THE REAL BEAN COFFEE COMPANY FRANCHISE PROSPECTUS
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1 supplying coffee providers nationwide THE REAL BEAN COFFEE COMPANY FRANCHISE PROSPECTUS The Real Bean Coffee Company (Franchising) Limited Gill O Brien, Franchise Sales Representative telephone mobile gill@fdsnorth.com Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 1 The Real Bean Coffee Company is a registered trademark of The Real Bean Coffee Company Limited Franchise Information Memorandum 2010 The Real Bean Coffee Company (Franchising) Limited. All rights reserved
2 Spilling the Beans THE CONTEXT There s comfort in my coffee cup, sang Billy Joel. Most of us would appear to agree. Seventy percent of British adults are regular coffee drinkers, consuming an average of three to four cups per day. Between us we now drink more than 70 million cups daily an impressive figure for a nation of 61 million. Coffee drinkers ask only a cup of hot, fresh, and flavourful brew, and some favoured accoutrements. Coffee providers hope to provide as much at a profit or at reasonable cost. Most struggle. It is not for lack of incentive. The rewards for offering a satisfying cup are sizeable: coffee drinkers are famously loyal to their favourite purveyor, and eagerly spread the word on their behalf. The problem is often one of materials and their use. It is notoriously difficult to select the right beans and machines, and harder still to keep both working in harmony. Make a selection for the wrong reasons or neglect your equipment, and the coffee that is served is bland, bitter, or burnt. Serving disappointing coffee alienates seven out of ten adults and undermines their perception of value. Britain s coffee drinkers deserve better. Britain s coffee providers deserve better. The Real Bean Coffee Company is a stimulating mobile sales-and-service franchise business that offers its owner(s) a host of professional, social and financial perks. The Franchise Owner delivers a unique, full-service solution to hot beverage vendors and providers in their exclusive territory. Our solutions include the advice, equipment, installation, support and supplies that our customers need. Our business is booming, our brand is established and the market potential has been proven. The opportunity is yours. THE CONCEPT Coffee providers need dependable, cost effective equipment: machines that are appropriate for their needs and which can be trusted to turn out a good cup of coffee every time. They need to be adequately trained on the use of this equipment, and provided with ongoing support to minimise disruption to their service. They need beans that produce a pleasing cup of coffee at a price point that works for them. They need these beans and their coffee service items available whenever they're needed. Coffee providers need someone who can promise as much, a supplier who makes it easy to comfort the coffee drinker at a comfortable profit. It was with this understanding that Scott Whitton, Paul Barlow, and Steven Moores coffee suppliers, providers and drinkers themselves founded the Real Bean Coffee Company on New Years Day Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 2
3 Knowing that satisfied coffee providers would make satisfied coffee drinkers, the trio set out to develop an exceptionally customer-orientated offering. They secured unprecedented access to the most trusted professional coffee making equipment in Europe, then slowly developed a portfolio of beans that will please most any palate. The trio then set out to provide the providers with the help that they so desperately needed: help identifying appropriate and cost-effective equipment, help getting the equipment set up, help using the equipment, help choosing the right supplies, help keeping stocked, and most importantly, help should anything go wrong. Offering a friendly and helpful bespoke turnkey coffee provision solution, the Real Bean Coffee Company blossomed amidst the harshest economic winter. Within a year of its founding, the business which set out only to serve Greater Manchester became a potent new player in the national market. Whilst sales have grown rapidly, two things have remained constant an extraordinary dedication to the needs of the customer and the extraordinary financial rewards it has entailed. Every month, the Real Bean Coffee Company is reminded of the truth of its founding assumption: make it reliably easy to delight patrons at a profit and you make everyone happy. THE REAL BEAN COFFEE COMPANY IS FRANCHISING Having refined our methods, system and presentation, The Real Bean Coffee Company now seeks to offer its service across the UK. Franchising is the surest way to bring our unique coffee provision solutions to the tens of thousands of businesses and organisations that need them around the country. Our aim is to develop a national Real Bean Coffee Company network that is universally respected and greater than the sum of its parts. Utilising our proven methodologies and the drive of its Franchise Owners, the Real Bean Coffee Company will be the highest quality and most popular coffee equipment and product supply business in the UK. In return, Franchise Owners receive invaluable skills training, a proven business formula, personalised support, a strong brand name, and an unmatched opportunity to enjoy the financial rewards of sowing Real Beans in their backyard. We are committed to sharing the rewards inherent in the Real Bean Coffee Company business system, and are committed to abide by the principles of ethical franchising. The Real Bean Coffee Company (Franchising) Limited operates in accordance with the British Franchise Association s code of practice. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 3
