Franchise Information Kit
Thank you for your time and interest in joining the Magnolia Jewellery franchise network. We hope this Franchise Kit will provide you with the information and inspiration you need to become an integral part of the Magnolia Jewellery family. As we promote the Magnolia Jewellery brand through multiple venue types, we continue to gain more and more loyal customers and receive more inquiries from individuals such as yourself asking about our franchise opportunities. In order to accomplish that goal we have assembled a team of experts in various fields such as real estate, operations, logistics, marketing, development, training and more. The Magnolia Jewellery franchise process has been carefully structured so that it can be easily and successfully replicated in various markets and unique locations, all the while withholding the brand s values of quality and consistency to ensure success. Magnolia Jewellery will be growing quickly over the coming months making it the perfect time to join our franchise family. Rest assured, when you join the Magnolia Jewellery franchise family, our highly trained team of experts will be ready to guide and assist you through every step of the franchise process from early establishment to help ensure you exceed in your business goals. The Magnolia Jewellery network already includes locations in Canada, Portugal, the UK, Australia, and Israel. As a brand, we are seeking to expand to other parts and countries around the globe with entrepreneurs sharing our commitment to the vision and direction of the business. We look forward to hearing from you soon, discuss this new and exciting opportunity and stand ready to assist you in any way we can! All the best, Tomer Reizberg, CEO
1 2 The Magnolia Silver Story pg 7 A Unique Business Model pg 8 3 Overview pg 10 4 5 What Is Distinct About Magnolia's Jewellery? pg 10 Our Retailing Configuration pg 12 6 Becoming A Franchisee pg 14 7 Always By Your Side pg 16 8 Our Brand pg 19 9 Marketing pg 20 10 Magnolia Jewellery's International Franchise Process pg 27 11 FAQ's pg 29 5
The Magnolia Jewellery Story At Magnolia Jewellery, the term handcrafted means much more than a method for making high quality jewellery; for us it is the preferred approach to living. It begins with assembling the finest raw materials and considering endless creative possibilities. Having sterling silver and semi-precious stones at our fingertips sparks our creative instincts, challenges our aesthetics and reveals the mysteries and surprises contained within. We have set out to tame nature s beauty, equipped with nothing more than a few hand tools and our imagination. For us, every finished piece is a new birth each different, unique and distinct, carrying its own special statement to the world, just like you. As you go about the business of handcrafting your life, let Magnolia Jewellery embellish your evolving taste with handcrafted grace and elegance. 6 7
World s Largest Selection of Jewellery A vast selection of approximately 2,000 different pieces of jewellery is available at any given moment at every Magnolia Jewellery kiosk. Exclusive Designers Our 25 talented designers guarantee a constant flow of new and fashionable pieces of jewellery which are exclusively available for purchase at Magnolia Jewellery kiosks. A Unique Business Model Magnolia Jewellery derives its extraordinary success from an established business model offering: * High gross margins * Low CapEx * Relatively low risk * Smart IT and logistic systems * Unique inventory system Innovation and Novelty Only at Magnolia Jewellery will you find at least 300 new jewellery designs added to the kiosks stock every month. The introduction of new models and designs ensures Magnolia Jewellery s positioning at the forefront of both fashion and design. It also ensures Magnolia Jewellery s customers always find something new, trendy and exciting each time they visit one of our kiosks. Short-Run Series All of our jewellery is manufactured in limited series, as we strictly implement a one unit per item at each jewellery kiosk stocking policy. This ensures that the pieces our customers are wearing are always unique, with an extremely low probability of them ever meeting someone wearing the exact same jewellery piece. Limited series production also ensure that we never suffer from surplus stocks or from outdated inventories at our jewellery kiosks. Handcrafted Jewellery All of our pieces of jewellery are individually designed and handcrafted to perfection. Best Materials Only the very best materials are used in crafting our jewellery pieces. Our collections contain 925 sterling silver, gold plated as well as precious and semi-precious stones. Warranty Magnolia Jewlellery is the only silver jewellery retailer that offers its customers a one year product warranty. Our confidence in the quality of our products is based on rigorous quality control; our jewellery undergo rigorous testing by accredited institutes of standards laboratories thus allowing us to accompany the sale of every item with a warranty card. Customization Magnolia Jewellery is a silver jewellery retailer that custom-tailor its products to the needs and desires of its customers. Some of the available customizations offered include a wide selection of gems in varying colors, ring sizing as well as the lengths of necklaces. 8 9
