UK based Private Equity firm TLG Capital has invested $4.46 Mn(Rs 20.5 Crore) for a 36% stake in Re-feel Cartridge Engineering Pvt Ltd in its first Indian private equity deal. The deal values the startup which provides printer cartridge refill and laptop repair services at $12.40 Mn(Rs 57 Crore).
The funds will be used by Re-feel for expanding its franchisee network and expanding its laptop repair business. TLG Capital’s Sidarth Menon has been appointed chief financial adviser at Re-feel Engineering.TLG is also planning to replicate Re-feel’s overall business model in sub-Saharan Africa due to the similarities it sees between the two markets.
In 2008, Bennett, Coleman & Co Ltd (BCCL), publishers of ‘The Times of India’ and ‘The Economic Times’, had completed a private treaty deal with Refeel Cartridge. As part of the deal, BCCL has invested around Rs 15 crore in the company.
Refeel Cartridge was floated in February 2007 but the first store was set up only in August 2007.The company claims refilling inkjet cartridges at their store will enable price saving of 75% than buying an OEM cartridge and 60% for laser cartridges. Little wonder, the company has more than 50 corporate clients.
Refilling printer cartridges is a way by which companies can cut their printing costs by at least 50-60%. Typically, a large organisation has a printing budget of around Rs 5-7 lakh per month.Around 40% of our revenue is expected from the enterprise segment and the balance from the small office home office (SOHO) and retail customers said an official from Re Feel Cartridges.
Re Feel Engineering also owns the Club Laptop franchisee which operates in the laptop service segment.Club Laptop offers a one stop solution for laptop repair and laptop accessories.
Tags:refeel cartridge, refeel franchise,franchisee, franchisee network, laptop repair franchise, sidharth menon, TLG Capital, Franchise Funding, Franchise Venture,service franchise.
Source:India Micro Finance.July 28, 2010.
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Showing posts with label franchisee. Show all posts
Showing posts with label franchisee. Show all posts
Wednesday, July 28, 2010
Thursday, April 1, 2010
India Footwear Biggie M&B Plans Franchise Growth For FY 2010-2011
M&B Footwear goes the franchisee way
Thursday, 01 April 2010 07:05
M&B Footwear, the footwear retail chain, with multiple footwear franchise brands is planning to expand its retail presence through the franchise route in metros, mini metros and smaller cities and towns. Vikas Bagga, VP, marketing and corporate affairs, M&B Footwear says that, most of the franchised stores will be in north, notably Punjab and adjoining belt, and east in the first phase. Some of the outlets will be operational before the end of the first quarter of the financial year 2010-11. The endeavor is to set up moderate to mid-sized walk-in M&B stores, spread over 500-1,000 sq. ft. of carpet area, in premium malls and high street locations. Bagga also says that, the property lease for nine years would have to be directly secured by the franchisee else the franchisee could offer and operate out of their wholly-owned premises. The franchisee will have to invest close to Rs 10 to 15 lakh on fixtures and fittings and Rs 20 to 25 lakh in stock inventory.
The retail chain’s franchise route is being perceived as futuristic as it would ensure it franchise expansion plan. M&B plans to set up 15-20 walk-in outlets. The brand offers an array of distinctive international and national lifestyle footwear brands including Lee Cooper, Geox, ID, Provogue, Merrell and Firangi. Currently, it has 41 exclusive concept stores, located in premium malls and high streets, 97 shop-in-shops with large format stores such as Westside, Pantaloons, Shoppers Stop and Central and 62 factory showrooms in India.
