| History Background |
| This innovative franchise was established at the beginning of 2007 after 4 years of research. It is based on similar successful models that have been operating in the US, UK, Canada and Australia for a number of years. The best practices of these businesses have been combined into one product offering, uniquely tailored needs of the South African market. | |
| How Does The System Work? | A consumer friendly & easy to use internet webpage allows your customers to quickly & easily find DVD's they want to watch in your store, read reviews on these movies, or even interact with other interested movie enthusiasts from the comfort of their homes. Customers can place orders online, pay online & collect the desired DVD's from your store or have them delivered. A powerful "back end" module is in place that easily & quickly records all customers on-line orders, produces instant delivery & pick-up schedules (enabling you to perform cost effective delivery/pick up service) & produces a number of user friendly reports designed to make the running of your store simple & cost effective | |
| Present Market |
| Benefits to Customers & Store Users? | Consumers rent movies they want to watch, either by creating a "wishlist" of movie on the website, or simply choosing from whats currently available in your stock. The program will automatically select available movies from your existing stock, enabling your store management to control stock levels & even order movies on demand from suppliers. Customers get regular movie updates & reviews of over 50 000 movies. Contract payments are generally made via a monthly debit order or upfront payments. There is only one existing internet based DVD rental competitor in South Africa, but they use the postal services & not a threat at all. Centralised web-based computer system controlled by H/O | |
| Financial |
| What are the Royalty Payments Per Month? | There will be a franchise fee of 5% and 2% advertising on monthly turnovers. | |
| Staffing |
| This franchise will be owner managed, with assistance of 2 staff members. Fully training will be given by the Franchisor | |
| Premises |
| The franchisor will source suitable premises for Franchisees - stores of 100 - 120m2 will be secured. | |
| Assets |
| The setup costs of a new franchise store of between 100 - 120m2 will be R374 500 + vat. This price includes a franchise fee of R40 000. Full turnkey store will be setup. Stock will consist of 1250 DVD's which will be split between new releases and most popular releases. | |
| S.W.O.T. Analysis |
| S.W.O.T. Analysis
Strengths:- Only service of its kind in South Africa. Clients will be on a debit order system or upfront payments. Franchisor will do national advertising. Clients can check what stock you have available by logging into the website, placing an order and then collecting from your store or have it delivered to them.
Weaknesses:- None
Opportunities:- Link up with fast food establishments and offer discounts on each others products
Threats:- None | |
| Reason For Sale |
| The Franchisor is selling this franchise nationally in order to establish a national footprint. | |
| Conclusion |
| This is an excellent opportunity to get into an innovative new franchise at a competitive price of R375 000 + vat (as this is for the setup of a new franchise vat has to be added onto the selling price but can be claimed back). 60% of purchase price is payable upon signing franchise agreement with the balance being paid before take over date. Accounts will be established with major suppliers such as Ster Kinekor, Nu-Metro and advice will be provided on where to buy additional DVD's, games etc. | |