Yesterday I spent the day with my old army buddy who I have known for 35 years and we know each other very well. We tend to meet up every other month or so when he spends the week in Johannesburg visiting his business.
The discussion is around the family and then we spend a few hours discussing each others business seeing if we can find areas to improve. I advised him on certain things with regard to a couple of overseas clients with regard to costings and reducing their bills slightly. This he agreed was a good idea and one he will implement at the start of the New Year.
With regard to my warehouse business he offered a solution where we pay $1K monthly and join an app which offers wholesale logistical prices with regard to deliveries. This was something I was going to do with one of our service providers in January and it was good to see they were listed on the app already so there is now no need to go and re negotiate a new deal. The first few months I will piggy back using his log in details to make sure it suits our needs before signing up. Our courier bill should be reduced by as much as 30-40% which would more than cover the $1K fee and should see some decent savings. We all need to work smarter and by sharing information we can help each other.
The other part of the day was discussing a new business proposal regarding a packaging production facility business. The deal hinged on whether I would agree to come on board as a partner in the New Year as I have previous production line experience. This new project was the first time I was hearing about this and was wondering how it would fit in with all the other projects I have. This was more about how much of my time was required so I could give this project the time it requires. This is so simple it is actually boring. but boring is also very good when it is profitable.
The first batch arrives in January and will be packaged by another company until we get new premises secured and the correct machinery in place. I actually have the space to do this at home and will get that area refurbished and ready by mid February. Why rent when you do not need to and the area used would be a tax incentive for myself. I was looking at the numbers and I think what sold me on the idea was the company needing 2400 items packaged daily. These are small enough numbers for a one person operation to be completed in less than 2 hours each day. The machinery required is standard and nothing special all programmed to pour the contents by a fixed weight measurement followed by the bag being heat sealed. Two or three very simple processes with very little investment capital required.
What else sold me is if the deal was agreed and our Johannesburg facility was successful we had to commit to another two operations being set up in the UK and Spain/Portugal. The UK numbers required I am sure will be far higher than what is required in South Africa so this would be a good starting point in order to learn the production system.
Life is kind of crazy when you are not looking for additional work it tends to find you. This is not something you can turn down and have already agreed the terms of the deal. When you will be working with someone you have known this long and the trust is there then it should be an easier ride. I know I have been bought on board for the simple reason I understand production line processes and know how to make this work without having to even think about this. I turned a 200 a day bicycle assembly plant into a 3000 a day plant so 2400 items to be filled and packed by machinery is really basic.
