first visit 2012. background concept sub franchise system marketing staffing assortment &...

FIRST VISIT 2012FIRST VISIT 2012

BackgroundBackground ConceptConcept

Sub franchise Sub franchise SystemSystem MarketingMarketing StaffingStaffing

AssortmentAssortment& Purchasing& Purchasing

SoftwareSoftware

ContractorsContractorsPreparation Preparation Next visitNext visit

ContentContent

Sub Sub franchisingfranchising

Global presence – 27 countriesGlobal presence – 27 countrieson 5 continentson 5 continents

Jordan

Bulgaria

Azerbaijan

Greece

Iceland

Ireland

Indonesia

Lithuania

Libya Philippines

Poland

Mexico

Serbia

Saint Maarten

Slovakia

Slovenia

Turkey

VenezuelaCzech Republic

France

Germany

Northern Cyprus

BackgroundBackground

Global Global Presence!Presence!

US company Florida based:

• 1989 Launched in Spain• 1993 Europe expansion• 1997 Middle East• 2000 Caribbean• 2004 Asia• 2005 China Export Office• 2008 Expansion in Latin America• 2010 E-Commerce expansion

27 COUNTRIES27 COUNTRIESEUROPE: EUROPE: 1313

ASIA: ASIA: 4 4

MIDDLE EAST/AFRICA: MIDDLE EAST/AFRICA: 4 4

LATIN AMERICA:LATIN AMERICA: 3 3

NORTH AMERICA: 1NORTH AMERICA: 1

CARIBBEAN:CARIBBEAN: 22

UPDATE

EUROPE 13:

Bulgaria - France - Greece - Iceland – Ireland- Italy - Lithuania - Poland - Romania – Serbia-Slovakia-Slovenia-Turkey

UPDATE

ASIA 4

Azerbaijan China Indonesia Philippines

UPDATE

LATIN AMERICA- CARIBBEAN 5

Mexico – Peru – VenezuelaTrinidad – St Martin

UPDATE

MIDDLE EAST – AFRICA 4

Jordan – Qatar Libya – Sudan

Only Global Only Global Franchise!Franchise!

Best Umbrella Best Umbrella Trademark!Trademark!

China Buying Office!China Buying Office!

2008 US OFFICE PRODUCTS MARKET•Economy in recession since third quarter ‘08• Total Market $ 162 Billion – flat or slight decline• Retail superstores particularly affected• Large dealers increasing market share

• Office Supplies: down 6% now only 27% of mix• IT consumables: up 4% now 42% of mix• Furniture: down 4% • Facilities/Coffee (FM) 15-20% of mix and growing

Industry Trends

$ Billion Mix % Growth %

Office Supplies 46 28 - 6

IT Consumables

71 44 + 4

Office Furniture

18 11 - 4

FM Supplies 27 17 + 4

TOTAL 162 100 0

US MARKET 2008

Industry Trends

Billion Pounds Mix % Growth %

Office Supplies 1.75 22 - 6.0

Office Furniture 0.80 10 - 9.0

IT Consumables 3.0 37 0

Visual Presentation 0.5 6 0

FM Supplies 2.0 25 +12.0

TOTAL 8.05 100 - 5.2

UK MARKET 2008

Industry Trends

CHANNEL LANDSCAPE UK %

• Contract Stationers 13 Steady• Independents 48 Strong• Retail/Superstores 11 Down• Mail Order – Office FM 15 Down•Computer Resellers 8 Down• Direct Mail 5 Down

Industry Trends

Big Box/Power Players phenomenon over:

• Power shifting to 300+ large US & UK dealers $50mm+• Customer intimacy allied to Logistics Suppliers

• Advantage for franchise model• Declines in average order and customer traffic• Weakness in office machines and accessories

Industry Trends

Retail superstores in decline:• Large soulless stores are down, down and out• Private brand at 30% of total makes stores dull•Women customers have no time for store visits•E. commerce big winner

Amazon entry• Office Depot and Max closing stores in US (ODP 200 closed)• OfficeMax experimenting with mini stores and Kinko’s like services•Competition from other chains

Wal-Mart, Tesco

Industry Trends

• Gross margins decline by 5.4% points from 33.7% down to 28.3% due to IT (however generates higher value sales).• Fastest growing market is small and mid-size companies (50-500 employees.) • Account for 65% of total market.