Thursday, 01 April 2010 07:05
M&B Footwear, the footwear retail chain, with multiple footwear franchise brands is planning to expand its retail presence through the franchise route in metros, mini metros and smaller cities and towns. Vikas Bagga, VP, marketing and corporate affairs, M&B Footwear says that, most of the franchised stores will be in north, notably Punjab and adjoining belt, and east in the first phase. Some of the outlets will be operational before the end of the first quarter of the financial year 2010-11. The endeavor is to set up moderate to mid-sized walk-in M&B stores, spread over 500-1,000 sq. ft. of carpet area, in premium malls and high street locations. Bagga also says that, the property lease for nine years would have to be directly secured by the franchisee else the franchisee could offer and operate out of their wholly-owned premises. The franchisee will have to invest close to Rs 10 to 15 lakh on fixtures and fittings and Rs 20 to 25 lakh in stock inventory.
The retail chain’s franchise route is being perceived as futuristic as it would ensure it franchise expansion plan. M&B plans to set up 15-20 walk-in outlets. The brand offers an array of distinctive international and national lifestyle footwear brands including Lee Cooper, Geox, ID, Provogue, Merrell and Firangi. Currently, it has 41 exclusive concept stores, located in premium malls and high streets, 97 shop-in-shops with large format stores such as Westside, Pantaloons, Shoppers Stop and Central and 62 factory showrooms in India.
Thursday, March 4, 2010
Budget 2010: What it brings to the franchise industry
With most of the market signals remaining positive with Union Budget 2010-11, consumer is happy being at the center stage of consumption story and is in a better position than a year ago. However, challenges remain. Read on to know what is in platter for for the SMEs and franchise industry.
Franchise industry has been looking forward several regulatory as well as policy reforms to facilitates its growth. A positive GST outlook by government and rise in threshold for tax compliances has been seen as a very positive move by the franchise industry. However the long impending demand of abolishing dual taxation on the franchise services has been clearly ignored by the policy makers. Presently both service tax as well as VAT are imposed upon the franchise services which distorts the franchise model completely.Morover service tax on rental proceed further makes deters the profitable feasibility. In all it has been the budget has been moderately favorable for the franchise industry. Gaurav Marya ,President, Franchise India Holding Ltd shares’’ The budget 2010-11 brings a reasonable assortment for small retailers as well as franchisors. While increased income tax exemption limits will certainly boost consumption, imposing service tax on rental property distorts retail business models by making the accessibility of retail spaces precipitously expensive, hence making it unviable to sustain profitably.'
According to D P S Kohli, Chariman, Koutons Retail India Ltd, ‘Overall, it has been a mixed budget for us. New tax slabs and rates have been introduced which would offer 60 per cent relief to the tax payers providing them with greater disposable income. This would provide the necessary boost to consumer’s spending a pre-requisite to unleash the true growth momentum of the retail sector.
In addition, reduction of surcharge on domestic companies that the finance minister has announced is sure to accelerate the expansion plans for the retail players at home. However, industry status continues to delude the retail sector. This is a disappointment since this is the first step towards reforming the sector and organising the highly unorganised sector. The hike in the excise duty is also not favorable for us since this might directly affect the quality of production.
Badrinath, Director, Accretive Global stated that the budget has both the shades of gray and white for the franchise industry he further explains detail implications
The good news
No change in service tax rates and the same continues at 10.3 per cent. The FM in his budget speech states that this proposal is “to maintain the growth momentum and also to bring about a convergence in the rates of tax on goods and services.”
Small businesses stand benefited on account of lower direct tax compliance costs. The threshold for having the accounts audited for tax has been increased from 40 lacs to 60 lacs. Further, small businesses with turnover/receipts lower than 60 lacs can also choose to be covered by the presumptive tax system. The threshold earlier was only 40 lacs.
The frequency of remittance of central excise is extended to quarterly basis from the current scheme of monthly payments for units operating under the SSI Scheme.
As a welcome step, exemption from 4 per cent special additional duty of customs is granted to mobile phones, watches and garments imported in pre-packed condition for retail sale.
The not so good news
The FM has retrospectively amended the provisions relating to levy of service tax on renting of immovable property. The judgment of the Delhi High Court in the case of Home Solutions Retail is negated by making mere renting of immovable property liable to service tax.
Further, much against the industry expectations, the FM has retained the CST at 2 per cent and the base rate of excise is increased from 8 per cent to 10 per cent.
