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Entrepreneurship and Small Business

A Project of Business Plan For The EFFOC Coffee (Franchising)

Subject: Entrepreneurship and Small Business Instructor: Mr. Cng Date: April 23rd , 2012 Table of Content

1. Executive Summary and Background. page 4 2. Description of the Management Team page 5 3. Business Objective. page 6 4. Market Approach

4.1 Description of the Target Market page 7 4.2 Uncontrollable Factors.. page 7 4.3 Marketing Strategy. page 8 5. Location 5.1 Trading area page 10 5.2 Specific site page 10 6. Physical facilities. page 14 7. Financial 7.1 Market potential. page 18 7.2 Market share.. page 18 7.3 Projected income...... page 19 7.4 Depreciation Schedule.. page 21 7.5 Financing (Start up costs). page 22 7.6 Cash flow statement . page 23 7.7 Financing. page 24 7.8 Bookkeeping / Accounting System.. page 24 8. Personnel 8.1 Administrative structure. page 25 8.2 Employee Recruitment and Training... page 26 9. Legal Requirement 9.1 Legal Structure page 28 9.2 Licensing.. page 28 9.4 Tax page 29 Executive Summary and Background

The EFFOC coffee is a franchising brand. This brand was found in 2008 and now, it has 4 coffee shops in Ho Chi Minh City. Therefore, we have decision to establish a EEFOCT coffee shop in Go Vap district to meet customers demand and operate this brand The EFFOC coffee had origin which is "coffee to go" (take away) for customers. However, Our business evaluate the competition ability of this brand based on information and data of franchisor so we decided to open a coffee shop which has Group8- The EFFOC coffee business plan Page 2

98 square met and 2 floors for servicing customers with 2 major of kinds (take away and at shop) Our coffee shop locates on Nguyen Thai Son Street, Go Vap district. It nears university, high schools, market, offices. Thus, it can attract more customers The EFFOC coffee shop will be operated by the conditions of franchisor; actually, we have an contact between franchisor and franchisee about training, profit, supplying, brand cost and so on The EFFOC coffee is used material from Italy and Italian formulation with suitability prices for Vietnamese consumers. The coffee shop like take away coffee, this is a kind of coffee, buyer can buy it and bring their home to enjoy it or they can enjoy at shop

Description of Management Team


The new EFFOCT coffee in Go Vap district is established from equity from 6 shareholders and they own this shop. The profit of shop will share 6 parts with particular proportion. In there, the first owner and manager of this shop is Nguyen Hieu Ngoc. She graduated Business Administration from SIAST Canada. This program is evaluated highly in international cooperation programs of Viet Nam. She has 2 years of Group8- The EFFOC coffee business plan Page 3

experience in selling and marketing in Mead Johnson Co. and Abbout Co. After that, this is a list of all shareholders who will manage this coffee shop with Ms. Ngoc in the next time: Tran Thi My Linh - Human resource manager She graduated Business Administration from SIAST Canada, she has 1 year in training and human resource management in TGM Corporation Le Hoang My Marketing manager He has the degree of Diploma Business Administration about Marketing in HCM City University of industry. Also, he has also experiences of working in marketing department for Nike Viet Nam Company Dang Thi Cam Thuy - Financial Manager She graduated Business Administration from SIAST Canada, she had 2 years in selling in family business Nguyen Quoc Tuan Marketing department He has the degree of Diploma Business Administration. He had 3 years as assistance in family business Truong Thi Thanh Ngoc - Human resource department She has the degree of Diploma Business Administration. She had 2 years assistance in volunteer for foreign coffee shop In the fact that, 6 shareholders divide time and job management of shop, because they has their own job and depend on free time of person for shop management

Business Objectives
The objectives for EFFOC coffee shop are following: The first objective is attracting customers by our special coffee from Italy; contribute a good brand in customers mind with good service style The second relates the profits of this coffee shop. Although each member just contribute one-sixth of business but they hope can have return as soon as possible ( about 18 months) and after that they gain profit higher than in stock or bond Group8- The EFFOC coffee business plan Page 4

investment in financial market with the same budget The third is based on performance that is a medium-term goal. Market share should increase about 8% for each year in 5 years. We hope that the business grows, it will have loyal customers and the brand reputation to overcome threaten when our business's new in Go Vap district The fourth is the long-term goals after 5 years this shop still exists. We will franchise 3 or 5 coffee shops in other districts such as Binh Thanh, Tan Binh, 8, 4 and 2 to cover all located in Ho Chi Minh City