Industry Trends

OF, IT and FM GREATEST POTENTIAL.

OF - Office Furniture:

• Large Dealers employ a specialist in office interiors (OIS). • Best potential for sales: Reception and Training room.• The move to full service interiors service is inexorable.• Huge shift towards lighter and brighter furniture away from the dull and dark look• Take advantage of OFFICE 1 China Export

Industry Trends

IT Consumables:

• Fastest growing category should = 35-40% of sales. • Many OFFICE 1 masters at 20% on average.

• Fear of technology• Deterrent of low margins

• Fast growing laser printers because of color• Recession will affect growth of recyclables and

remanufactured. (17 -24% of total consumables according to Lyra research)

• Focus on MVC (most valuable clients) and your share of their IT buys?

Industry Trends

FM: Facilities Management Supplies fastest growth: • Market in US $25 Billion and in UK $4 Bn. Exact numbers not clear.• Hygiene , janitorial, sanitary, cleaning, health and safety, maintenance, repairs and security supplies• Refreshment and catering supplies• OP has advantage with:

• 24 hours delivery•One stop shop•Free delivery•Fragmented competition•On line ordering and catalog/telemarketing•Natural Coffees experience. Espresso. In some countries key seller.

Industry Trends

E. Everything:Ecommerce: 7 out of 10 top websites sell OP

80% of small dealers do not have a web store and 90% ask for passwords

E.marketing:• Replacing printed flyers in effectiveness and reach• Best to advise customers and personalize appeal. • Avoid looking like Spam• Low cost medium• Best time to mail: Monday and Tuesday and 11.30 am- 3.00PM also 4.30PM• Use of video demonstration 30 seconds. (70% of women view)

Industry Trends

• E. Everything: (Continued)

– Ecommerce sales accelerating with emergence of broadband:

Company size Employees E. Sales as % of total

delivered

Large 500+ 50 - 75

Medium 100 - 500 30-50

Small 5 - 30 15 - 25

Industry Trends

WOMEN RULE THE OFFICE:

• Focus on saving her time• 65% of women love to shop on line and love Amazon• 40% shop on line after 8PM• Best Target is: 28-45 years of age

Not secretaries only but Executive Alpha Female•Feminize marketing process:

Effect on products, colors, catalogs, advertisingIntimacy is in. Call centers are out.Sell her coffee and FMPersonalized email promotionsTelemarketing: Must gather information on behavior, authority, likes and dislikesBuild one to one relationships

Industry Trends

WOMEN RULE THE OFFICE: (Cont.)

• 84% of office buyers are women• 75 % of women think catalogs are boring• 66% prefer matt to shiny pages• 87% prefer quality brands• 70% prefer to order on line• 67% think telephone too slow to respond• 41% of small businesses are owned by women

Source: DDB Worldwide Trendsights

Industry Trends

• PRIVATE BRANDS PRESSURE MANUFACTURERS:

Office Depot 27% of salesLyreco 30%Corporate Express 27%Staples 35%Spicers 20%Saturation level: 40%

• Effect on commoditization of store and catalogs

Industry Trends

-Large discount houses expanding stationery section.

Wal-Mart, Carrefour, Metro

- Effect of computer on sales to students and consumers.

- Decline in sales of “classic” Stationery Products: Paper clips, folders, lever arch files etc…

Industry Trends

BackgrounBackgroundd

GROWTH OF B TO B SEGMENT:

- Contract dealers expanding:

Lyreco, Corporate Express

- Big Retail Chains entering markets through contract dealers and ecommerce:

Office Depot, Staples

Industry Trends

IMPORTANCE OF BRAND NAME:

• Create synergy and point of difference• Improved margins through OEM• Uniformity of look on shelves• Facilitate consumers’ pull of products• Stores are a form of advertising

• The more stores, the more advertising• Stores represent 20% of total sales yet help contract sales: Without 20% cannot sell and deliver 80%

BackgrounBackgroundd

Industry Trends

MARKET TRENDS 100% POSITIVE FOR OFFICE 1

• OFFICE 1 concept extremely timelySmall stores near customersMulti channel approach + ECommerce

• OFFICE 1 viewed as a solution for small dealersEffect on conversions of stationers and dealers to OFFICE 1

• Franchising creates personalized service• Private brand products very helpful

HOW IS AFFECTED?