4 A Stimulating Opportunity INTRODUCTION The Real Bean Coffee Company is a relationshipbased professional service business. Franchise Owners enable local businesses to offer quality coffee at a profit, or at a reasonable cost. Provided with a comprehensive franchise business package that includes in-depth training, ongoing support, remarkable business tools and an exclusive range of customer-friendly products and services, Franchise Owners confidently gain and maintain fruitful long-term accounts. Franchise Owners enjoy the mobility and interaction that is essential to the delivery of quality customer service. Offering highly attractive coffee provision solutions, Franchise Owners also enjoy the substantial financial benefits that come from delighting hospitality, catering, leisure, office, and institutional customers in their territory. MARKET OUTLOOK The UK coffee market weathered an extended period of price inflation and fierce economic downturn rather well, growing almost 20% between 2005 and Trading up is still a defining feature of the market. The same survey found that almost two thirds of instant coffee drinkers will drink ground coffee, pointing to a sizeable opportunities for suppliers like the Real Bean Coffee Company that make a compelling case to trade up. EARNINGS POTENTIAL A selection of projections is shown on page seven. Please note that your earnings are still largely dependent on your effort, dedication and tenacity. We hope that you find this document informative, and that you find yourself inspired to learn more about the Real Bean Coffee Company business. When you are ready to further your investigation of the Real Bean Coffee Company franchise opportunity, fill out the enclosed enquiry form and mail it to the indicated address. Should there be a mutual interest, you will be invited to an exploratory meeting, during which time you will be provided with detailed financial data. This information will allow you to conduct an informed discussion with your advisors, and help you to draw up a credible business plan for your chosen location. While 90% of the nation s 27m regular coffee consumers drank some kind of instant coffee in the last year, more people are seeking out a fresher product. A 2010 Mintel survey found that the year old age group is almost twice as likely to make coffee at home using coffee beans as the average, highlighting the impact of coffee bars on the tastes of a growing majority of coffee drinkers. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 4
5 START-UP COSTS Prospective buyers will be required to invest 18,000 plus VAT. An estimated 9,000 (plus VAT, where applicable) in start-up and working capital provision will also be required for a total investment of 27,000 (plus VAT). A complete breakdown of the investment requirement and Franchise Package will be supplied to qualified applicants. FOR THOSE FULL OF BEANS Real Bean Coffee Company Franchise Owners apply their sales and/or account management experience and strong people skills to build a highly successful business. While technical expertise is not required, Franchise Owners will have the opportunity to learn about the operation of coffee preparation equipment. An enthusiastic self-starter who enjoys working with people, the Real Bean Coffee Company Franchise Owner has the determination and commitment to make a proven system work for them. TRAINING + SUPPORT Real Bean Coffee Company (Franchising) Limited provides its Franchise Owners with a Comprehensive Training Programme covering all aspects of the Real Bean Coffee Company business. Franchise Owners enjoy a formal induction into the market, methods and systems of the Real Bean Coffee Company over five days at the Franchisor s head office in Greater Manchester. Additional sales and business coaching is provided in up to five days of hands-on completion training at the Franchise Owner s location prior to launch. After four to six months of trading, Franchise Owners enhance their growing product knowledge with a follow-on technical training course in Bergamo, Italy. Our professional support team will assist the launch of every Real Bean Coffee Company franchise and will provide every Franchise Owner with a host of ongoing professional support services. The Real Bean Coffee Company Operations Manual, on loan to our Franchise Owners for the duration of their trading licence, outlines our every business practice. No business will deliver immediate wealth. The most successful business owners are those who are prepared to focus on delivering value to their customers. Success tends to follow. Franchise owners are provided with the training, tools and support required to delight their customers. The Franchise Owner requires only the determination to apply the proven model and the dedication to make it work for them. Together, we will lay the foundations for a thriving business. TERRITORY We are seeking to establish the Real Bean Coffee Company throughout the United Kingdom. Not all locations are suitable, so it is essential that any chosen area be carefully assessed. We retain the final decision on territory. LEGAL AGREEMENT Real Bean Coffee Company Franchise Owners secure the right to operate a Real Bean Coffee Company franchise business using the franchisor s Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 5
6 proprietary brand, methods, tools and systems. Your rights and responsibilities will be clearly detailed in the Franchise Agreement, the legal document governing the relationship between the franchisor and the Franchise Owner. BRANDING We have invested heavily in the development of the Real Bean Coffee Company brand, image and trading style. As a Real Bean Coffee Company Franchise Owner, you will be able to trade under a recognised, well-respected brand name. As the network develops, you will benefit from strong national and regional promotional activity, and a strong brand identity. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 6
