Location: Midrand, Gauteng
Jessey's Catering is an established close corporation that was registered in 2007, and provides the end-user with a variety of foods prepared for different occasions in various quantities – this includes managing canteens for different corporate clients whilst maintaining a very high standard of fresh, quality foods at an affordable price.
Since inception, Lucy Mbizi – the owner of Jessey's Catering – has encountered numerous problems relating to cash flow and lack of brand visibility. The client's premises are in a business park where there is limited visibility leaving the business with a high need for extra marketing efforts, in addition to this rental costs are too high for their operations, and the availability of funds to secure better premises also posed a challenge.
Manual food preparations had its own flaws resulting in a lack of consistency in quality and turnaround times. Other assets such as rented space were under-utilised, and wastage costs were high as the business deals with perishable products – this distressed its profit margins. Late-paying customers was also a major contributor to cash flow problems, which led to late and non-payment to creditors eventually hindering service delivery.
An assessment was conducted by Seda in order to propose recommendations and solutions to the challenges faced by the business. Through Seda's partnership with Productivity SA, a turnaround strategy was implemented and negotiations with creditors began. The strategy also included marketing activities such as exhitions that would help with lead generation to increase client base thus improving cash flow. Furthermore the business was advised to set up a marketing team that would focus on securing long-term contracts. This landed the business a three year catering contract with the Pearson Institute's three campuses.
Following intervention, the businesses turnover improved from R4.7million to R8.5million and 24 new jobs were created bringing the staff complement to 50.