• All Office Needs Under One Roof:

Stationery-Business Machines-Furniture-Services

• Multi-Channel DistributionRetailWholesaleTelemarketingDirect MailContract SalesE-commerce

• All Office Needs Under One Roof:

Stationery-Business Machines-Furniture-Services

• Multi-Channel DistributionRetailWholesaleTelemarketingDirect MailContract SalesE-commerce

OFFICE 1 OFFICE 1 ConceptConcept

ConceptConcept

• No other global franchise

• Advantage of store mix: Large and SmallLARGE: Image - Flagship - AssortmentSMALL: Rents - Downtown Location

• Global LinksSourcing - Multinational purchasing power

• No other global franchise

• Advantage of store mix: Large and SmallLARGE: Image - Flagship - AssortmentSMALL: Rents - Downtown Location

• Global LinksSourcing - Multinational purchasing power

Why is OFFICE 1 Why is OFFICE 1 Unique?Unique?

ConceptConcept

TRAINING TOPIC:

1. SUB-FRANCHISE SYSTEM

Sub Franchising SystemSub Franchising System

• Exclusive territory: 2500 companies• Rights to OFFICE 1 trademark in

territory• Rights to OFFICE 1 system• Training• Purchasing and promotional assistance• Treated as partner and equal

• Exclusive territory: 2500 companies• Rights to OFFICE 1 trademark in

territory• Rights to OFFICE 1 system• Training• Purchasing and promotional assistance• Treated as partner and equal

Rights of sub franchiseesRights of sub franchisees

•An initial fee•On-going royalties

OFFICE 1 OFFERS THESE RIGHTS AGAINST:

Rights of Sub franchiseesRights of Sub franchisees(Continued)(Continued)

• 50 m2 City center• 150 m2 Suburbs and Small

Towns• 200 m2 Small warehouse

in industrial area• 350 m2 Regional

Superstore

• 50 m2 City center• 150 m2 Suburbs and Small

Towns• 200 m2 Small warehouse

in industrial area• 350 m2 Regional

Superstore

OFFICE 1 Franchise ModelOFFICE 1 Franchise Model

Small, attractive, modern 50 m2•Retail and telemarketing sales•1,000-1,500 SKUs in store•High pedestrian areas•Telemarketing - Logistic Supplier

delivers orders•Exclusive territory city blocks

Small, attractive, modern 50 m2•Retail and telemarketing sales•1,000-1,500 SKUs in store•High pedestrian areas•Telemarketing - Logistic Supplier

delivers orders•Exclusive territory city blocks

OFFICE 1 Franchise OFFICE 1 Franchise ModelModel

TARGETTARGET

• New entrants

• Existing stationers and Service centers

• Existing dealers who want to be in retail or use

OFFICE 1 as logistics supplier

• New entrants to OP market

• Delegates, Ecommerce franchises, store in store

FRANCHISE FOCUSFRANCHISE FOCUS

Many modern, attractive 50 Sq.m stores

• Retail and telemarketing• 1,000-1,500 SKUs in store• 4000 SKUs through logistic partner• Highly visible pedestrian and traffic

locations• Owner + 1 or 2 Employees

CASHIER TELEMARKETING

Franchise Organization 50 Franchise Organization 50 m2m2

70 m270 m2

StoresStores!!

250 m2

StoresStores!!

200 m2

StoresStores!!

70 m270 m2

StoresStores!!

90 m290 m2

Store in Stores!Store in Stores!

Store in Store in Stores!Stores!

