Our client, established in 1996 and based in the West Midlands, is a tachograph service centre. They offer tachograph testing, calibrations, repairs and installations and a tachograph analysis service. They also help clients comply with their legal obligation to download data from driver cards and vehicle units.

Their unique selling point is a “while-you-wait” same-day service in contrast to competitors where customers need to book in advance. In order to provide same-day service, our client has a significant inventory of spare parts and replacement units.

Activities

Our client offers tachograph download and storage, tachograph centre services such as testing, calibrations, repairs, and installations, and tachograph analysis. Its customers are businesses and public sector organisations operating a wide range of commercial vehicles including trucks, coaches, vans and limousines.

Our client offers the four following services:

• Tachograph Centre Services from testing and calibration to repair and installation.

• Tachograph Analysis provides customers with reassurance that their use of tachographs is compliant with current legislation and that their records meet the necessary criteria for a DVSA inspection. Analysis can be provided on a one-off basis or on a recurring 3, 6, or 12 monthly basis.

• Tachograph Download and Storage, a monthly service where customers download driver cards and vehicle units and the digital tachograph data is then securely stored (this is a legal requirement). Our client then provides customers with a certificate of download.

• Garage Services which accounting for around 15% of current turnover, our client also offers vehicle maintenance, servicing and inspections for clients.

The company’s catchment area is within 10-15 miles of its location. It has a database of over 1,000 customers primarily consisting of decision makers and managers within businesses operating commercial vehicle fleets. It has built up a healthy referral network with local garages as well which brings in more business.

Financial performance and marketplace

Our client’s financial performance in the past three years is impressive. They have generated a consistent 70%+ gross and 20%+ adjusted net profit margin during the period. 2022 turnover was £436,000.

There are 5,483,319 vans, trucks, buses and coaches were recorded in operation at the end of 2021, a 4.1% increase on the previous year. HGVs number 604,305 units. The number of buses on UK roads also increased. This is part of a historic trend of increasing reliance on commercial vehicles primarily driven by the demand for home delivery and multi-point dropping.

Employees and management structure

There are two directors in the company, one acting as managing director/centre manager and the other as financial director. Although they are ultimately responsible for all strategic and financial decisions made by the company, they consult with employees before making a decision in some cases.

The company operates what is essentially a flat hierarchy where the judgement of all staff members is given a high level of trust. Upon handover of the business, the centre manager role could be transferred to an existing member of staff however this would require around 2 months’ lead time for them to achieve the necessary knowledge.

In addition to the directors, there are:

• Tacho fitter and repairs (full-time) (15 years)
• Mechanic (3-4 days) (4-5 years)
• Part-time tacho analyst (3 days) (7-8 years)

The company headcount has been five in total for a number of years.

Land and assets

Our client rents premises on a 2-year rolling contract. There are three main buildings – an office space, a workshop of 4,000ft2 containing a 3-bay workshop, 2 rolling roads, repair bay, headlamp aligner and Portakabin where tachograph work is carried out, and a workshop of 2,000ft2 currently rented out to a third-party as a stock storage area.

There is an outdoor compound of 8,000ft2 which is currently sub-let piecemeal to various businesses generating £1,000 income per month.

In summary

Our client has a 27-year track record of providing comprehensive and specialized services to commercial vehicle operators. The company’s unique “while-you-wait” services is a distinct competitive advantage that, when combined with the quality of their work, has ensured year after year of high gross and adjusted net profitability.

70-80% of business is from repeat customers. A new owner could immediately expand capacity and/or increase the range of services offered by using the 2,000ft2 workshop currently used by a fashion retailer. Cash flow management is second to none meaning that initiatives to grow the business may not need the introduction of additional funding.

To discuss this company and to arrange a meeting with its owners, please call 0800 634 9679 or email info@swancorporatebrokers.co.uk.