Market Approach
1. Description Of The Target Market The geographic market area for EFFOC coffee shop is required by franchisor. However, because it is take a way of coffee shop so it needs to located lethebridge for convince when customer waiting and purpose of advertising reputation brand Geographic: focus on center of district, which has a lot of schools, university, offices Group8- The EFFOC coffee business plan Page 5

Demographic: It is also targeting the low, medium and high income people and it is purchased by both genders, either male or female. The main age frame for the target market is from 15 to 60 years old. Particularly: Teenagers Students Officers Foreigners People who like mix-drinking from Italy Psychographic: People who like the special coffee with weird favors which made from Cookie, Chocolate, Cappuccino, Mocha, Smoothies, Tea, and so on target is focus on low , medium and high income because our coffee glass is cheaper than other with Italy formula Behavoiur: The consumers personality who love Italy coffee Have habit drink coffee everyday Need a place to talking & chatting with friend , can enjoy drinking Love Italy coffee or mix-drinking

2. Uncontrollable Factors There are 4 uncontrollable factors that the small business owner must understand: Economy: At this point, the economy in Vietnam is restored. The business inside and outside trend reinvestment Vietnam market. Therefore, they need a proficient human resource. Moreover, quality of products is vital too. Competition: There are several coffee shops and milk tea shop so the market seems saturation; thus, we need to contribute reputation brand to attract consumers Legal Restrictions: Partnership with 6 members so this is hard in taxes and not major owner so legal document has some complication Social/Cultural Trends: Because Vietnamese cultural people like the traditional coffee so its difficult to bring a new coffee & drinking for them. and the kind of products is not various; thus, the customer

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3. Marketing Strategy (4P) Product:

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Distribution (Place): Now, The EFFOC coffee has 4 shops in Ho Chi Minh City and a new shop in Go Vap district which is established by us Store 1: Effoc V Th Su 14a V Th Su 08 66 789 563 Effoc Nguyn Vn Trng 29 Nguyn Vn Trng 08 66 793 436 Effoc Nguyen Thuong Hien

Store 2:

Store 3:

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369 Nguyen Thuong Hien 08 66 725 549 Store 4: Effoc Tran Quoc Toan 3 Tran Quoc Toan Street, District 3 08 62 551 555 Effoc Nguyen Thai Son 148 Nguyen Thai Son, Go Vap District

Store 5:

Price: The price fluctuates from 24.000 VND to 32.000 VND which depends on the kind of drinking See the Menu picture following:

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Promotion: To attract and let the consumers know a new store. Franchisor will support us give Voucher in other 4 coffee shop. When customer give Voucher in EFFOC coffee shop to exchange 5 cups in any EFFOC store to take 1 cup free (the program will held in a month) The every promotion in year in summer, because in summer, almost students and high school students will off in school so we have promotion to earn points which Group8- The EFFOC coffee business plan Page 12

can change a EFFOC glass

4. SWOT: Strengths Italian Coffee with low price Reputation brand due to franchising Save advertising cost New favours coffee to attract curious of customers Weakness Just have drinking, not food Limited kinds of drinking Not famous in Go Vap district

Opportunities Location near schools, offices attract customer easily Weird favour to demand customers need

Threatens Saturation market ( have a lot of competitors) Some people likes Vietnamese traditional coffee

Location
1. Trading Area Economic Base: Ho Chi Minh City has 14 districts and has total surface of 2,095.01 km. Go Vap District is a district of Ho Chi Minh City. The process of rapid urbanization has made Group8- The EFFOC coffee business plan Page 13

the Go Vap district became one of the three growth rate the highest population of the city. Specifically, in 1976, with 144 thousand residents of Go Vap, then in 1995 was 223 thousand, 231 thousand in 2000 and 2003 were 413 thousand and 455 thousand in 2004. As from 1980 to 2003, the population of Go Vap increased 2.87 times, average 13.66% increase per year. According to census population 01/04/2009 Go Vap district is 515,954 people. Population: 515.954 (Census 1/4/2009) Density: 24.640 people /km

