SOLD! Growing Plastic Recycling and Manufacturing Business – Melbourne

This is an established business with two complementary divisions that enable the business to take in industrial plastic waste, convert the collected plastic waste into recycled plastic pellets and use these pellets as input to manufacturing plastic products. The extruded plastic products are sold to a portfolio of regular customers across Australia.

The owner has an accounting and management background, and he is supported by a team of employees with engineering and production expertise. The factory operates 24/7 and has separate production areas with multiple production lines.

Business is not impacted by previous COVID trading restrictions as it is part of the essential services supply chain. All COVID related government grants and Jobkeeper payments are excluded from the calculation of profit/income.

Highlights :

• Sales of $3.4 to $3.5 million for FY 2020 and FY2021 with adjusted profit to owner in excess of $600,000 pa
• The owner spends between 15 to 20 hours a week in the business overseeing the financials and management of the business
• Two main sources of income are from selling the recycled plastic as granules or flakes, and from selling the high-quality plastic products
• Simple recycling operation only handles the recycling of industrial plastic waste where it collects from businesses around Melbourne
• Growing demand for plastic products, especially with the hygiene expectation by businesses and consumers to minimise contamination and spread of COVID
• Extensive plant and equipment that include pelletising lines, extrusion lines and granulators that will cost over $1 million to setup
• Current location has the permit to undertake the recycling of plastics, which is not easy to obtain
• Capacity to recycle plastic waste to meet the requirement of the Australian government’s new Waste Export License (New July 2021)

Training and support are provided to ensure a smooth transition. As a niche recycler of industrial plastic waste, the business is well-positioned to take advantage of the new rules for waste plastic exports, which started in July 2021. Under the new regulation, a license will be needed for all waste plastic exporters, and plastics for export will need to be sorted, further processed and free of contamination. The business is already operating at a level that meets the new regulation.

The business will be suitable for an owner/manager with a vision to take the existing business and continue its growth path, or as a “bolt-on” to an existing business seeking to grow the plastic recycling and manufacturing base.

The owner is ready to step back from the business and has priced to sell in the current market.

Asking $1.35 million-plus stock ($200,000)