AssortmentAssortment

OPTION 1

• Master FranchiseeBuys Branded products+ OFFICE 1 imports and

delivers to franchisees

• Franchisee delivers to customers

OPTION 1

• Master FranchiseeBuys Branded products+ OFFICE 1 imports and

delivers to franchisees

• Franchisee delivers to customers

OFFICE 1 OFFICE 1 LogisticsLogistics

OPTION 2

• Master Franchiseebuys Branded products+ OFFICE 1 imports

• Logistic Supplier distributes to franchisees and customers

OPTION 2

• Master Franchiseebuys Branded products+ OFFICE 1 imports

• Logistic Supplier distributes to franchisees and customers

Delivery fromMaster Franchisee

to retail stores

Delivery fromMaster Franchisee

to retail stores

24 Hours Delivery24 Hours Delivery

OPTION 1

ClientClient

Traditional

SystemTraditional

System Traditio

SystemTraditional

System

OFFICE 1 LogisticsOFFICE 1 Logistics(Continued)(Continued)

OPTION 2

Logistics Supplier

ADVANTAGESSTOCKLESS FRANCHISING:

Logistic Partner delivers to customers: • Lower stock• Small store space = lower rent + better

location• Focus on selling not delivering

TRAINING TOPICS

2. MARKETING

Marketing

• STORE CRITERIA AND LOOK• TARGET MARKET• OBJECTIVES AND STRATEGIES• COMPETITION• GROSS MARGIN AND PRICING• PROMOTION PLAN 2011

Topics

• High concentration of offices• High pedestrian traffic most hours daily• 100m2 Size• Parking - Visibility - Access - High Traffic• Rectangular - High Ceilings - Glass Façade• Near Schools or University• High Income and population 100,000 Also:

Stores outside cities in periphery

Sole Store in small town

Sole Store in manufacturing park

• High concentration of offices• High pedestrian traffic most hours daily• 100m2 Size• Parking - Visibility - Access - High Traffic• Rectangular - High Ceilings - Glass Façade• Near Schools or University• High Income and population 100,000 Also:

Stores outside cities in periphery

Sole Store in small town

Sole Store in manufacturing park

Ideal Site Ideal Site CriteriaCriteria

Marketing

Attractive eye catchingdesign of shelves and signs:

Fixtures Signs Drawings Text Specifications Budget Operations Manual

Attractive eye catchingdesign of shelves and signs:

Fixtures Signs Drawings Text Specifications Budget Operations Manual

OFFICE 1 Store OFFICE 1 Store LookLook

Marketing

Target Market

• Focus on companies

- Small to medium

- Large companies when becomes leader

• Professionals

• Multinationals

• Students and consumers

• Sometimes schools

Marketing

Competition

• Small stationers

• Dealers

• Discount Chains

• All re-sellers directed to small companies

• Direct mail houses

Marketing

Pricing

• Set prices for sub franchisees High enough to make a living

(30% gross margin is needed/ target 35%)

• Set top 100 Items at low prices• Main Assortment higher priced • Set store retail prices highest• Imported items: low prices – high margins• Professional and hobbies at high prices

Marketing

Promotion Plans

• Mix of catalog, brochures and flyers

• The objective is one piece mailed every

month except August.

• One catalog a year

• Three brochures: January, April, October

• Eight themed flyers:

OFFICE 1 branded Machines

Back to School Christmas Gifts

Furniture

Marketing

Brochure Preparation

• Develop mission statements• Develop brochure theme and colors• Compose Slogans and GM’s Message• Compose One Liners At Bottom of Page• Decide quantities and whether to charge franchisees• Keep Number of Pages controlled and Number of SKUs Below 1500.

Marketing

Gross margin between 26% - 30% depending on mix and country.

Sales percentages:Furniture: 15% Stationery: 47%Machines: 15% Toners/Cartridges 20%

Copy Center: 3%

Typical Expenses:Rent: 5% Overhead: 4% Direct Labor 8%Amortization 2% five years. Promotion 1%

Gross margin between 26% - 30% depending on mix and country.

