BUILD YOUR OWN BUSINESS COMPANY AND FRANCHISE OVERVIEW

BUILD YOUR OWN BUSINESS COMPANY AND FRANCHISE OVERVIEW

VERSATILE BUILDINGS LIMITED THE COMPANY The company s origins date back to 1970 when Gerald Gee began trading under the name of Garage Builders (SI) Ltd as the South Island agent for a NZ garage brand. The company prospered with significant contracts all over the South Island and in particular in Twizel for the hydro developments. Gerald s son Bill joined the team as Manager in 1976 and ran the company from then on, later buying the company from his father. With just a small factory in Christchurch and a team of dedicated people Bill worked hard to build the company his father started. Under his management the company prospered, becoming the leader in the South Island garage market. Bill and his team developed a new-look garage and moved away from the initial agency arrangement to begin a new company called Profile Buildings Ltd in 1986. Profile quickly became established as a market force in small timber framed buildings. In 1988 Bill bought Versatile, another Christchurch garage company. In 1997, the company name changed from Profile to Versatile Buildings Ltd. At this time, the New Zealand timber framed operations were all consolidated under the Versatile brand, a brand that continues to gain market share and cement its position as the current market leader. In the same year, Versatile Buildings Ltd purchased the New Zealand distribution rights for Budget Buildings, a steelframed building system from Australia. In 2000, the Australian parent company supplying Budget Buildings, Colmark Proprietary Ltd, was also purchased by Versatile Buildings. The Budget brand was changed to Totalspan and now has a strong Australasian retail network with more than 60 outlets. Today, Versatile Buildings Ltd is well recognised as an industry leader in the modular buildings market. The New Zealand business employs over 300 people and has a nationwide network of franchises from Keri Keri in the far north to Invercargill in the deep south. Versatile Buildings Ltd will continue to be the leader in its field through its commitment and investment into quality, technology, innovation and people. VERSATILE BUILDINGS THE BRAND Versatile Buildings is not only the name of the parent company but also one of its largest and most valued brands. Extensive advertising and marketing, combined with excellence in the field, has achieved high brand awareness and strong brand equity. The market leader for garages in New Zealand, Versatile offers a comprehensive product range of engineered timber framed buildings for the domestic, rural and commercial sectors. - 1 -

THE BUSINESS PROCESS OVERVIEW So what does a Versatile franchise actually do? For simplicity, the business process has been summarised as follows: The franchisee is responsible for all aspects of the selling and construction of Versatile manufactured buildings in the franchise area. Phone, email and walk-in enquiry is generated from national advertising organised by Versatile Buildings Ltd and complimented by local advertising as required. Enquiries are converted into on-site sales appointments, which are then converted into a sale. A Building Consent application is prepared and lodged with the local Council. On issue of the Building Consent, the building pack is ordered ex the Versatile Buildings factory in Christchurch. Using local contractors the franchisee organises for the building site to be prepared, the concrete floor to be laid, delivery of the building pack (and other building materials if required) and the construction of the building. With over 30 years experience to draw from Versatile has systematised each step in the processes to improve efficiencies and the quality of service provided to customers. PRODUCT RANGE Versatile offers a range of engineered timber framed buildings, featuring primarily roll-formed steel cladding. Versatile s innovative product designs provide highly customisable building options in terms of building size, height, layout and extra features. The product range currently includes: Garages Sleepouts Cottages Homes Carports Garden sheds Farm buildings Commercial buildings - 2 -

RETAIL & DISTRIBUTION The Versatile retail network spans the entire country, with 33 franchises and three company owned branches spread throughout New Zealand, from the Far North to Invercargill. Each franchise region is required to construct (or maintain if already existing) a high profile display site, featuring a predetermined selection of our building range as display buildings for customers to view. Via the retail network Versatile provides end customers with a complete building service - from the design stage to finished buildings, including applying for building consents, construction, and providing finance if desired. MANUFACTURING Versatile s Christchurch manufacturing operation is responsible for converting sales orders into ready-to-build kitset building packs freighted direct to the franchises freight depots. The majority of the components used in our buildings are manufactured by Versatile. Other components are sourced from preferred suppliers such as Carters, Dominator, Rylock Aluminum and Allied Concrete. Versatile currently produces more than 5,000 buildings a year in New Zealand, making it the largest manufacturer of buildings in the country. Proven quality systems and manufacturing processes are used to achieve cost efficiencies, production accuracy and short delivery lead times. Franchisees receive high quality, competitively priced buildings with customer service second to none. FRANCHISE SYSTEMS If you are looking for a business of your own, statistics prove that participation in a franchise operation will improve your chances of success. Franchising works by combining the drive and energy of the entrepreneur with the experience and expertise of the franchisor. However franchising is not something to be entered into lightly, and you should check the credibility and track record of any franchisor before committing to a long-term franchise agreement. The experience of all major franchisors is that successful franchising concepts have common traits. Potential franchisees are encouraged to make an informed assessment on how Versatile s system performs against the following criteria: - 3 -