7 For the Bean Counters THE PROJECTIONS The financial projections below assume that Franchise Owners will operate with similar overheads and third-party costs. Whilst illustrative, they are based upon the performance of our flagship location. Actual turnover and profitability will depend upon the effort of each Franchise Owner, their location, overheads and market conditions. THE DISCLAIMER These figures are for the purpose of illustration only, and are not intended as a guarantee. A full description of the assumptions upon which they are based is available from Real Bean Coffee Company (Franchising) Limited, and will be provided during any presentation. Projected Trading Profit Example 1 Example 2 Example 3 Revenue (net of VAT) (1) 105, , ,000 Gross Profit (2) 47,500 56,500 68,000 Overheads (3) 24,270 28,370 33,070 Operating Profit (4) 23,230 28,130 34,930 Revenue is the total annual sales of installations (i.e. the difference between the sales and the cost of services and goods provided), exclusive of VAT. Gross Profit is the anticipated achieved gross profit of the franchise. Overheads are the costs of running the business. Operating Profit excludes any capital repayments, interest payments and directors remuneration, and is stated before taxation. NB: This is a home-based franchise opportunity. Each franchise will be subject to an individual cost and overhead structure. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 7
8 References FRANCHISE CONSULTANTS Franchise Development Services North Atlantic House, Atlantic Street Altrincham, Cheshire WA14 5NQ United Kingdom Contact: Tony Urwin Phone: Fax: LEGAL COUNSEL David Bigmore & Co. Thornton Grange, Chester Road Gresford LL12 8NU United Kingdom Contact: David Bigmore Phone: BANKERS Barclays Bank Exchange Quay, Salford Quays Salford M5 3BE United Kingdom Contact: John Walsh Phone: CHARTERED ACCOUNTANTS Wrigley Partington Chartered Accountants Sterling House 501 Middleton Road Chadderton, Oldham OL9 9LY United Kingdom Contact: Richard Dixon Phone: Fax: Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 8
9 Easy as Beans WHAT NEXT? Naturally, neither party can make any decisions at this early stage. You will require further information and professional advice, whilst we will need to know more about you. Every Franchise Owner plays a fundamental role in the growth of the Real Bean Coffee Company network and brand. We therefore need to apply a very careful selection process. APTITUDES Whilst the Real Bean Coffee Company will provide training in all aspects of the operation, you will still need to consider your aptitudes and suitability for this franchise business. We are entrusting our good name to each of our Franchise Owners, and investing our time and energy in their business. Like you, we wish to invest wisely. We have a clear idea of the attributes that make a person well-suited to the Real Bean Coffee Company business, and are prepared to take the time to find such an individual. Successful Franchise Owners will have business-tobusiness sales and/or account management experience, ideally (but not necessarily) gained in the hospitality or catering industries. They will possess superb people skills and demonstrate professionalism, initiative and an ability to follow systems. They will also have an appreciation for good coffee. The Real Bean Coffee Company promises exceptional customer service. Our Franchise Owners must be able to deliver on that promise. A customer care mentality is essential, as are strong organisational skills and prompt and level-headed response to problems. Franchise owners must be prepared to take responsibility and ensure that things are always correctly done the first time. THE ENQUIRY PROCESS If you are interested in finding out more, here is how to proceed: Begin by completing the preliminary enquiry form on the following page. (Completion of the form places you under no obligation.) Applicants who meet our criteria will be invited to an exploratory meeting where we will explain the Real Bean Coffee Company franchise business in detail, discuss the figures, and explore possible locations. We will also be able to answer your questions at this time. Following the meeting, you will need time to consider the opportunity, go over the figures with your professional advisors, talk to your family, and start to review the market potential in your preferred location. You may also have further questions to ask us. If, after all your consultations, you wish to apply for a Real Bean Coffee Company franchise, you will be required to complete an Intent to Proceed agreement and pay a deposit. At no point will we apply pressure on you to come to a decision. At this stage, the next step is simply to submit a completed preliminary enquiry form to obtain further information. We look forward to hearing from you. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 9
10 Enquiry Form I have read your prospectus, and would like further information about the Real Bean Coffee Company franchise business opportunity. Please contact me to arrange a meeting. name (please write below) available investment amount <10k [ ] 25-50k [ ] 10-25k [ ] 50k+ [ ] How do you propose to fund this investment? home telephone no. daytime or mobile no. address Do you own, or have you ever owned, a business? yes [ ] no [ ] Please describe the reason(s) for your interest in the Real Bean Coffee Company. city Where in the UK are you interested in operating? county postcode date of birth I confirm that the information I have provided is to the best of my knowledge true and complete. current situation house owner [ ] tenant [ ] Signed Date marital status married [ ] single [ ] divorced [ ] Does your spouse/partner work? (if applicable) yes [ ] no [ ] number of dependents (and their age/s) current income band <25k [ ] 50-75k [ ] 25-50k [ ] 75k+ [ ] Please return the form along with your CV to: Gill O Brien Franchise Development Services North Atlantic Business Centre, Atlantic Street, Broadheath, Altrincham, Cheshire WA14 5NQ Alternatively, you can fax the documents to or scan and send them to gill@fdsnorth.com Please note that this questionnaire is for general information and will be used in assessing your suitability to become a Real Bean Coffee Company Franchise Owner. It will be treated in the strictest confidence under the terms of the Data Protection Act and in no way places you under any obligation. Further information will be required should a mutual interest develop. Franchise Prospectus 2010 The Real Bean Coffee Company (Franchising) Ltd. Page 10
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