Sales percentages:Furniture: 15% Stationery: 47%Machines: 15% Toners/Cartridges 20%

Copy Center: 3%

Typical Expenses:Rent: 5% Overhead: 4% Direct Labor 8%Amortization 2% five years. Promotion 1%

OFFICE 1 OFFICE 1 StatisticsStatistics

Marketing

TRAINING TOPICS

3. STAFFING AND ORGANIZATION

Recruitment Schedule

Staffing and Organization

• Upon Signing Master Agreement:

• General Manager• Systems Manager• Accounting• Marketing Manager• Merchandising Manager

Table of Organization

GENERAL MANAGER

ACCOUNTING /HUMAN RESOURCES

SALES /TELEMARKETING

MISITMERCHANDISE

MANAGER /BUYER

FRANCHISE MANAGER

MARKETINGDTP

STORE OPERATIONS

REGION

REGION REGION

Staffing and Organization

TRAINING TOPICS

4. PRODUCT ASSORTMENT AND PURCHASING

Research and Policy decisions

Product and Purchasing

• Study Competitive Prices 100 top items

• OFFICE 1 recommended assortment

• Your own assortment

• China warehouse assortment

• OFFICE 1 Central Warehouse Assortment

• Local retail assortment

•Decide total SKUs in brochure and in store

Product assortment and SKUs

• 4000 SKUs in catalog

• 1,000-1,500 at retail based on size

• Include furniture and machines

• Low price OEM imports from China (20% of sales)

• Two Brands/Price levels per category

• 500 SKUs = 80% of sales

Product assortment and SKUs(Continued)

• Categories as percent of sales:

- Paper & Toners: 40% of sales at 15.0% GM- Furniture: 10.0% at 35%- Machines: 10% at 15%- Stationery: 45% at 47.5%- Average GM: 32% ???

Of the above products 20% minimum should be OEM whether local or from China

Sourcing options

• Logistic supplier

• Local

• Imported from China

• OFFICE 1 European Warehouse

• Local Manufacturers and Distributors

• Keep under 60 vendors

TRAINING TOPICS

5. System software

System Software

Questions to consider

• Adopt own software and tools?

• Adopt Local software provider?

• Adopt mix?

• Supporting Sub franchise Requirements.

• Decide Hardware/Network/Communications

• Establish Logistics and Flow Processes

System agenda 1st visit

• Survey Company Requirements.

• Assign Staff for MISIT.

• Survey local tax needs

• Build Organization in System.

• Configure screens, and formats.

System Software

System agenda 1st visit

(Continued)

• Accounting and statistics

• Required information by department

• Procedures for processing returns and credits

• Product codes

• Start data entry

• List of reports needed

System Software

System schedule of activities

60 Days:• Continue Data Entry all applications• Train all positions all applications.• Configure statistic formats.• Establish coding and text disciplines.• Enter vendors, items, and orders in data base, including OFFICE 1 Central Warehouse• Order forms, labels, and configure; test print.

90 Days:•Enter Customer Database.•All information in System; Developing reporting.

System Software

Software applications

• Retail Sales both B2B and B2C By Ticket/Invoice; Customer/item; Tax inc.?

Software • Vendors and Orders• Items and Inventory• Customers and Orders• Accounting• Financial data of company

System Software

6. Contractors and Agents

TRAINING SECTION

Contractors

• Locate Contractors and Agents

• Fixture: Steel Multifunctional, Laminate Counter and Glass Showcases.

• Signing: Steel, Compressed Board, Vinyl.

• Printers: Forms, Shopping bags.

• Security, Delivery.

• Handyman contractor for store remodeling.

What to look for and do

TRAINING TOPIC

7. Introduction to Sub-franchising

Sub-franchising

•What is Sub franchising?

Franchise and Sub franchiseRights of Sub franchisees

•Responsibilities of Master franchisee:

1. Why is OFFICE 1 attractive to Subs? 2. Why are Subs attractive to Master?3. What is typical profile of successful Subs?

Sub franchise training

5. How does Sub franchising work?

6. How many types of Sub franchises?

7. Staff needed in Sub franchise?

8. How to attract Subs?

9. Territory definition?

Sub franchise training(Continued)

Sub-franchising

11. Printed pieces to develop:

• Introductory folder• Application form• Sub franchise contract• Confidentiality agreement• Training manual• Margin analysis/Initial order

Sub-franchising

12. Training program

13. Answers to most often asked questions

14. Royalties report

Sub-franchising

System whereby Sub franchises have certain rights:

TrademarkTraining and retail store set up assistanceTerritoryBuying CooperativelyBrochuresSystem Software

What is Sub franchising?