Competition: In terms of general coffee shop competition in the trading area in Go Vap district, there are about 150 coffee shops and they have been evaluated at a total of 12,000 square meter (150 x 80 square meter) Attitudes Of The Trading Area Toward Having A New Business The new coffee shop has increased the trading area and has shown a positive attitude toward development of the area. Therefore, establishing coffee shop in Go Vap District area is good and satisfied of that anxiety. In addition,it is convenient because it is near a center of Go Vap district 2. Specific Site Accessibility We choose a house for rent which located 196C Nguyen Thai Son with Lethbridge is 98 square meter, 2 floors and cost is 15 million VND for each month. This place is very convenient because its near market, offices, schools and university. Moreover, this house just need fix and decorate something so it helps business save fixing cost Site Costs The specific site costs prediction includes the following: Price Rent 135.000.000 VND per year Utilities 12.000.000 VND per year Telephone 6.000.000 VND per year Business Taxes 24.555.182 VND ( 98.220.728 x 0.25) Group8- The EFFOC coffee business plan Page 14 per year 25% of Profit City Business License 1.000.000 VND per year Item

Total

178,555,182

The site area is 98 square meter (7 x 14) with 2 floors. The contact will be signed with 5 year. Moreover, the rent expense is 15.000.000 VND for each month in the first year. After first year, the rent expense will increase 1.000.000 VND every year by hosts requiring. By this mean, - The second year is 16.000.000 VND for each month - The third year is 17.000.000 VND for each month - The fourth year is 18.000.000 VND - The fifth year is 19.000.000 VND Restriction: Limited 5 years for rent & pay first 3 months for host Site history: the shop was a grocery store in 5 years so can attract more consumers or contribute the noticing Proximity to other businesses: near 7 coffee shops and 3 milk tea shops

The Figure 1: Selling Space

Floor 1 Floor 2

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The Figure 2 : The EFFOC coffee shop in designing 3D:


1st Floor:

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2nd floor:

Physical Facilities
Equipment, fixtures, and supplies are an integral part of business and list of these items is included below. The costs have been obtained from prospective suppliers.

Equipment Group8- The EFFOC coffee business plan Page 18

Item Bar Coffee machine Blender machine Fringe Shelf Sink Cash machine Water Filter Others Set of Tables & Chairs Air Conditions Salon & coffee table Sound Television 32inch Telephone Uniform Fixing & Decoration Computer

No. 8m 1 3 2 2 1 1 2

Each 2,500,000 70,000,000.00 10,000,000 8,000,000 3,000,000 2,000,000 10,000,000 500,000

Total Value 20,000,000 70,000,000 30,000,000 16,000,000 6,000,000 2,000,000 10,000,000 1,000,000 5,000,000 30,000,000 28,000,000 30,000,000 5,000,000 16,000,000 200,000 2,000,000 15,000,000 7,500,000

Furniture and Fixtures 25 1,200,000 4 7,000,000 3 10,000,000 5,000,000 2 8,000,000 1 200,000 20 100,000 15,000,000 1 7,500,000

Total

293,700,000 VND

The Figure 3: Layout EFFOC Coffee Shop


1st Floor

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2nd Floor

Financial
Feasibility Analysis 1. Market Potential: - The estimate of average each person expenditure on eating, drinking and entertainment on survey is about 1.500.000 VND for each month Group8- The EFFOC coffee business plan Page 20

- The population in Go Vap district for the target market is consisting of approximately 515.954 in 2009 (source: http://www.govap.hochiminhcity.gov.vn) Using a percentage of 10 percent of total expenditure for drinking in Go Vap district Our business estimated 15 percent should be conservative as The EFFOC coffee shops revenue - The market potential estimate is as follows: Population x each person expenditure x percent of expenditures for target market = (515.954 x 20%) x (15.000.000 VND x 10%) = 154.786.200.000 VND 2. Market Share: The number of all Coffee shop in Go Vap district is about 150 coffee shops and the average area is 80 square meter on prediction and statistic by experience An estimate of EFFOC coffees proposed market share is shown below:

This share should be decrease to 0.8 % because of the fact that the EFFOC coffee is new and will take some time to build revenues. The start - up delay should not be significant; however, the EFFOC coffee is quite famous Italian coffee so itll gain potential market share easily Projected share in revenue = market share x market potential = 0.8 % x 154.786.200.000 VND = 1.238.289.600 VND

3. Projected Income: Below are the projected income statements for the first five years of operation. Revenue figures from above are used as the basis behind this information, which was provided by franchisor of EFFOC coffee for a new store. Amounts and sources of expenses are as follows: - Cost of Goods Sold 35% of sales (by franchisor)

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- Wages and Salaries - Depreciation - Repairs and Maintenance - Utilities - Phone - Rent - Legal fees - Advertising & Promotion - Business Taxes - Other Expenses

1.700.000 VND for each employee See schedule for calculation 10.000.000 VND for each year 12.000.000 VND for each year 6.000.000 VND for each year 15.000.000 VND for each month for the first year (And increase 1.000.000 each year) 1.000.000 VND 10.000.000 VND for each year (by franchisor) 25 % of profit (Taxation Department of City) 2% of Revenue (by franchisor)

The projected income for EFFOC coffee is found below.

