GOLDWAGENFranchise Information

Franchise Information 2017

Goldwagen Franchise Overview 2

Highlights 2Objectives 2Mission Statement 2Keys to Success 3Company Ownership/Legal Entity 3Hours of Operation 3Products and Services 3Management 3

Goldwagen Franchise Setup Costs 4

Capital Outlay 4Finance 4The Franchise Agreement 4Retail/Building Space 4Delivery Cost 4Training 4

Computers 5

Franchise License Fee 5

Advertising 5

Table of Contents

Franchise Information 2017

Goldwagen Franchise OverviewThank you for your enquiry regarding our dynamic and exciting Franchise concept. With over 97 Goldwagen branches in operation, we know that we have a winning concept.

About GoldwagenEstablished in 1992, the company started in small premises situated in Souter Street, Pretoria West, Gauteng, South Africa. Since then Goldwagen has grown into a premier retailer boasting more than 97 outlets across South Africa and strategically located in several other countries.

The Group deals in an extensive range of products that are distributed to the Goldwagen outlets which in turn, retails to mechanical workshops, wholesale outlets, DIY enthusiasts, retailers, body repair shops and directly to the public.

Starting with the distribution of Volkswagen and Audi parts only, demand and opportunity quickly presented itself to rapidly broaden our value proposition to include Opel, BMW, Mercedes Benz,Toyota, Chevrolet, Renault, Ford, Mazda and Nissan to maintain a consistent supply of original quality parts. We control our own sourcing and shipping operations.

We also enjoy direct supplier agreements with most of the manufacturers we deal with. To deliver quality service and products we currently we have more than 300 proud employees that make a difference between a good and great company.

With over 30 000 SKU’s (Stock Keeping Units), Goldwagen remains the market leader.

HighlightsGoldwagen Franchise Partners benefit extensively from our premier brands and excellent reputation. For example, having access to exclusive and in-depth product knowledge that has been gathered over the years and presented in easy-to-use formats.

ObjectivesThe Goldwagen Vision is to retain its standing as the leading Automotive Parts Retailer offering its Franchisees and Customers the best quality products and affordable products.

Mission StatementThe Goldwagen Mission is to combine aggressive strategic marketing with quality products and services at competitive prices and the best value for consumers. To maintain our reputation in the market as being the premier provider of targeted specialized motor spares and products and related services throughout Southern Africa and selected alternative markets. Our aim at Goldwagen is for our brand to be synonymous with affordability, quality and world class service to our customers.

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Franchise Information 2017

Keys to SuccessGoldwagen has stores around the country even expanding beyond our borders. Find a store near to you to preview our amazing products and Franchise model.

Attributes of a successful Franchisee, amongst others,• Hands on and involved in the daily management of the business• Friendly and customer service orientated

Company Ownership/Legal EntityFranchisor: WAGWorldwide Automotive Group (Enterprises) (Pty) Ltd. (WAG) is a registered, privately owned company. The company has been in operation since 1992.

Hours of Operation• Office Hours: 08:00 – 17:00 Monday to Friday • Public Holidays: Closed • Weekend Trading: 08:00 – 13:00 (Saturdays, Sundays optional)

Products and ServicesGoldwagen has a substantial product range, with continuous research and development into new brands.

Some of our OE Quality Brands

Management MeetingsFranchise meetings are held on a regular basis, where items of a general nature and operations are discussed. It is recommended that all franchisees attend.

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Franchise Information 2017

Franchise Setup CostsIf you have capital of R 3 750 000.00 (VAT incl.) all the below mentioned setup costs should easily be covered, which would include initial minimum stock of approximately R 2 400 000.00 (VAT incl.) and R 1 350 000.00 (VAT incl.) for capital outlay, dependent on store size. We require that Franchisees have at least 50% unencumbered funds of the total franchise cost.

Please take into account, sundry costs such as Office Furniture and Fittings, Laser Printer and Copier and any delivery vehicles must be taken into consideration and will vary from Branch to Branch.

