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1 FRANCHISE

2 ABOUT KARE SHAMELESS SINCE 1981 THE KEY TO SUCCESS THE BRAND CORE KARE has become an international cult brand and is based on a successful, proven, tried and trusted retailing concept. Since 1981, valuable experience has been gained on highly competitive retail markets in Germany and throughout the world. The success factors are decisive brand positioning, rapid internationalization, an intercultural product range, the multi-channel sales concept as well as highly professional brand ambassadors. Our key into new markets is our philosophy of decisive rejection of uninspired and mass-made furnishing products. KARE stands for sensational living and decoration concepts and offers just the right furnishing principles for architects, interior designers and consumers who appreciate good design at affordable prices. Our business concept is based on our own design lines, and our products are positioned directly on the market without intermediaries. In Germany, KARE is the most successful vertical concept for design products in franchise shops. The core of the KARE brand is a fresh lifestyle concept which presents furniture, lighting, home accessories and gift articles unique in the furniture industry. Our design-oriented customers experience furnishing trends with entertainment value and expressive energy, in other words anything except the ordinary.

3 THE CORPORATE IDENTITY THE FRANCHISE EXPERTISE THE TARGET GROUPS THE LOGISTICS STRATEGY TRADE FAIR PARTICIPATION ANYTHING BUT ORDINARY BUSINESS ADVANTAGES KARE Design regards itself as an unconventional family company we don t do dull, everyday stuff. Approximately 1650 employees in shops all around the world live our corporate culture every day. This makes us faster, smarter and more successful on the market. Our strengths are a highly motivated team, creative ideas, personal entrepreneurial commitment and unceasing enthusiasm for an irresistible trend range consisting of around 5000 products with an annual total of 1500 new articles. Our support for franchisees starts with long-standing experience in creating concepts, plans and marketing services as well as with communication tools, from an individual webpage to an intranet account. KARE s experts have extensive international knowledge in dealing with retail concepts, shop design, visual merchandising, communication and advertising and more from prestigious brands such as Escada, Boss, Adidas and similar brands. The young at heart of all ages The experience-hungry Non-conformists Hedonists Maximalists The well educated with above- average incomes; always in trend and design oriented The largest unit of the company s international logistical infrastructure is located on a property of approximately 30,000 m² in Garching near Munich in Southern Germany. In early 2012 a new 3000 m² storage facility was established in China containing the company s bestseller range for fast and direct distribution in containers. IMM, Cologne; Tendence und Ambiente, Frankfurt; Salone del Mobile, Milan; Maison & Objet, Paris; China International Furniture Fair, Guangzhou; Furniture China, Shanghai; ABUP Sao Paulo, Brazil and others. More than 120 brand stores in over 40 countries Steady growth in all business sectors Highly professionalized wholesale sector Own retail stores in Germany and Austria In-House bi-annual fairs in our showroom redboxx with about 3000m² floor room space for our collections Tried and trusted franchise system Individualized Shop-in-Shop concepts Unique in-store gastronomic concept Café Kare State of the art online shop Kare24 Mobile Marketing tools such as KARE s very own augmented reality APP KARE Designer

4 Founder, holder and CEOs: Jürgen Reiter and Peter Schönhofen FOUNDERS PERSONAL ENTREPRENEURIAL COMMITTMENT Jürgen Reiter and Peter Schönhofen are the founders of KARE and continue to be sole partners and CEOs in the company. Jürgen Reiter (M.Econ.) CEO and head of creative development, design and purchasing The international furniture business recognizes Kare as a leading trendsetter. My personal slogan is: We decorate the world! Peter Schönhofen (M.Econ.) CEO and head of marketing, sales and franchise Extraordinary design gives emotional kicks and individual authenticity in people s homes. As marketers we always think and act one step ahead. OUR COPORATE CREDO Anything but ordinary has been our corporate credo since our very first days in the design and furniture branch with a tiny shelf store. Today KARE represents a unique experience for consumers, contract business partners as well as for retailers. No other manufacturer offers a comparable modern and consumer oriented range and marketing strategy. Join our lifestyle family and become part of an incomparable and successful brand story.