Establishment of a strong national brand Development of comprehensive operations manuals Proven long term demand for its products/services A thorough induction and ongoing training programme Dedicated and competent franchisor support Proven track record of performance by the franchisor and franchisees WHY A VERSATILE BUILDINGS FRANCHISE? As a professional and reputable franchise business Versatile Buildings offers the following benefits: Significant investment in national advertising and promotion A national brand with strong equity and brand awareness Exclusive geographical region Sales enquiry generation (display, email & 0800VERSATILE telephone enquiry) Ongoing website maintenance Customer Satisfaction survey programme Discounted buildings for display sites Professional sales training and support Operational and financial coaching Experienced and helpful R&D staff providing: Significant investment in ongoing design improvement Design and construction support for non-standard buildings Liaison with local authorities on technical issues Versatile Buildings specific Producer Statements (to improve the consent application process) Builder education and 0800 line for construction problems Nationally negotiated price discounts with preferred suppliers Informative and entertaining national and regional conferences Input and feedback to operational and strategic issues via established Franchise Liaison Team 25 year structural and 5 year product and workmanship guarantee Systemised processes (from answering the phone through to debtor control) Strong cash flow business (via favourable deposit regime) Financial and operational support for local events (Fieldays, A&P Shows, Home Shows) - 4 -

RESOURCES AVAILABLE Versatile makes available numerous resources and materials to assist you in the day-to-day running of your business. Examples include: VB Quote quotation software Pricing software Sales material (eg. brochures, folders, order pads, guarantee cards) Operational material and tools O.S.H programme Employment contract templates Advertising templates QuickBooks accounting software support Manufacturing, sales, administration and contract managers manuals Promotional material (flags, uniforms, signage, vehicle decals) DESIRABLE SKILLS & CHARACTERISTICS Preferably, new franchisees will be able to demonstrate the following attributes: Understand and appreciate importance of marketing and branding Positive can-do attitude People management skills (including recruitment and retention) Ability to manage multiple projects Organised with good time management skills Affinity with the building industry (understanding of the process) Computer literacy Customer oriented Business acumen (understanding of business financials) Sufficient working capital - 5 -

THE SELECTION PROCESS As an ethical franchisor Versatile has a responsibility to educate potential franchisees about the franchise system, rather than sell franchises. In franchising, as with any long-term commitment, the relationship between franchisor and franchisee must be carefully assessed to ascertain whether it will be beneficial in the long term for both parties. If after reading this document you feel you would like to pursue this opportunity further you are invited to complete the enclosed application form. Application forms received will be carefully reviewed and a shortlist of candidates will be selected for initial interviews, where more detailed and confidential market and financial information will be shared. The interview is a two way process it provides an opportunity for us to learn more about you and for you to learn more about Versatile and the specific business opportunity. From the initial interviews we will continue the selection process with a shortlist of suitable candidates until a final selection and appointment is made. CONCLUSION A Versatile franchise provides an excellent opportunity for you to form a profitable business relationship with a sound and well established leader in the large and growing building industry. The products are premium quality, aesthetically pleasing and durable with minimum maintenance requirements and a host of unique and sustainable competitive advantages. They are very competitively priced in the marketplace and provide a solid profit margin. You will benefit from the high profile brand name, the sustainable marketing and advertising programme, the on-going product development programme, extensive technical knowledge and industry experience of Versatile. Versatile Buildings Ltd. PO Box 11-013, Sockburn, CHRISTCHURCH Telephone (03) 349 1270 Fax (03) 344 2000 Email enquiry@versatile.co.nz - 6 -