Once an applicant is approved (which includes extensive credit checks), a credit application as well as a franchise agreement is concluded regulating all aspects of the franchise relationship.

NOTE: All the amounts mentioned above and below are an estimate and may vary from time to time.

Capital Outlay

Finance Consult your bankers for advice and Terms and Conditions on funding for Franchisees. We will require proof of funding to the amount of R 3 750 000.00 before validating of a new Franchise. Take into account working capital requirements of about R 200 000.00 as well as provision for rent deposit.

• The Franchise Agreement once signed, R 115 000.00 (VAT incl.) joining fee, and R 57 000.00 (VAT incl.) advertising fee, is to be paid in full before any training commences at Goldwagen Pretoria West or a Designated Corporate store.

• Retail / Building Space: Preferably well-situated, visible and requires our site assessment and approval. We also recommend a Geospatial Analysis be performed on the area. Interior: Goldwagen Stores require an under roof space of roughly -/+ 500 - 1000 sq.metres, and adequate parking is essential. Goldwagen has a formalized store layout and signage design. The stores layout will be conceptualized by WAG and a professional graphic artist will provide assistance with the signage design. These specifications must be adhered to and no deviation or alterations will be permitted. Only Goldwagen accredited suppliers are to be utilized.

• Delivery Cost: Our dispatch will deliver free of charge if within delivery range. If outside the area agreed upon, a minimum order value of R 40 000.00 will need to be placed for Goldwagen Head Office to cover courier costs, otherwise any freight will be for your own expense, and excludes cross border deliveries, which have different incoterms.

• Training: A minimum of one month’s training at Goldwagen corporate stores providing that the trainees have had previous Auto parts experience, however we recommend that two to three months training be completed. If the trainees do not have any parts experience a minimum of six months training is recommended.

+/- R 2 400 000.00 Minimum Opening stock order depending on store size+/- R 180 000.00 Signage (including design)+/- R 170 000.00 Counter, Glass Cabinets, Tiling, Lighting, Carpet, etc.+/- R 500 000.00 Shelving+/- R 298 000.00 Computer hardware & software, phone system, cabling for 11 points and data

connections.+/- R 30 000.00 Marketing and Advertising Material+/- R 115 000.00 Joining Fee

+/- R 57 000.00 Advertising Fee for grand opening

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Franchise Information 2017

Computers Goldwagen offers a complete I.T. solution to run and maintain your investment, which provides you with information at your fingertips right from the word go, even if you are new to the industry. By using state of the art software and systems backed with our knowledge and expertise we can offer you peace of mind that your business has the best potential to grow. With everything from Stock Control, Debtors & Creditors Control, Stock forecasting and a fully integrated accounts system as well as many more features.

A typical store would run at 4 users (3 sales points and a back office or admin machine).

The estimated costs for 4 users, will be:

VoIP rates excluded and billed directly from Neotel.

It is compulsory that all computers are bought through WAG.

Franchise License FeeA License fee of R 20 950.00 (VAT Included), will be charged monthly with a 10% annual escalation thereafter.

AdvertisingA compulsory monthly Advertising Fee of R 5 130.00 (VAT incl.) is payable by all franchisees to the Franchisor. We advertise in a variety of different media, including printed, audio and visual. We also exhibit in certain trade shows.

All amounts in relation to the initial capital outlay of R 3 750 000.00 are subject to change without prior notice, and are dependent on store size.

Should you require any further information please do not hesitate to contact us?

Shawn Gilbert 012 7483800franchise@wag-online.co.za

R 250.00 Per user (software) Monthly FeeR 196.00 Per email address Monthly FeeR 1 800.00 Data Monthly FeeR 500.00 VoIP Monthly FeeR 250.00 SLA Neotel Monthly FeeR 1 450.00 Back Up Monthly FeeR 800.00 Phone System Annual FeeR 2 950.00 SAP Annual Fee

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