5 KARE FRANCHISE MADE IN GERMANY THE FRAMEWORK FOR A FRANCHISE PARTNERSHIP Already in 1994 Jürgen Reiter and Peter Schönhofen allocated franchise rights for the first time to independent businessmen and so set the starting signal for a success story. A steadily growing number of franchise shops have been operated worldwide in more than 40 countries by independent franchise partners as mediumsized enterprises on own invoice and at own risk. The success and quality of a franchise system is always based on the quality of its partners. By the close and personal cooperation with our franchisees we have grown and evolved to become the most successful vertical concept for design products in franchise shops. The continuous exchange of experience is fundamental for the further development of our system. It is reinforced by strategy meetings twice every year at our KARE headquarters. It is our essential task as a franchisor to create efficient framework conditions for the success of the complete system. The KARE Academy provides staff training with individual support and convincing marketing strategies. It also keeps our franchisees informed on the development of the collection and guarantees qualified support in operative business for our franchisees. The KARE experts are happy to offer support to our partners with professional advice and consistent training concerning the management of trend-oriented furnishing shops. The success is mutual.

6 FIRST FRANCHISEE IN KARE HISTORY: Becoming part of the KARE network has been a source of fascination for my entire life. Andy Pietrasch, KARE Vienna KARE FRANCHISE MADE IN GERMANY Especially a system based on a strong partnership requires rules. The rights and obligations of the partners are set out in the franchise agreement. Strong brands in particular have to rely on sound principles, secured in an open system which guarantees sustainable success and in new brands rapidly gaining popularity in the market. The agreement also provides the franchisee with information on all support and services he can expect. AGREED GIVE AND TAKE Our part: International brand Expertise Training in the KARE Academy Support Maintenance Network Exchange of experience More than 10 trend collections new items a year Your part: Individual initiative Accountability Team spirit Network Media expertise Manpower Entrepreneurial spirit Capital

7 PART OF THE FRANCHISEE ARE YOU READY? WE ARE LOOKING FOR A PARTNER - A FRANCHISEE, WHO IS EXPERIENCED IN RETAIL, FAMILIAR WITH MARKET DEMAND AND FINANCIALLY CAPABLE OF INVESTING IN A KARE FRANCHISE SHOP. Social competence and a sense of autonomy are the most important features a franchisee has to offer. Knowledge of the customers daily expectations, the requirements of an enterprise and the employees is essential. Regular information and exchange of experience both on a national and international level ensures that all partners share their knowledge. FACTORS FOR BUSINESS SUCCESS The franchise system is a partnership for mutual economic success, based on the close and continuous cooperation of separate companies that are legally and financially independent. The potential franchisee must fulfil the following requirements: At least 250,000 EUR equity Basic knowledge of business administration Franchisee or a senior employee must have experience in retail Familiarity with the economy of the relevant region Presentation of marketing competitor analysis

8 LOCATION PREMISES CONDITIONS The following conditions have to be met for any new KARE shop location: City with at least 150,000 residents Minimum sales area 800 sqm, maximum sales area 3,000 sqm Location with high customer frequency in a good destination ideally within a synergetic shop agglomeration or in a 1b location within the city center Ideally located near other stores for the same target group, such as IKEA, ligne roset, Bo Concept, Habitat, or local major stores Deliveries via own ramp or at central delivery point with ramp (in shopping malls) Minimum storage space 100 sqm, depending on the shop size We offer you our know-how for your choice and assessment of a location.