Percent of sales, revenue, cost, salaries and others will increase about 1.5 for each year

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Items Sales (VND) Cost of goods sold (VND) Gross Margin (VND) Expense: Wage & Salaries (VND) Depreciation (VND) Repairs and Maintenance (VND) Utilities (VND) Phone (VND) Rent (VND) Legal Fee (VND) Advertising (VND) Business Taxes (VND) Other expense (VND) Total Expense (VND) Net Income (VND) VND => USD ($)

Year 1 1,238,289,600 433,401,360 804,888,240 351,600,000 18,430,000 10,000,000 12,000,000 6,000,000 180,000,000 1,000,000 10,000,000 201222060 8048882.4 798,300,942 6,587,298 316.544815

Year 2 1,857,434,400 650,102,040 1,207,332,360 527400000 18,430,000 10,000,000 12,000,000 6,000,000 192,000,000 1,000,000 10,000,000 301833090 12073323.6 1090736414 116,595,946 5602.880654

Year 3 2,786,151,600 975,153,060 1,810,998,540 791100000 18,430,000 10,000,000 12,000,000 6,000,000 204,000,000 1,000,000 10,000,000 452749635 18109985.4 1523389620 287,608,920 13820.70733

Year 4 4,179,227,400 1,462,729,590 2,716,497,810 1186650000 18,430,000 10,000,000 12,000,000 6,000,000 216,000,000 1,000,000 10,000,000 679124452.5 27164978.1 2166369431 550,128,379 26435.77027

Year 5 6,268,841,100 2,194,094,385 4,074,746,715 1779975000 18,430,000 10,000,000 12,000,000 6,000,000 228,000,000 1,000,000 10,000,000 1018686679 40747467.15 3124839146 949,907,569 45646.68761

4. Depreciation Schedule:

Item Bar (VND) Coffee machine (VND) Blender machine (VND) Ice machine (VND) Fringe (VND) Shelf (VND) Sink (VND) Cash machine (VND) Water Filter (VND) Tables & Chairs (VND) Air machine (VND) Salon & coffee table (VND) Television 32inch (VND) Telephone (VND) Computer (VND) Total

Equipment No. Each 15m 2,800,000 1 70,000,000.00 3 10,000,000 1 30,000,000 2 8,000,000 2 3,000,000 1 2,000,000 1 12,000,000 2 500,000 25 7 3 3 1 2 1,200,000 7,000,000 12,000,000 10,000,000 200,000 7,500,000

Total Value Life (years) 42,000,000 20 70,000,000 10 30,000,000 10 30,000,000 10 16,000,000 5 6,000,000 20 2,000,000 5 12,000,000 5 1,000,000 5 Furniture and Fixtures 30,000,000 20 49,000,000 5 36,000,000 30,000,000 200,000 15,000,000 20 5 5 5

1 to 5 10,500,000 35,000,000 15,000,000 15,000,000 16,000,000 1,500,000 2,000,000 12,000,000 1,000,000 7,500,000 49,000,000 9,000,000 30,000,000 200,000 15,000,000 218,700,000

Year 6 to 10 10500000 35,000,000 15,000,000 15,000,000 0 0 0 0 0 7,500,000 0 9,000,000 0 0 0 92000000

11 to 15 10500000 35,000,000 15,000,000 15,000,000 0 0 0 0 0 7,500,000

16 to 20 10500000 35,000,000 15,000,000 15,000,000 0 0 0 0 0 7,500,000

9,000,000 0 0 0 92000000

9,000,000 0 0 0 92000000

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5. Financing: Start up costs are found below Item Initial equipment & fixtures & other thing (VND) Rent (required pay first 3 month) (VND) Utility deposit (VND) Legal fees (VND) Advertising and promotion ( first 3 month) (VND) Total Start-up cost Cost 293,700,000 45,000,000 1,000,000 1,000,000 2,520,000 343,220,000 Source See physical facilities section See location section See location section See Legal section See Promotion section

6. Cash Flow Statement

Quarter Endings CASH INFLOWS Sales Equity Investment TOTAL CASH INFLOW CASH OUTFLOWS Equipment & Supplies Inventory Wages & Salaries Advertising Legal fee Business Taxes Rent Repair & Maintenance Utilities Telephone Other Expense TOTAL CASH OUTFLOW NET CASH INFLOW