Sub-franchising

Responsibilities of Master Franchisee:

TrainIT and Web CommerceMerchandise at low priceBrochuresManuals Guidance

What is Sub franchising?

(continued)

Sub-franchising

• Synergy of common trademark• Exclusive territory and easier exit strategy• Risk reduction in joining a group• Global experience and local support• Assortment includes OFFICE 1 and low priced

imports• Buying power to improve as we get larger• Catalogs and promotional aids• Active telemarketing system and training• Software

Why is OFFICE 1 attractive to Subs?

Sub-franchising

Why is Sub franchising attractive to masters?

• Buying power

• Influence and synergy

• Visible Trademark

• Stream of income

• Quick Ramp Up

• Franchising Potential

Sub-franchising

What is typical profile of new Subs?

• Stationery store owners

• Owners of small stores

• Entrepreneurs business to business

• Recent college graduate

• Dismissed executives

Sub-franchising

• Country divided into territories• Sub franchises with multiple stores• Sub franchise Agreement• Decisions:

Gross marginInitial feeRoyaltiesRate of sign upsConverts and new

How does franchising work?How does franchising work?

Sub-franchising

How does franchising work?How does franchising work?(Continued)(Continued)

• Architecture and fixtures

• Store layout design

• Training and manuals

• On going support

Sub-franchising

HOW MANY TYPES OF SUB-HOW MANY TYPES OF SUB-FRANCHISES?FRANCHISES?

Several Types:•Typical 100m2 to 200m2•Small cash register only 50m2•Warehouse type•Large superstore 350m2+

Decisions: •Prioritizing•SKUs•Gross Margin•Royalties•Speed of ramp up

Sub-franchising

Type m2 #Firms Initial Fee US $ Staff

Typical 150 2,500 20,000 5

Small 50 1,000 10,000 1 or 2

Warehouse 300 500 20,000 5

Large 500 10,000 50,000 12

Guidelines

Sub-franchising

Staff needed

TYPICAL:

OwnerCashier/copy centerDelivery/Stock boyTelemarketingSales clerk/Copy Center

Sub-franchising

STAFF NEEDEDSTAFF NEEDED(Continued)(Continued)

SMALL STORE or KIOSK:Owner

Telemarketer Part Timer

MEDIUM STORE:Owner

TelemarketerCashier/copy center

Sales clerk/Copy Center

Sub-franchising

LARGE STORE:Store ManagerOperationsCashier (s)Sales Associates, (electronics / furniture)JanitorCopy centerTelemarketing

Sub-franchising

WAREHOUSE FRANCHISE or DEALER FRANCHISE:OwnerCashier/copy centerDelivery/Stock boyTelemarketingSales clerk/Copy CenterOutside salesperson

E-FRANCHISEE: Owner + Telemarketer

Sub-franchising

HOW TO ATTRACTHOW TO ATTRACT SUB-FRANCHISEES?SUB-FRANCHISEES?

• Professional recruiters• Brochure mentions• Word of mouth• Mailings• Outside agency• Franchise Fairs and OP Fairs• Advertising

Sub-franchising

Territory # Firms Professionals Total %

A 3215 31 3246 20

B 2875 97 2972 18

C 1987 231 2218 14

D 7532 127 7659 48

Total 15,609 486 16,095 100

Territory Definition

Sub-franchising

Postal code

Retailers Professionals

Firms Total

28003 124 16 1500 1640

28008 432 15 1715 2162

Total 556 31 3215 3802

Territory A

Territory Definition

(Continued)

Sub-franchising

Regional Developer

Acts as Master for a large province or region

•Converts its own stores•Recruits Sub-franchisees•Negotiates Subs contracts for Master to sign •Trains Sub-franchisees•Provides brochures•Manuals and training

Sub-franchising

Regional Developer

(Continued)

Remuneration:

Keeps 50% of Sub franchise initial feeKeeps 50% of Sub franchise royalties

(Note: Usually invoices Sub franchisee and forwards portion to Master upon receipt of payment)