9 KARE - YOUR FRANCHISOR OUR SERVICES FOR THE FRANCHISEES As a KARE franchisee you receive a significant price advantage aswell as special offer priorities compared to a regular customer. KARE provides the concept, know-how, costs calculation and analysis, visual merchandising and shop planning, staff educating & training in our office in Munich. Also, all advertising material and KARE literature, e.g. a full support when setting up a KARE shop and launching the brand on a new market. As a franchisee you are granted the right to make use of the KARE brand in an agreed market area. CONSULTING Preliminary market check Development of your business plan Development of your market strategy Consultancy for a rental contract Consultancy for the business in general PLANNING A plan in Autocad is required Planning includes: first detailed proposal and one revision All required plans are available in colour (details of shopfront, lighting plan, soundsystem plan, etc.) A complete package including individual full floor plans KARE provides functional display units for goods and lighting systems to achieve the appealing KARE shop image

10 LIFE IS STYLE KARE magazine A personalized version of our most important marketing tool, our LIFE IS STYLE MAGAZINE is available to our franchisees on request. KARE - YOUR FRANCHISOR SERVICES FOR OUR FRANCHISEES: MARKETING Regular catalogues and flyers Life is Style magazine once a year Graphic support Development of POS material Website assistancy Franchise-exclusive offer of moods and high resolution pictures access HOME COUTURE main catalogue furniture HOME SECRETS main catalogue accessories

11 KARE - YOUR FRANCHISOR CONTROLLING Order SWOT analysis Hit lists Controlling training programmes Business plan TRAINING Pre-Opening training at the KARE headquarters (Munich/Germany) (An own training schedule will be created for your needs) Working at KARE shops Shopmanager training Visiting Redboxx Visual merchandising training Comprehensive training at our Franchise Academy

12 KARE - YOUR FRANCHISOR SERVICES FOR OUR FRANCHISEES: IT Software including detailed item information My.kare.de: central franchise intranet Website: layout incl. CMS tool More than items in our 3D google sketch up gallery KARE room designer: App for iphone/ipad

13 KARE - YOUR FRANCHISOR INTERNAL NETWORK AND COMMUNICATION PLATFORM: MY KARE This service is a franchise-exclusive internal network and communication platform. Always stay informed about company news, find downloads, presentations, videos, catalogues, flyers, product information, manuals or working sheets. Contents include: Products Shop & corporate identity Marketing Public relations KARE Room Designer 3D planer Contract business China warehouse Guidelines & sheets Events & meetings Academy Website Franchise news Howto s

14 Examples KARE - YOUR FRANCHISOR SERVICES FOR OUR FRANCHISEES: KARE LITERATURE Franchise Booklet Visual Merchandising Booklet SEO Guideline Corporate Design Manual Website Manual Product overview sheets PR Guideline Facebook Guideline

15 KARE - YOUR FRANCHISOR KARE APP ROOM DESIGNER: UNIQUE AUGMENTED REALITY SALES TOOL Will that bright-green armchair look good in your customer s living room? Questions like these are answered within seconds by an app with which items of furniture can be viewed, positioned and combined within the customer s four walls as 3-D objects using your ipad and iphone camera viewer. Augmented reality technology makes it possible. The exclusive free KARE Room Designer APP is custom- made especially for our KARE franchisees. In many of its functions the company s app goes well beyond the scope of previously available applications. After the app is activated the ipad or iphone immediately switches to its camera image to provide a live view of the room in which the new furniture is to be placed. At the same time a window pops up with a catalogue containing more than 1300 items of furniture and furnishing accessories. The KARE APP proves the leadership of our company not only in the furniture business but also an innovator in marketing. KARE shop managers all around the world confirm that the Room Designer supports in-store sales and during visits to customers homes.

16 COME ABOARD! FIRST STEPS TO BECOMING A PART OF THE KARE NETWORK 1. Online application service/franchise-questionaire-en.pdf 2. Get in touch and experience the KARE world with all senses while visiting our showroom and meeting our franchise experts personally 3. Use the chance to visit our retail shops in Munich CONTACT US KARE Design GmbH Zeppelinstr Garching b. München Munich, Germany Fon: Fax: Internet:

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