Overview Magnolia Jewellery is located in some of the busiest malls and shopping centers in North America, Australia, Asia and Europe; Magnolia Jewellery operates over 150 branches worldwide. In its 16 years of operation, Magnolia Jewellery has become a leading jewellery brand, enjoying consistent growth in samestore sales month after month. With more than 700 employees and a turnover in excess of $60 million, Magnolia Jewellery is currently one of the largest retailers of sterling silver and gold plated jewellery. Magnolia Jewellery's operations are conducted in a methodical, state-of-the-art manner in various international markets. Capitalizing on its strategic strength and its inherent operational robustness, Magnolia Jewellery is currently in the midst of rapidly expanding its presence in various countries around the world. What Is Distinct About Magnolia s Jewellery? Every woman has a lifelong desire to own jewellery. Our collection offers customers the opportunity to acquire jewellery at a price that is significantly lower than its counterpart in gold and silver, while retaining the prestige that is associated with a fine and precious metal. Moreover, the perceived value of sterling silver and gold plated jewellery, along with its affordable price level, enable customers to acquire new pieces more frequently, thereby allowing them to keep-up with fashionable trends, while simultaneously encouraging impulse purchases. Magnolia Jewellery is world famous for its wide selection of handcrafted gemstone, silver and gold plated jewellery, that also make for excellent gifts. 10 11
Our Retailing Configuration The Magnolia Jewellery Kiosk: Situated in busy shopping center junctions, the Magnolia Jewellery concept is nested in speciallycrafted kiosks. This setting has proven successful as it transforms Magnolia Jewellery kiosks into an actual anchor within the mall; a vibrant and integral part of the mall landscape. Magnolia Jewellery kiosk positioning and design ensure that no physical or psychological barriers separate the traffic in the main aisle of the mall from our jewellery, thereby allowing customers, Magnolia Jewellery sales associates and our designs to come together. Magnolia Jewellery display counters are inviting by design; the great care put in displaying our jewellery pieces, the use of clever lighting and signage attract customers so much that Magnolia Jewellery display counters sometimes resemble beehives in the springtime. All Magnolia Jewellery's Kiosks are built according to the same building specifications to maintain quality and consistency globally; however, specific modifications can be explored so that the kiosk is adapted to local legal and customary conditions at a specific location. Magnolia Jewellery owns the rights to the brand and store concept. 12 13
Becoming A Franchisee Franchising is nothing like starting a business from scratch; it offers the peace of mind of having a stable and striving partner here to accompany and support you throughout the process of opening your business while benefiting from years of accumulated experience, expertise and valuable knowledge. If you are an enterprising individual interested in starting your own business, we welcome you to our young and dynamic franchise network. Owning a franchise gives you all the benefits of owning your own business with the added support of a recognized Magnolia Jewellery brand and an established business model with a low start-up cost. Magnolia Jewellery is a young brand. Established in 1995, it has successfully devised a business model which aims at maximizing profits, seducing new customers, rewarding loyalty and ensuring sales throughout the seasons by adapting to the industry s dynamic environment and trends. With almost 16 years of experience and success in over 150 locations worldwide, Magnolia Jewellery has perfected the jewellery business model to provide you one of the best franchise operation available in the industry; one that answers the needs of a rapidly growing business spreading throughout the world. Magnolia Jewellery is expanding its franchise network around the globe thus it is seeking dedicated and self-motivated entrepreneurs, such as yourself, who wish to start their own business. We take great pride in our brand and regard our franchisees as long term business partners; as such, we entrust our franchisees with our brand's success; for these very reasons Magnolia Jewellery considers thoughtfully every prospective franchisee prior to entering into a franchise agreement. At Magnolia Jewellery, we are committed to the success of our franchisees regardless of their experience in the jewellery industry focusing on providing world class support and service with an emphasis on cultivating relationships through mutual respect and trust. As our franchisee, we consider you to be one of our most valuable partner; we look forward to explore this exciting opportunity with you and eventually share the success of our great brand in your new market. If you see yourself as a proud owner of a Magnolia Jewellery franchise, we welcome you to contact us and start the process by applying for a franchise. 14 15
Always By Your Side To Provide Logistics, Operational And Marketing Support As a Magnolia Jewellery franchisee, you will receive Magnolia Jewellery s experts stay on top of the support of a successful International franchise marketplace changes, trends, and styles so you can company - You are in business for yourself but not concentrate on running your business, focus on by yourself! managing your staff, tend to your customers needs and boost sales. In addition, we will provide you with From the moment you sign your Franchise Agreement proven systems, programs and tools that will help thru the opening of your kiosk and beyond, we will you run your business successfully. assist you in every step of the away. Our dedicated team of professionals offer you expert day-today support, advice and assistance providing Magnolia Jewellery franchise, we will also provide While training prepares you to own your own everything you need to run a successful Magnolia you with an array of resources that will help you Jewellery franchise. successfully promote your franchise and build your business well after its grand opening. Marketing Resources Consulting, strategic planning, promotions, events and implementation guides Magnolia Jewellery Conventions & On-going training Experienced Support Staff Ongoing support is a phone call or email away Franchisee Conference Calls An opportunity to share experiences in marketing and operations Website Location Page Complete Web Design, Integrated E-commerce and Social Media Resources 16 17
