The Franchiser and the Franchise

Is the potential market for the product or service adequate to support your franchise? Will the prices you charge be in line with the market?

OldTown now exports its instant beverage mixes to more than 10 countries worldwide and plans to expand its café outlet network in the region. The prices will also be the same as the market price.

Is the product or service safe and reputable?

The product have been won a few times trusted brands awards and also get various certificate in food industry so it can prove that this is safe and reputable. We will ensure to maintain consistent quality of food and service standards throughout all outlets. For the service, we will continuously invest in internal training and development programmed to ensure that all outlet staff is skilled in preparing food and providing top-notch customer services.

Is the product or service a passing "fad," or is it a durable business idea?

It is a durable business idea.

What will the competition, direct or indirect, be in your sales territory? Do any other franchisees operate in this general area?

Have many franchisees operate in this general area like Coffee Bean, Hailam Kopitiam and other. It will dispersed customer’s whereabouts.

Is the franchise international, national, regional, or local in scope? Does it involve full- or part-time involvement?

Local in scope and it involve full time involvement.

How many years has the franchiser been in operation? Does it have a sound reputation for honest dealings with franchisees?

The business starts in 1999, and until now there is about 14 years it had been operation. Within this period, they already won many awards and also increasing their reputation.

How many franchise outlets now exist? How many will there be a year from now? How many outlets are company-owned?

Number of outlets is 225.

How many franchises have failed? Why?

3 to 4 per year because financial problem or location problem.

How many franchisees have left the system within the past year? What were their reasons for leaving?

Sorry, can’t answer you this question.

What service and assistance will that franchiser provide? What kind of training program does the franchiser offer? How long does it last? What topics does it cover? Does the franchiser offer ongoing assistance and training?

Having one month training class for our staff before start working and when have new menu come out, they were send people come and teach our staff about that.

Will the franchise perform a location analysis to help you find a suitable site? If so, is there an extra charge for doing so?

Did not have extra charge for doing it but some of them were find location by themselves.

Will the franchiser offer you exclusive distribution rights for the length of the agreement, or may it sell to other franchises in this area?

Yes.

What facilities and equipment are required for the franchise? Who pays for construction? Is there a lease agreement?

The equipment are product, machine, chair, table and some else. We pays for construction and is a lease agreement.

Does the franchiser provide an estimate of expenses and income? are they reasonable for your particular area? Are they sufficiently documented?

Yes

Are you allowed to sell your franchise to a third party? Does the franchiser reserve the right to approve the buyer?

You are not allowed to sell your franchise to a third party by your own, except you have informed the company and they approved.

How risky is the franchise opportunity? is the return on the investment consistent with the risks?

If have any outlets downside to this as this gives rise to the risk of deterioration in the quality of its services and products, it may have impact on the group as whole. It will let people have negative perception to our company’s image. So that, we must ensure that its franchisees are properly trained and abide by the same system. The potential risks are the ability to retain staff at reasonable wages while continuing to expand.