This closed corporation, which was formed
in 1991 after two years of growth and with an eye to the future has as it's only
two members Lesley and Ray Hogg. It was started in 1989 when Lesley was unhappy
with the products then available. Ray developed and manufactured a much more
suitable product. This also required the design and manufacture of a suitable
nozzle and low density bottle for the application.
The range of paints has increased over the years and now has 100 colours in the
range. In the range are plain, pearlesent, fluorescents and glitters as well as
glues, plus over 200 other painting related products. Lesley has also
produced a number of design books and video's over the years as well as been
invited to talk at various women's organisations.
Lesley has also been nominated as the Labone (S.A.B.C.) Women of the year for
2001( South African television ) Creative Image has been featured on national
television by the Small Business Development Corporation. It has also been
highlighted in numerous national magazines.
Creative Image became international in 1999 with studios now in Mauritius and
Namibia.
THE CONCEPT
The idea is to utilise the franchise to establish a craft
painting studio, operating from a home environment with overheads at a minimum.
The studio will run ideally with classes to be made up of housewives in the
mornings, and working ladies in the evenings and weekends. A studio made be run
with as many classes per week as the operator wants but we have found that 6/8
classes per week with 10/12 students per class is ideal..
Craft painting classes are not new, but the establishment of professionally run
studios with set lessons having dynamic designs and ideas for everything (
clothes, wall hangings, bags, trays, cloths, pillow
cases, canvas etc ) is completely unique. If you feel you are artistic you could
start a studio without help, but the advantages of being part of a dynamic group
like Creative Image with its unending supply of designs and ideas, as
well as marketing backup is unique in the industry.
Combine this with over 400 standard products available to you, it makes for a
worthwhile investment in your future.
WHAT DO YOU GET FOR YOUR INVESTMENT IN THE STANDARD FRANCHISE
-
A two year renewable licence. Ongoing franchise fee after two year period is
$100 per month..
-
The use of the name Creative Image Craft Painting Studio.
-
Two years lessons provided completely prepared during your training session and
your time with Creative Image.
-
The right to purchase products at special rates, only available to franchise
holders.
-
Free design service for advertising layouts for your promotions.
-
Assistance with design and layout of your studio..
-
Area demographics for population.
-
Services of head office for month end client demo's that you organise in your
area ,when available
-
Continuous training.
-
All materials supplied at competitive prices.
-
Stock and 10 light boxes to the value of $2000.00.
-
Letterheads business cards and specific advertising material.
-
Assistance with marketing and promotions.
-
Inclusion in all general and national advertising and promotions.
-
Inclusion on the website
-
Student promotion via “online club”
MARKETING
The figures shown in appendices 1 and 2 are based on full classes which should
be achieved after three to four months.
Remember that people will only beat a path to your door if they know where the
door is, and the success of the studio is totally dependent on your personality
and hard work. The advertising for the studio should be started before attending
the training course, so as to have a client base hammering that door down.
Avenues for marketing direction:
-
The franchise studio will be added to all advertising done in conjunction with
the franchiser in woman’s newspapers, craft magazines etc and our regular
newsletters.
-
Local press smalls adverts - effective and inexpensive.
-
Local press editorial - something new in the neighborhood. ( Assistance will be
given in preparing text.).
-
Local store free notice boards.
-
Studio newsletter insertions.
-
Mailing to provided client list, from our data base.
-
Month end free demo's.
-
Pamphlets and posters at local habby and wool stores.
-
Talks to woman’s clubs. (e.g. Rotary Anne's, etc.)
-
Shopping mall promotions.
-
Studio fetes.
-
Flea markets.
FINANCE
The business is
easy to operate with low overheads and high profit margins. The basic concept is
to create a pool of students, i.e. Initially sixty
students, or six lessons of ten pupils each, This can be made up of thirty
students attending twice a week, or sixty individual
students. Each student purchases approximately three
paints per week, with a profit margin of $2.00 per paint.
Each student purchases either a T-shirt, a bag, a shirt or
material to do the lesson on each week, with a profit of
approximately$3.00 per item. Each student also purchases
miscellaneous habby including additional T-shirts,
takkies, beads, bangles ,etc.
Profit in this department is dependent on the
different types of stock you carry, but for this exercise we
have set the figure extremely low.
The figures below are calculated on a 52 week year allowing
for the Christmas holidays. However some studios derive
considerable income by remaining open while the students make
Christmas presents.
|
APPENDIX 1 |
MONTHLY |
YEARLY |
| YEAR 2 |
|
|
| 60 Students per month
@ $150.00 |
$
9000.00 |
$
108.000.00 |
| Anticipated sales of $800.00
during month with a profit of $400.00 |
$ 400.00 |
$
4.800.00 |
| |
|
|
| |
TOTAL |
$
112.800,00 |
This is a full scenario and reflects an approximate income in excess of $7.500.00 per month, but if your studio only does 50% of this, your income would be approximately $4,500.00 or $3,750.00 per month.