Our Brand The Magnolia Jewellery brand serves as the basis for creating valuable, long lasting emotional relationships with our customers. The brand s unique promise, Handcrafted Memories, connects with the innermost desires of our customers, offering them a chance to feel special and beautiful any day of the week. Our secret, combining unique items, fashion forward designs and craftsmanship with a sense of attainability and sensibility; the Magnolia Jewellery brand is as desired as it is within reach. Magnolia Jewellery s innovative approach allows women of all ages to enjoy the pleasure of owning a fashionable, stylish and high quality piece of silver jewellery that suits their personal taste, and complements their dynamic lifestyle. 18 19
Our Marketing Support includes: Marketing Major Promotions Utilize key promotions complete implementation guides and tools for primary shopping seasons. Magnolia Jewellery will provide you with extraordinary marketing materials and strategies to ensure your business becomes profitable; these will help you effectively communicate with your target market and primary customers and increase sales. We pride ourselves in our brand; Magnolia Jewellery s creative marketing team works relentlessly to create marketing materials that strengthen Magnolia Jewellery s image and global presence. We supply our franchisees consistent, cutting edge messaging and sensory branding in all our locations. We offer many unique and different marketing programs; these are not only inexpensive and easy to use, but also proven effective. Ongoing Promotions Generate traffic and purchases all year around by participating in our ongoing promotions. These unique programs and promotions have proven to be effective and include a complete set of marketing support tools. Individual Store WebPage Social Media Use social media, the fastest growing, everchanging and cost-effective tool to reach your target audiences An individual kiosk webpage, which includes SEO optimization, simple and directive information, effective and professional social networking set-up programs that you can use to communicate with your customer base. In-Store Signage Build out your silent salesperson with in-store signs and banners to highlight products and services in your location. 20 21
POS & BI Systems The software system that your franchised business will utilize is a proprietary program built into your POS. Our proprietary software comes pre-loaded allowing you to track your sales both online and off site. Another unique tool provided to our franchisee is our QlikView - a smart BI tool that provides you with precision data analysis - daily sales analysis, sales targets by station, associates and item model; Bi-weekly manager reports (per area managers, stations, sales associates, working hours, item price). QlikView models are sent via e-mail on a daily basis to your system and are updated automatically. Training Once you have signed your Franchise Agreement, we will help you prepare and operate your own successful franchised kiosk. Magnolia Jewellery conducts a unique and comprehensive five-days training program of classroom instruction. There, you will receive an up-to-date operating manual to prepare you in all aspects of the business. Our training will focus on our business model, management, inventory, customer service and a variety of other tools to ensure the smooth operation of your franchise. In addition, you will attend approximately three-days of hands-on training at a Magnolia Jewellery location. This is where you and your associates will learn the art of visual merchandising from our leading managers. In addition to setting displays, understanding sales systems, training sales associates on customer service and product knowledge; you will be privy to the operational details involved in running your franchise to ensure a smooth and successful opening. Visual Merchandising As part of the opening process, you will receive a visual merchandise layout of your location that includes detailed step-by-step guidelines on how to set up your location, make the inventory more appealing and boosts sales. As new designs and display tools become available, we will replenish your kiosk accordingly in order to ensure better visibility and exposure of the jewellery and related products and make your display more appealing. 22 23
Magnolia Jewellery is currently seeking Master Franchisors & Franchisees Worldwide
Magnolia Jewellery's International Franchise Process Step 1 Getting to know you Step 4 Discovery Day When you will first contact one of our International Franchise Development team representatives, we will discuss your background, territory availability and the financial qualifications necessary for you to join the Magnolia Jewellery franchise network. Step 2 Franchise Application Complete the application and e-mail it back to our International Franchise Development department; our executive team will then review your application. Attend a Discovery Day at a pre-set location in which you will be presented with a complete overview of our business, the industry and its operations. Upon completion of the Discovery Day, should you express interest in moving forward, you will be handed a Franchise Disclosure Document for your review and consideration. We advise you to seek legal assistance to discuss the terms of the said agreement. Following your review of the Franchise Disclosure Document, we will be available to answer any final questions you may still have concerning the details regarding Magnolia Jewellery s Franchise and its agreement. Step 3 Introductory call/meeting Step 5 Signing the Franchise Agreement Magnolia Jewellery's International Franchise Development team will set up a conference call/ meeting during which you will be officially introduced to the Magnolia Jewellery brand. We will discuss the application you have submitted, our financial and operational qualification requirements, your desired territory etc. Once the Franchise Agreement is signed, returned, countersigned and all fees are paid, you will become an official and proud Magnolia Jewellery franchisee. That is when it all really starts; our development, training, marketing and operations teams will be here to assist you in establishing and opening your new business. Congratulations! 26 27
