PROSPECTUS 2018 - SA Franchise Brands Bistro – Prospectus 2 ... baked buns and ingredients of the highest quality. If you are keen to become part of the success which is Burger Bistro,

PROSPECTUS

2018

Winner of the

2016 Franchisor of the Year award

in the newcomer category

Prepared by The Practice Business Consultancy

Burger Bistro – Prospectus

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From the Founders

My name is Corné Read, and together with my partner Jan-Hendrik van Staden, we

own and manage a hamburger restaurant called Burger Bistro.

Realising that there are no truly decent hamburgers to be found in Pretoria, or for that

matter, elsewhere in South Africa; and prompted by childhood memories of a burger

joint in my part of town, I decided to open my own hamburger restaurant. I contacted

my friend Jan-Hendrik, a successful and experienced restauranteur, and we decided to

make a go of it.

We soon secured premises which we thought to be ideal, and opened our bistro in mid-

2012. At the time we dreamed big, but our achievements have far outstripped our goals.

We ascribe our success to hard work, the inspiration of excellence and a vision which

arose from our passion for great burgers made with prime-quality patties, specially

baked buns and ingredients of the highest quality.

If you are keen to become part of the success which is Burger Bistro, put half an hour

aside, make yourself comfortable, read through the document with care and envisage a

brand new and fabulously exciting future! We are ready to share our knowledge and

skills with a limited number of prospective franchisees and will guide them along an

enjoyable and fruitful journey with Burger Bistro.

Corné Read & Jan-Hendrik van Staden

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The Prospectus

This document is meant to impart sufficient information regarding the Burger Bistro

franchise opportunity in order for you, the prospective franchisee, to take an informed

decision on whether you wish to become an important part of this exciting business and

to make the journey with us!

Read and be inspired!

The Concept

Burger Bistro is a cosy little burger restaurant, fully licenced, and jointly owned by Corné

Read and Jan-Hendrik van Staden – two guys who love good food, especially burgers,

and who, six years ago, had a dream and a vision! They would create hamburgers, the

likes of which could not be found anywhere else. Their burgers would be the most

delicious and mouth-watering

conceivable, and be prepared

with the love and passion of true

connoisseurs.

They would provide a wide

variety of choices to suit all

tastes, and which would vary from the good old bacon and cheese burger to the

“Marilyn Monroe” – a burger topped with melted brie, strawberry-balsamic vinaigrette

Burger Bistro – Prospectus

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and black pepper compote – not to mention the fabulously decadent “Godfather” – a

carnival of Emmentaler, salami, and basil pesto flavours!

The patties would be made on-site of only the highest quality meat, and the buns

specially baked for the bistro every morning. The unique chips recipe would ensure a

delightful culinary trip down memory lane, while all products and ingredients would be of

only the freshest and highest quality available. They would specialise in burgers, but

also have a limited number of other gourmet dishes available. Yet, they would be

forever true to their pledge to provide the best value for money – in short, their menu

would be affordable!

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Their patrons would describe their décor and the image as modern-eclectic, with a

touch of nostalgia having borrowed ideas from their childhood – from Ninja Turtle

posters to old VW bonnets, reminding people of the good old days!

The Beginning

In March 2012 the founders commenced with the setting up of the bistro. Due to budget

restraints, most of the work was performed by Corné and Jan-Hendrik themselves. It

was a labour of love and after many a night of toil the work was finally completed. With

their restaurant shipshape, their recipes tried and tested, their staff trained and their

systems in place, trading started in earnest in June of that year. Burger Bistro was an

immediate and resounding success! Profits continued to soar and diners needed to

start booking in advance. The business exceeded the principals’ wildest expectations

and continued to grow from strength to strength.

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Realising the potential of Burger Bistro as a national chain of burger restaurants, and

having streamlined its operations and procedures, the founders decided to expand the

business by inviting like-minded and deserving candidates to join the organisation as

franchisees, and to share in the success of the concept. In September 2013, they

employed the services of a specialist, FASA-accredited franchise consultancy to direct

their franchise roll-out programme. By January 2018, six new Burger Bistro

restaurants had been sold, four of which have since opened and which are

performing superbly and very profitably. The outlets in George and Struben’s

Valley will be opening shortly.

Burger Bistro - Hazelwood

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Franchising

For any franchise network, in this instance, Burger Bistro, to be successful, both the

franchisor and its franchisees must derive solid and enduring benefits from the

arrangement. Although the parties’ expectations converge, their perceptions of the

advantages of franchising will differ.

A very distinct advantage for the franchisor is that rapid expansion of the concept is

possible and that this would require relatively little capital. Burger Bistro should be able

to realise its franchising plans, thereby expanding its footprint and brand, based on

investments made by the franchisees. Perhaps more importantly, franchisees, having

made a substantial investment in their own businesses can be relied upon to maximise

market penetration and operational efficiencies on an ongoing basis.

Burger Bistro - Montana

Burger Bistro – Prospectus

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Franchisees on the other hand, will have the ready use of the brand, immediate access

to the franchisor’s intellectual property and know-how, benefit from a proven, tried and

tested system, receive comprehensive initial and ongoing training and support, gain

from bulk discounts which the franchisor may negotiate on behalf of the group, and

benefit from the future network’s joint advertising.