Although sixty-five students is your is your target, our studios generally operate with numbers ranging from fifty to sixt-five students dependant on the area. However thirty to thirty-five students is considered enough to make your studio viable.
| APPENDIX 2 |
|
|
Figures based on on a 52 week
year
72 students (i.e. 12 students x 6 classes) @ $120.00 |
|
$ 103.680.00 |
| 72 students x sales with a
profit of $500 per month |
|
$ 6.000.00 |
| *sales to students should be in
excess of $2000.00 per month |
|
|
| Leaving a profit margin of
approximately. |
|
$ 500.00 |
| |
|
|
| |
TOTAL |
$ 109.680,00 |
So, as reflected in the
above figures, by increasing your student level by two
extra per class, you can increase your income by approximately
$22,000 a year, and accordingly for every additional student
your income increases proportionately. These figures
reflect turnover and profit on goods sold. Your
individual overheads will reduce these figures but should
not exceed $100 per month, which is less than 10% of profits.
|
APPENDIX 3 |
|
|
| LESLEY AND RAY'S
ACTUAL CLASSES AT R30 PER LESSON: 1991-1996 |
| in South Africa ( EXCHANGE RATE
6TO 1 ) |
|
|
|
| Figures based on on a 52 week
year |
WEEKLY |
MONTHLY |
YEARLY |
| 16 Students x 6 classes per week |
R 2400.00 |
R 9600.00 |
R 115.200.00 |
| 96 Students x 3 paints per week
@ R 5 profit |
R 1440.00 |
R 5760.00 |
R 69.120.00 |
| 96 Students x miscellaneous
sales |
R 500.00 |
R 2000.00 |
R 24.000.00 |
| 96 .Students x material @ R 3
profit |
R 288.00 |
R 1152.00 |
R 13.284.00 |
| All day classes one per month x
8 students @ R 125 |
|
R 1000.00 |
R 12.000.00 |
| |
|
|
|
| |
|
TOTAL |
R 234.144.00 |
The franchise fee is $20,000.00 (twenty thousand ). This amount is
payable in full before training starts.
Training will be an initial 2 weeks plus additional trainig
scheduled during your training. If you are near an
existing studio, you will be required to attend 4
lessons at your cost to assess your abilities and to ensure that
you are fully aware of what you are buying into, and the
environment in which you will be operating. More
lessons may be required before main training depending
on ability If you wish to secure an area, a deposit of $5,000.00 (five thousand)
is required.( Some franchises have secured their area a year
before starting )
GETTING PAST THE BASICS
This is a basic outline but for a studio but to take
advantage of its potential one needs to maximise the
available time and situation. We have shown you how
the basic works using numbers as a guide only. The actual performance is
directly related to the amount of effort you want to put in.
As an example we have some studios that are operating with in
excess of 100 students .and are selling 3 times the
amount of stock we listed.
Profit margins will also differ dependent on what stock you sell as some
products have a higher profit margin.
This is entirely up to you and the income you want to derive.
You could have 5 morning classes and 5 evening classes
and a Saturday morn/afternoon class you may even wish
to have afternoon classes or run weekend workshops.
All this is dependent on if you want a full time job or a part time job. You
have a possible 27 x 3 hour session times that are useable.
8/9. classes per week with 12
students will give you -/+100 students redo the math
with the figures in the previous examples and you will see that income in excess
of $160,00 per year or $15,000 per month are easily
achievable Its up to you how much you earn.
Selling a studio as a ongoing business.
Once a studio gets established and you are working it
correctly you have a very marketable business. Over
the years we have sold a number of studios as going concerns and the new
operators have gone on to further success. We have had
studios sold buy operators for double what they paid for the
franchise after operating for 5 years so in fact getting back
everything they paid for the franchise.
QUESTIONS
Q. Will I be able to teach?
A. Yes. If you are able to talk to people, we make the lessons so simple,
all you have to do is follow the instructions.
Q. Do I have to be artistic?
A. No just the ability to follow the lesson.
Q. Do I need premises?
A. No, start in the playroom or study in your own house, and progress
to a double garage and develop from there.
Q. Do I need staff?
A. No, very easy for a single person or couple to run.
Q. Can anyone attend classes?
A. Yes, but is best run with ages from 13 to 65 as children have very
short attention spans.
Q. Do you only teach women?
A. No, both women and men attend classes.
Q. How much stock do I need?
A. The greater the variety of stock, the greater the impulse sales, but
approximately $3 000 to $5
000 is adequate once classes are in full
swing.
Q. How do I select stock?
A.
We will advise you based on our actual sales.
Q. Where do I get stock from?
A. All items required will be supplied by CREATIVE IMAGE.
Q. How are payments made?
A. All purchases are COD. (This enables you to keep franchise costs down)
Q. Can I develop my own lessons?
A. The basic programme should be used because of its success rate,
but add in your own ideas as extra project days.
Q. Do I need samples of finished lessons?
A. Yes
Q. Do I have to do all the lessons on items rather then scraps?
A. Yes, as it is more visually appealing and generates sales.
Q. What guarantee do you have of
continuous supply of product and lessons
A. It is within the interest of the franchise to keep you supplied and
motivated
as this is where we derive our income from
Q. What guarantee of success do I have.
A. This is totally dependent on yourself and Creative Image cannot take
responsibility for your inability to work ,the system works as has been proved
by the successful operations we have
Q. What happens after the two year period if I do not wish to carry on as a
franchise
A. you must cease to carry the company logo and use of all company material
which term shall also include all patterns, lessons and designs provided to you will also not be
allowed via restraint of trade to operate a similar
operation
within a fifty kilometre radius for 1 year.