Internal Code: 1HABD
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Grey’s Point Business Solutions Pty Ltd (GPBS) is a warehouse business located in the southern suburbs of Sydney. The business was started by two friends in the late 1950’s but is now run by Carol Smith and Jacob Robinson who purchased the business in 1995. Carol and Jacob each own 30% of the issued ordinary shares in the company but several other family members also own shares and the company is expected to perform well and pay
annual dividends. The company’s Board of Directors consists of Carol, who is Managing Director, Jacob, Dave Smith and Maria Robinson who is the company secretary. There is one independent director and he is Lei Tran a family friend and the family tax accountant. Maria works in the business as the Accountant/Office Manager and has recently completed an MBA at UTS.
The warehouse business has been through some turbulent times in recent years mainly due to the increasing dominance of the larger Australia wide companies. GPBS has survived and managed to remain profitable through the changes in the industry and is now associated with a large relocation company which has ensured a steady amount of new clients. On top of this they have built up a good reputation for clean and spacious warehouse facilities with good security.
The company operates from premises that it has owned since the business was incorporated. At the time of incorporation two adjoining blocks of land were purchased with the warehouse and office on one block and the other remains undeveloped. During the years the buildings have been renovated and updated several times with the last occasion being only eighteen months ago. The other block is still vacant, not very securely fenced and has to be maintained by one of the local lawn mowing contractors to keep the grass and shrubs tidy. This maintenance currently costs $16,000 p.a. and is expected to remain at that level for the next three years when it is likely to increase by 3% p.a. for the next two years.
This expense will be eliminated if the site is developed. For some time now Carol has been advocating selling the land as it would release a significant amount of money which could be paid out to shareholders as a special dividend. However Jacob has always had a dream that the land would be used to expand the business and is not keen to sell. The company is working at full capacity and it is not unusual to have to turn away some potential customers.The company has mostly small sized spaces in the warehouse which are usually used by families for short or long term furniture storage. The company has had some requests recently for larger spaces for businesses to store goods between purchase and sale.