Sub-franchising

Printed pieces to develop

Sub franchise introductory folder

• Four color introductory piece• Background master and OFFICE 1• Contains listing of territories• Describes conditions of franchise• Investment insert• Application form• OFFICE 1 brochure

Sub-franchising

Printed pieces to develop

(Continued)

Investment Insert:

• Type of Sub-franchise• Territory description• Staff needed• Duration of contract• Initial fee• Royalties• Product sourcing and assortment• Estimated investment and projected cash flow

Sub-franchising

Year 1 Year 2 Year 3 Year 4

Sales 100 135 150 165

Margin 30% 32 33 34

Salaries

Rental

Projected figures typical sub

Sub-franchising

Printed pieces to develop (Continued)

• Sub franchise ContractShort version

• Application FormOne formal and a simpler one to use at fairs

• Confidentiality Agreement To include in contract or as extra

Sub-franchising

Printed pieces to develop (Continued)

Sub franchise Training Manual

Adapt OFFICE 1’s initial order

Introductory order should reflect latest brochure.

(Note: OFFICE 1 will provide initial order but it eventually may have to vary with each new brochure)

Sub-franchising

Training program

All training is on the job

•In Sub franchisee store •In master’s superstore

Day 1General meeting with entire staffTour superstoreIntroduction to system

Day 2Cash register etc.(Note: Typical training program is listed in OFFICE 1 Manual)

Sub-franchising

Answers to questions

• What does initial fee cover?• What is it based on?• Can I pay over time?• Can I open more than one store in territory?• Must I do telemarketing?• What is my investment?• What will my sales be?

Sub-franchising

Answers to questions(Continued)

• Must I sell product listed in brochure?• Can I change prices?• Can I break open boxes?• Can I sell items outside of the range?• Can I do telemarketing in another territory?• Can I sell in someone else’s territory?

Sub-franchising

Royalties Report

Company stores sales: _________Company stores royalty:________Initial fees sub-franchises:

Store 1Store 2

Royalties sub-franchises:Store 1Store 2

Total royalties OFFICE 1:Less taxes:Net Royalties OFFICE 1:

Sub-franchising

TRAINING TOPICS

8. PREPARATION NEXT VISIT

Next Visit

• Locate fixture and sign manufacturers(Get samples and quotes and schedule meetings)

• Select printer for forms• Select handy man contractor• Select equipment and vehicles• Shopping bag manufacturer• Service suppliers:

(Business center machines, stamps, etc.)

Contractors and agents

Next Visit

• Qualified programmer with web capabilities on staff•Purchase hardware work stations for all staff•Prepare website templates for both corporate and e-commerce websites•Decide on local software and install•Provide specifics to OFFICE 1 International so they can assist with bridging templates •Set up and register domains•Decide and install network and configure all peripherals

Next visit

• Map out number of firms by postal codes nationally and develop list of territories in country• Develop recruiting material• Develop Sub franchisee training manual (Use OFFICE 1 as guide)

• Finalize Sub franchising contract• Recruit store setup team for Sub franchisees• Local software decision

Franchising

Next visit

Competition

Review key players:

• Payment terms• Pricing• Assortment B to B• Assortment retail• Number of stores and locations• Get copies of catalogs if any• Any weakness?• What is positioning and strategies

Next visit

Marketing

•Decide price strategy

•Order all printed forms (follow OFFICE 1 manual)

•Promotion plan twelve months:

Introductory flyerFirst brochureOther flyers

Next visit

Retail

•Review text of signage and adapt for local needs•Select shopping bag manufacturer and check if can get a vendor to pay for its name on bags. (HP)•Define store mission statements towards customers:

Refund and delivery policiesHow to order in brochureStore hours. Standard or by location?

•Decide store assortment•Decide business services to offer in store.

Next visit

Assortment

•Determine 100 best sellers

•Recommended initial assortment for new store

(To be prepared by OFFICE 1 based on Master’s catalog)

•Recommended assortment for catalog/brochures

•Imported assortment from OFFICE 1 CW(To be prepared by OFFICE 1)

Thank you for your attention!

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