There are some ownerdrivers
The company was started years as Veruram Fuel cc, by Ebrahim Badat, who is still Nonkes CEO. He bought the tanker with R50 which he borrowed from family and friends. Landing big contract with Total opened many doors.
Human nature dictated that an oil company would be somewhat wary of entrusting largescale distribution to privatelyowned company based in small town in KZN, says Ebrahim. Gross profit is between R50 and R120 year, depending on the size of the vehicle. This involves tendering directly for contract, for example, with parastatal like Eskom or government department. More recently, we have been awarded contract by Shell SA for the transshipment of fuel from Island View Terminal in Durban to various depots. Subjects include tendering, types of finance, financial management, what sort of business to register, as well as technical and operational information.
Nonke could then apply for bank loan and could buy new tankers at about R1. 8million each. I started by buying fuel from oil companies and then selling to various customers, he says, adding that customers included private transport operators, shops and farmers. Another way into the industry, particularly for smallernewer entrants is through subcontracting. Have you done routeplanning feasibility exercise? Subcontracting occurs when transporter contracts to third party and not to the principal.
Could you run transport business? Ask yourself these questions Can you afford maintenance plan? This meant that we had to work very hard to gain the confidence of the management of the various oil companies.While some companies might argue that capital expenditure is the significant investment, Ebrahim disagrees. Do you know what type of vehicle combination you will use? Do you have an understanding of the variable and fixed costs in transport? Gross profit is between R50 and R120 year, depending on the size of the vehicle.
Do you have an understanding of the variable and fixed costs in transport? It also happens that transport brokers tender for work, secure contracts and then outsource the job. Nonke could then apply for bank loan and could buy new tankers at about R1. 8million each. employ business manager or adviser. How many vehicles will you need? Before that, its biggest challenge had always been to break the barriers of entry into an industry dominated by large companies, challenge which smaller new entrants still face. Landing big contract with Total opened many doors.
