April franchisee prospectus 2013 to be the liquid fuels marketer of choice in southern Africa
Dear Sir/Madam Thank you for your enquiry regarding a possible investment in a Sasol Convenience Centre. Attached please find the document explaining the company profile, capital expenditure, as well as other information regarding the franchise. Please remember to submit an electronic copy of the Franchisee Application form to: The Franchise Staffing Manager OR Register on-line via our website: www.sasol.com/franchising/franchise opportunities OR Call our Contact Centre on the toll free line : 0860 335 444 Yours sincerely, The Franchise Staffing Manager page 2 franchisee prospectus 2013
1. introduction Sasol Oil is a subsidiary of the Sasol Group of companies. Sasol Oil s main function is the sales and marketing of various fuels and lubricants products, including motor fuel, diesel, liquid petroleum gas, motor oils and greases. 2. our shared values and desired behaviours are: 2.1. Safety We are committed to zero harm and all that we do, we do safely 2.2. Stakeholder focus We meet customers needs by providing world class service, optimal product performance and efficient support systems. 2.3. People We create a caring, engaged and enabled work environment that recognizes both individual and team contributions in pursuit of high performance. 2.4. Excellence in all we do We deliver what we promise and add value that goes beyond what is expected 2.5. Accountability We take ownership of our behavior and responsibility to perform both individually and in teams. 2.6. Integrity We act consistently on a set of value, ethical standards and principles. page 3 to be the liquid fuels marketer of choice in southern Africa
3. sasol convenience centre This document does not represent a contract or agreement and may not be interpreted as such. The document serves as a reference to questions frequently asked by people applying for a Sasol Franchise. 4. our shared values and desired behaviours are: Question 1: How do I apply for a Sasol Franchise? You will need to complete the Application Form and send it to us together with the documents required on page 1 of the Application Form. You will also need to have at least 60% unencumbered cash of the total capital required. The balance can be a loan from a financial institution. (NB: the gearing need to balance in terms of your contribution against the loan). Recruitment Process: After a paper selection process (application form screening), telephone screening and the initial interview, short-listed applicants will undergo further assessment tests where a non-refundable commitment fee of R3 000 is payable for the assessment test. Should they meet all the requirements, the successful individuals will be requested to compile a business plan (business plan template will be provided). The business plan needs to be submitted within 2 weeks. These business plans will be screened and short-listed individuals might be invited to a panel interview. Check our website for available franchises and apply for the site of your choice. Question 2: How much Franchise Fee ( Right to Trade ) will I be expected to pay? You will be expected to pay an upfront franchise fee of a minimum of R2 500 000 excl VAT. This fee will be dependent on the locality of the site, Sasol investment in the infrastructure and equipment and, accordingly, our expectations on the profitability of the site. The franchisee will need to factor into his /her business plan an expected return on investment. A further R800 000 Bank Guarantees (Product /Rentals) will also be required upfront. In case of a carwash, an additional R120 000 Franchise Fee excl. VAT will be required. page 4 NOTE: This fee is for preliminary costs incurred by Sasol in connection with the setting up of the franchise system e.g. development of corporate identity and a corporate design; location analysis; development of equipment; business finance, marketing and staff plans; drafting/updating of manuals; establishment of franchise management division. franchisee prospectus 2013
Question 3: What is the total amount of capital required excluding the upfront Franchise Fee? You will require an additional amount of R1 850 000 to cover your start up costs. Question 4: What do I get for my money? You will receive: 1. Well thought through business opportunity. 2. Thorough initial training for you and your staff. 3. Initial and on-going business support. 4. Central purchasing facilities. 5. Professional services and benefits negotiated by Sasol. 6. A complete building/structure, which comprises of: Forecourt (include pumps and tanks but excluding stock) Sasol branding and signage Sasol delight! (Convenience Store) including equipment (excluding stock) ATM where approved by the bank Car wash (some locations only) Question 5: Which areas are available? We are currently building in the following provinces: Gauteng, Mpumalanga, Northern Province, KwaZulu Natal, Free State, North West, Western, Northern Cape. Notification of available Franchise opportunities will be advertised on the Sasol website with the address www.sasol.com/franchise and in the local or national newspapers. page 5 to be the liquid fuels marketer of choice in southern Africa
Question 6: Initial Assistance: The franchisor will also provide assistance with: Marketing and advertising required, including the initial launch of the business; Design and layout of the premises; Incorporation of tradename(s) and trademarks; Training of staff; Installation of equipment, fixtures, fittings etc; Management, stock control, front and back office systems; and Financial management systems.capital EXPENDITURE (ESTIMATED CAPITAL REQUIRED) Minimum Franchise Fee (Excl VAT) R 2 500 000 Car wash (if included) (Excl VAT) R 120 000 Guarantees (Approval of funds by the bank) R 800 000 Start-Up-Costs Wet Stock (Forecourt) including (40 000 liters stock and calibration fuel) R 550 000 Dry stock (C-store) R 250 000 Deposits (municipality connection charges) R 50 000 Initial requirements R 130 000 Working capital R 550 000 Estimated Total Capital Required R4.150 Million NB: Own cash contribution: at least 60% plus of the total amount required page 6 franchisee prospectus 2013
5. monthly franchise fees You will be required to pay the following monthly fees: Forecourt fees are charged monthly at a rate of 18% of 99.02 cents per litre (Reseller Margin of 80.42 cents per litre minus 18.98 cents per litre wages contribution) on all fuel volume sold from the premises. Turnover fees in the Sasol delight! convenience store including the bakery is 10% on all gross shop sales (excluding cell phone airtime and lotto sales) Fees for ancillary businesses are available on request and relate to the particular franchise to which the ancillary business relates not included in the Estimated Total Capital Required. Notes: please note that the above serves as a guide only and figures quoted were applicable at the time of update 6. Do I face any possible risks? Like any business there is no guarantee of success. Franchised businesses usually have a higher success rate than other independent businesses because of many of the reasons outlined in this document. However franchisees do fail. Some of the reasons are: Investment of insufficient capital in the business resulting in excessive borrowing. Insufficient research on the part of the Franchisee resulting in unrealistic expectations. Lack of compliance with the franchised business system. Lack of commitment, dedication and motivation to the time requirements of the business i.e. absent owners/franchisees. Poorly selected, trained and managed staff Undesirable business environment. page 7 to be the liquid fuels marketer of choice in southern Africa
www.sasol.com/franchising/franchise opportunities