FAQ's What is the initial franchisee fee and ongoing royalty fee? The initial franchise fee is $20,000. Ongoing royalty fee is 7% of your gross monthly sales (excluding sales tax). The current national advertising fee is 1% of your gross monthly sales (excluding sales tax). Will I have an exclusive territory? Yes, upon joining the Magnolia Jewellery Franchise, you will be granted an exclusive territory that will be clearly defined by the terms of your Franchise Agreement. How much money will I make? Magnolia Jewellery provides key cost information pertaining to the establishment of your business in the Franchise Disclosure Document. Prospective Franchisees are encouraged to use this information as they determine whether they believe the opening of a Magnolia Jewellery franchise may be profitable in their area. In addition, existing franchisees are sources you can use for more information. A list of franchisees' contact information is available as part of the Franchise Disclosure Document. Due to market conditions, locations, kiosk size and management, sales may vary from one market to another and therefore we cannot disclose profit figures. Prospective franchisees are encouraged to consult their legal and financial advisors prior to signing the Franchise Agreement. How long will it take to get approved as a Franchisee? Initial qualification involves a series of background checks and interviews; these generally take ten to twelve weeks. How long will it take to open my Magnolia Jewellery kiosk? Typically, once you have signed your Franchise Agreement and your location has been approved, you will have up to 90 days to open your business. Does Magnolia Jewellery offer financing? Currently, Magnolia Jewellery does not provide financing. What kind of training does Magnolia Jewellery offer? Prior to opening your Magnolia Jewellery kiosk, you and your Primary Operator are required to attend and complete our Magnolia Jewellery training program. The training period lasts between five to eight days and takes place at one of our Magnolia Jewellery locations. Our training program consists of approximately five days of classroom training and up to three days of on-site training at a Magnolia Jewellery pre-set location. The Magnolia Jewellery training program is intensive and covers all aspects of running your jewellery kiosk. Please note that the franchisee is responsible for all costs including travel and lodging of his team. 28 29
Do I need to have any prior experience in the Jewellery industry? You do not need prior experience in the jewellery industry; however, we do seek franchisees that have strong business management and customer service skills. Can I have my own kiosk design? Magnolia Jewellery currently offers three types of kiosk built with the same specifications in order to maintain the design and aesthetic consistency of the brand s kiosks across our global network; however, modifications can be done according to special needs and certain conditions. Does Magnolia Jewellery offer a multi-unit franchise opportunity? Absolutely! Magnolia Jewellery understands that you may want the flexibility to open multiple kiosks and have complete control over your territory. Multi-unit Franchisees also enjoy a discounted initial franchise fee on locations beyond the initial unit. Why should I invest in a Magnolia Jewellery kiosk instead of opening my own business? Franchise ownership means you are in business for yourself but not by yourself. In addition, unlike a typical franchisee franchisor relations, Magnolia Jewellery is your partner and has a direct interest in you and your business success. You will benefit from our reputation, experience, training and support; allowing you to operate a successful business. What do I do now if I want to get started? If you have read through all the information available in this kit and the Magnolia Jewellery s website and are ready to move forward to the next step, please complete the attached application and send it back to us for review and consideration by our International Franchising Development team. Please note that the process takes between 10 and 12 weeks. Do I have to operate my Magnolia Jewellery kiosk? We believe it is extremely important for an owner to be hands-on and actively involved in the day-today operations of their business; the strength of our franchise network depends on it. Disclaimer This information does not constitute nor is intended as an offer to sell, or should be interpreted as a solicitation offer to buy a franchise; it is solely intended for information purposes. The offer of a franchise in countries around the world can only be made through the delivery of a Franchise Disclosure Document (FDD). Moreover, Magnolia Jewellery will not offer or sell franchises in those countries until it has registered the FDD (or obtained an applicable exemption from registration) and delivered the FDD to the prospective franchisee in compliance with applicable law. 30 31