30-Jun 309,572,400 0 309,572,400 293,700,000 108,350,340 30,200,000 6,000,000 1,000,000 0 45,000,000 2,500,000 3,000,000 1,500,000 6,191,448 497,441,788 -187,869,388

30-Sep 309,572,400 0 309,572,400 0 108,350,340 30,200,000 2,000,000 0 45,000,000 2,500,000 3,000,000 1,500,000 6,191,448 198741788 110,830,612

31-Dec 309,572,400 0 309,572,400 0 108,350,340 30,200,000 2,000,000 0 45,000,000 2,500,000 3,000,000 1,500,000 6,191,448 198741788 110,830,612

31-Mar 309,572,400 0 309,572,400 0 108,350,340 30,200,000 2,000,000 0 45,000,000 2,500,000 3,000,000 1,500,000 6,191,448 198741788 110,830,612

7. Financing The start-up cost for the EFFOC coffee shop is 343,220,000 and we will plus 40% of start-up cost as another cost for time return: 343,220,000 + (343,220,000 x 0.4) = 480,508,000 So the equity investments are divided 6 parts with the following proportion:

Name
Nguyen Hong Ngoc Nguyen Quoc Tuan Tran Thi My Linh Le Hoang My Truong Thi Thanh Ngoc Dang Thi Cam Thuy

Percentage Investment on Profit


25% of Cost 15% of Cost 15% of Cost 15% of Cost 15% of Cost 15% of Cost

The financial investment on proportion


120,127,000 VND 72,076,200 VND 72,076,200 VND 72,076,200 VND 72,076,200 VND 72,076,200 VND

There is example of financial budget for Nguyen Hieu Ngoc who has the highest percentage investment (25%) - he makes a loan in ACB bank with a contact has interest rate is 20% in each years, she was invested 20,127,000 and was borrowed 100,000,000 from bank (120,127,000 20,127,000) x 0.2 = 20,000,000 VND

her return:

If he has financial budget, she wouldnt make loan from bank. And

8.

Bookkeeping / Accounting System

The computer system that will be purchased and take care of all aspects of the coffee shop, including the financial aspects. The accounting software program for small business will utilized to monitor and evaluate performance. Monthly financial statements will be prepared and received by Nguyen Hong Ngoc. The payment for this coffee shop is only accepted by cash. There will be no credit granted.

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Personnel
1. Administrative structure: The EFFOC coffee is joint-stock including 6 shareholders. Moreover, Nguyen Hong Ngoc invest 25% of total capital ,5 remaining owners invest 15% of total capital so Nguyen Hieu Ngoc play a role as boss and other investors are manager In addition, Time management of investors is divided 6 parts of time. In particularly, Schedule of managers Tuesday Tuan T.Ngoc H.Ngoc Wednesday Thuy Linh My Thursday Tuan T.Ngoc H.Ngoc Friday Thuy Linh My Saturday Tuan T.Ngoc H.Ngoc Sunday My H.Ngoc Linh - Thuy T.Ngoc - Tuan

Time 8h to 13h 13h to 17h30 17h30 to 10h

Monday Thuy Linh My

The organizational chart for the staff can be seen below:

Boss (H.Ngoc) Manager (Linh)

Manager (Tuan)

Manager (My)

Manager (T.Ngoc)

Manager (Thuy)

The basic profit of Coffee shop will be divided by following:

Name

Percentage Investment on Profit

Return of Investor
24,550,182 14,730,109.2 14,730,109.2 14,730,109.2 14,730,109.2 14,730,109.2

Nguyen Hong Ngoc 25% of Profit Nguyen Quoc Tuan 15% of Profit Tran Thi My Linh 15% of Profit Le Hoang My 15% of Profit Truong Thi Thanh Ngoc 15% of Profit Dang Thi Cam Thuy 15% of Profit 2. Employees Requirement and Training Group8- The EFFOC coffee business plan Page 29

Job Description: Time WorkingStore hours for the EFFOC will be as follows: Monday Friday, 8:00a.m 10:00p.m Saturday & Sunday, 8:30a.m- 10:30p.m Duties:

Employees have a mission like welcoming customers, serving drinking, care about customers opinion Any employees can be bartender because franchisor will train all employees So 2 employees have responsibility as bartender (experience is preferred) and 5 employees as servicer 1 security people has responsibility as taking and caring customers motorbike 1 worker has responsibility as cleaning tables, toilet. Requirement:

All employees have to train except worker and security Have a right manner with customers Always smiling & welcoming customers Friendly, greets, care customers, good communication, carefully Recruitment:

Through advertising (Students are preferred) Interviewing applicators

Salaries and Wages: Position Employees ( bartender & servicer) Worker Security Number of Employees 14 1 1 Hours 7 ( part-time) 14 (full-time) 14 (full-time) Salaries (VND) 23.800.000 (1.700.000 x 14) 2.500.000 3.000.000

Total

16

29.300.000 VND

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Policies: Go to work and go home in time Must to wear the store uniforms Trial working in the first 3 months The customers are always right Employees work in 1 year for the coffee shop that will receive a gift depends on reasonable expectations of employees in their birthday

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Legal Requirements
1. Legal Structure
Internal Business Nguyen Hieu Ngoc will be as representative for 5 other investors to register contact with Franchisors of EFFOC coffee. Moreover, Nguyen Hong Ngoc have to create contact with 5 other investors Small Business and the owners are shareholder so we will use the Legal Structure as PARTNERSHIP. And we will use the second type of partnership that is General Partnership. Heres advantages & disadvantages of business

Advantages
Simple and inexpensive to start Pooling of financial and skill resources Tax advantage Unlimited liability

Disadvantages
Death of a partner terminates the partnership unless a provision to the contrary is specified in the partnership agreement Greater possibility for disagreements (buy-sell agreements should be drawn up in the event that a partner wants to leave the business)

1) 2) 3) 4) 5)

To solve all disadvantages, we should create an appropriate partnership agreement includes the following provisions:

Duration of the partnership Administrative responsibilities and authority of each partner. Withdrawals and salaries of the partners. Provision for the arbitration of policy disputes among the partners. Provisions for the withdrawal of partners or the admission of additional partners. 6) Amount of capital invested by each partner. 7) Division of profit or loss. (Regardless of the amount of capital invested, general partners must share profit or loss equally unless there is an agreement among the partners to the contrary). 8) Distribution of assets in the event of dissolution. ( As in the case of profits or losses, this distribution must be on an equal basis unless otherwise agreed on in writing). Group8- The EFFOC coffee business plan Page 32

9) Settlements in the event of death or disability of a partner. This might include a buy-sell agreement funded with business life insurance in amounts equal to the interest of each partner; thus surviving partner(s) would be assured of full title to the business, and the deceased partner's estate would be assured of receiving the full value of his or her share of the business. In the absence of such an agreement, the business might well be forced into liquidation to satisfy demands of the deceased partner's estate.

Investigate the Legal Requirements (External Business) 1. Registration and disclosure with Commercial Agencies or Ministry of Trade. Registration form includes: - Application for franchise operations form of the Ministry of Commerce - The introduction of the franchise from - A copy of the certificate of business registration or investment certificate, for foreign franchisors can replace it with other papers of equivalent value - A notarized copy protection of industrial property rights in Vietnam or in foreign countries in case of transfer of rights to use for objects of industrial property rights have been granted protection titles

2. The required business licenses and incorporation *Registration in Department of Planning and Investment Ho Chi Minh City 3. Other laws regulating the operations of franchises These are individual clauses which are required in franchise agreements: 1. Term and Renewal 2. Site Selection 3. Franchisor Approval of Lease 4. Exclusive Territory 5. Trademark Restriction 6. Training by Franchisor 7. Franchisor Help with Operating 8. Operating Manual 9. Advertising by Franchisor Group8- The EFFOC coffee business plan Page 33

10. Advertising by Franchisee 11. Advertising, Control of 12. Royalty 13. Franchisor - Right to Inspect 14. Franchisor - Right to Audit 15. Standard of Cleanliness 16. Standard of Operations 17. Noncompetition 18. Confidential Information 19. Permitted Incorporation 20. Termination by Franchisor 21. Termination by Franchisee 22. Right of First Refusal 23. Sale Approval by Franchisor 24. Sale of Equipment to Franchisor

2. Licensing
The licenses necessary to operate this college are as follows : Name of Licensing Business license Franchising fee Total Fee 1.000.000 VND per year 30.000.000 for one 31.000.000 VND

3. Tax
This is a joint stock company. Because it operate following adulation pattern, it dont incur GST tax .The kinds of other taxes which it must pay per month such as : Name of Tax Business license Business Tax Fee 1.000.000 VND 25% of profit

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