately £5,500 per annum.

The premises are available leasehold, term and rent to be agreed subject to negotiation. The freehold conservatively estimated to be worth in the region of £750,000 valued in Spring 2008 is also available in addition to the Asking Price for the business, subject to negotiation.

Other information

Competition / Market:

Well established, with such an excellent reputation and high levels of awareness, this business has little need to invest heavily to market its standard coach hire services. What marketing the business currently undertakes is to promote its events – concentrating on door drop campaigns around the local area. The business has also invested heavily in a very well designed, informative website that performs very well in all the major search engines for all appropriate search terms. The site includes on-line booking and datacapture facilities – the latter of which is helping build a substantial electronic database for e-mail marketing of future events, special promotions and offers. Above all the business benefits from the most cost effective form of marketing, strong word of mouth recommendation, testimony to the excellent service and high levels of customer satisfaction the business engenders.

Support & training:

The current Owner will provide full business familiarisation, training and handover to ensure a smooth transfer of the business to the new Owners.

Reasons for selling:

The current Owner of the business wishes to pursue other business interests.