The FM has extended service-tax on health check-up services provided to employees of a business-entity or persons covered under health-insurance-schemes if such payment is made by the business entity or insurance company. This is likely to increase the cost of healthcare services. However, if carefully managed, the franchisee in this sector could claim credits of service tax paid on various input services such as renting of immovable property and franchisee fee which is currently adding to the cost of the operations. This could reduce the net price impact for the end consumer.
As the franchise industry brings with its surge innovative new franchise business models to tap the potential of Indian consumption, it also demands a favorable ecosystem which can be realized by necessary monetary policy reforms.
Franchise industry has been looking forward several regulatory as well as policy reforms to facilitates its growth. A positive GST outlook by government and rise in threshold for tax compliances has been seen as a very positive move by the franchise industry. However the long impending demand of abolishing dual taxation on the franchise services has been clearly ignored by the policy makers. Presently both service tax as well as VAT are imposed upon the franchise services which distorts the franchise model completely.Morover service tax on rental proceed further makes deters the profitable feasibility. In all it has been the budget has been moderately favorable for the franchise industry. Gaurav Marya ,President, Franchise India Holding Ltd shares’’ The budget 2010-11 brings a reasonable assortment for small retailers as well as franchisors. While increased income tax exemption limits will certainly boost consumption, imposing service tax on rental property distorts retail business models by making the accessibility of retail spaces precipitously expensive, hence making it unviable to sustain profitably.'
According to D P S Kohli, Chariman, Koutons Retail India Ltd, ‘Overall, it has been a mixed budget for us. New tax slabs and rates have been introduced which would offer 60 per cent relief to the tax payers providing them with greater disposable income. This would provide the necessary boost to consumer’s spending a pre-requisite to unleash the true growth momentum of the retail sector.
In addition, reduction of surcharge on domestic companies that the finance minister has announced is sure to accelerate the expansion plans for the retail players at home. However, industry status continues to delude the retail sector. This is a disappointment since this is the first step towards reforming the sector and organising the highly unorganised sector. The hike in the excise duty is also not favorable for us since this might directly affect the quality of production.
Badrinath, Director, Accretive Global stated that the budget has both the shades of gray and white for the franchise industry he further explains detail implications
The good news
No change in service tax rates and the same continues at 10.3 per cent. The FM in his budget speech states that this proposal is “to maintain the growth momentum and also to bring about a convergence in the rates of tax on goods and services.”
Small businesses stand benefited on account of lower direct tax compliance costs. The threshold for having the accounts audited for tax has been increased from 40 lacs to 60 lacs. Further, small businesses with turnover/receipts lower than 60 lacs can also choose to be covered by the presumptive tax system. The threshold earlier was only 40 lacs.
The frequency of remittance of central excise is extended to quarterly basis from the current scheme of monthly payments for units operating under the SSI Scheme.
As a welcome step, exemption from 4 per cent special additional duty of customs is granted to mobile phones, watches and garments imported in pre-packed condition for retail sale.
The not so good news
The FM has retrospectively amended the provisions relating to levy of service tax on renting of immovable property. The judgment of the Delhi High Court in the case of Home Solutions Retail is negated by making mere renting of immovable property liable to service tax.
Further, much against the industry expectations, the FM has retained the CST at 2 per cent and the base rate of excise is increased from 8 per cent to 10 per cent.
The FM has extended service-tax on health check-up services provided to employees of a business-entity or persons covered under health-insurance-schemes if such payment is made by the business entity or insurance company. This is likely to increase the cost of healthcare services. However, if carefully managed, the franchisee in this sector could claim credits of service tax paid on various input services such as renting of immovable property and franchisee fee which is currently adding to the cost of the operations. This could reduce the net price impact for the end consumer.
As the franchise industry brings with its surge innovative new franchise business models to tap the potential of Indian consumption, it also demands a favorable ecosystem which can be realized by necessary monetary policy reforms.
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