When Anthea Hartzenberg tells me she plans to franchise her recycling business in the not too distant future, I don’t doubt her for a second.
That’s because Hartzenberg has managed to pull her business back from the brink of bankruptcy to doubling her customer base – all in the space of one month. This, in the startup phase when experts reckon some 80% of small businesses are destined to fail.
Hartzenberg first started her business Recycle 1st in 2009 while still employed in the banking sector.
Unhappy with her job, she was introduced to recycling by a friend who took her to a nearby business to show her how things are done.
“I became interested in what they were doing. I started doing research. I wanted to know how money was made from recycling,” says Hartzenberg.
With the help of her father she started collecting recycling from households during the evenings using her Toyota Tazz.
After she was retrenched in 2010 she decided to work in the business full time.
“I traded in the Tazz for a Bantam bakkie and in my first year my turnover was about R27 000,” says Hartzenberg.
In the third year the business grew even more and she was approached by another business owner who also owned a recycling business and wanted to embark on a joint venture.
Despite not having put much in writing apart from the joint venture agreement, Hartzenberg rented business premises and borrowed money to further the business.
“I was so excited to do something new and operate from a factory that I did not see all the warning signs. The other business owner did not contribute anything,” says Hartzenberg.
Within two months she began to realise that the joint venture was not working and that there was a serious cash-flow shortage.
She managed to dissolve the joint venture agreement and was able to get out of the factory rental lease thanks to an understanding landlord.
“I lost R20 000 which was a lot to me at the time and I also had to let go of my two employees,” says Hartzenberg.
However, that same month she met another business owner who was also involved in recycling and who wanted to close down his business and sell her his customer base. This time Hartzenberg made sure to cover all her bases. She called up customers as references to check whether he was really doing business with them and spoke to the business’s accountant.
“I bought the customer base and almost doubled my customer base because of it,” she says.
Reflecting on the past, Hartzenberg says she has managed to increase her turnover by almost 200%, successfully relocate her business premises to a factory in Epping and grow her staff to 14 employees.
“We also managed to acquire a new vehicle thanks to a grant of R50 000 from the Western Cape’s Enterprise Development Programme,” says Hartzenberg.
- Visit www.recycle1st.co.za for more information.