Value Proposition – it is of great importance that the value proposition is attractive to,

and resonates with, prospective franchisees. Consequently, great circumspection and

much thought have gone into creating a workable franchise package. Successful

candidates will receive a complete turnkey operation which includes the licence fee,

project management, professional fees, set-up of the premises, fixtures, fittings,

furniture, equipment, décor, P.O.S. system and signage, as well as four weeks

comprehensive initial training, and stock in trade to the value of R50,000 excluding VAT.

All this for only R1,250,000 excluding VAT, and subject to the size and state of the

premises. Franchisees need at least 50% of this amount in unencumbered cash, the

balance of which can be financed through a

financial institution. The value proposition

offered by Burger Bistro is attractive. The

margins are high, the growth potential is

promising, and its membership of The

Franchise Association of South Africa

(FASA) lends credibility to the brand and

makes it easier to obtain finance.

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Franchisees can expect to receive a return on their investment in around 24 months. In

exchange for a monthly management service fee (royalty fee) of 5% of turnover, the

franchisee will receive top-notch support from the franchisor head office in all aspects of

the operation of the restaurant. This support will include regular visits and addressing

franchisees’ difficulties in all facets of their business. A further monthly contribution of

2% of turnover payable by the franchisees will be appropriated for national advertising

on behalf of the group.

Criteria – in order to qualify as a franchisee, a candidate needs to preferably have

experience in the restaurant and food industry. If not, a suitably qualified person should

be appointed as manager. Applicants need to also have access to the necessary funds

to buy the franchise, as well as operating capital in the amount of R150,000, excluding

VAT. Most importantly however, the prospective franchisee must be highly motivated

and passionate about owning and operating a Burger Bistro franchise, and must be

wholly committed to succeeding in the business.

Training – Franchisees and staff will undergo four weeks’ initial training in order to

properly prepare them to be true and

valuable ambassadors of the brand.

Trainees will be thoroughly

instructed in all aspects of the

business, receive both theoretical

and practical training, and will be

intensively tested on the preparation

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of all dishes and on their familiarity with the menu. Ongoing training will also be

provided from time to time. Training will primarily take place at the franchisor head office

in Pretoria, with some training taking place at the franchised outlet.

Location – Premises and sites are of paramount importance on Burger Bistro’s list of

priorities. An area of approximately 150m2 to 180m2, with 3 phase power supply, able to

comfortably seat 40 to 50 diners, located in relatively inexpensive convenient centres,

with ample, safe parking and great visibility. Burger Bistro’s décor and corporate

identity are the golden thread that runs through the franchise network and which

provides a warm, welcoming ambience suited to the discerning foodie, conjuring up

memories of days gone by.

Profit Projections – profit projections are based on results obtained by the franchisor’s

existing operation, those of the franchised outlets, on figures which the franchisor

believes could realistically be achieved by franchised outlets, as well as those of

comparable industry participants. It can however not be guaranteed that franchisees will

achieve the same results nor is it intended that franchisees rely on them as guarantee.

The projected income statement does not reflect depreciation, salary for the franchisee,

the cost of servicing the loan, or taxes. All figures exclude Value Added Tax.

Franchise Enquiries

For any enquiries regarding franchising or for more information contact Louis Mienie on

(012) 346-6147/8 or e-mail [email protected].

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Prospective franchisees shall be requested to complete the application form which will

be provided on request.

Can you spot the difference?

One is a “100% beef patty, cheese, onion,

juicy tomato, crisp lettuce and in a sesame

seed bun.” – the other is a 100%

Burger Bistro!

Praise for Burger Bistro

“A funky burger joint in an unusual part of town with 50s décor and a cool vibe. They’ve

perfected the patty, from simple and vegetarian to exotic and gourmet. Try the Marilyn

Monroe with melted brie, strawberry-balsamic and black pepper jam” - EatOut2014

(Burger Bistro is listed as one of South Africa’s 500 Top-Rated Restaurants)

“it was a delicious, huge meal, not overwhelming but generous.”

- Pretoria News - Diane de Beer

“Best burgers in S.A. I would say well done to both of you. Still think it was started with

a vision and became a reality with a lot of time and effort put into this – now you are

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becoming a hugely successful restaurant, packed with good people, memories and

great food!”

- Lesinda 12 May 2013

“Love this place... even us Capetonians can appreciate a good burger!”

- Janine Germishuys Facebook

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Projected Income Statement Year 1

These figures indicate gross margins and revenue expenses at stated turnover levels which have been experienced by franchisor or franchisees in their own operations. There is no guarantee that you will achieve the same results nor is it intended that you should rely on them as guarantee. The projected income statement does

not reflect depreciation, remuneration for the franchisee, the cost of servicing the loan or taxes. All figures exclude Value Added Tax.

Burger Bistro – Prospectus

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Projected Income Statement Year 2

These figures indicate gross margins and revenue expenses at stated turnover levels which have been experienced by franchisor or franchisees in their own operations. There is no guarantee that you will achieve the same results nor is it intended that you should rely on them as guarantee. The projected income statement does

not reflect depreciation, remuneration for the franchisee, the cost of servicing the loan or taxes. All figures exclude Value Added Tax.