a) The information kit contains all the details Isabella Hallberg needs.
b) Overseas franchisees do not have to stock a full range of Body Care products.
c) Export liquid products are bottled and labeled in the US.
d) Overseas franchisees are not charged the annual franchise operating fee.
e) With new overseas franchisees, Body Care is more concerned with establishing a market rather than making profits.
FILE TWOŒFifteen months later, Isabella Hallberg completes her first year of work as a franchisee for Wendy Rae Body Care Centers. Her center in downtown Stockholm has grossed $334 000 in the period, and her plans to open a second store in Stockholm and another in Malmö are well advanced. The central management is impressed. They invite her to become the head franchisee for Scandinavia. She declines on the grounds that she has insufficient business experience. With encouragement from Wendy Rae herself, Isabella Hallberg eventually changes her mind.
ŒŽBody Care does not allow its head franchisees to begin sub-franchising until they have two or more stores and a record of two years' successful trading. Three months after becoming head franchisee for Scandinavia, Isabella Hallberg meets Margareta Tntz, who has a chain of four pharmacies in Oslo and Bergen. Ms Tntz wants to close her stores and reopen them as Body Care Centers. Isabella Hallberg writes to the Franchise Manager in Santa Monica requesting an exception to the regulations.
Read the letter.
The Wendy RAe Body Care Center SKIN & HAIR CARE PREPARATIONS
Scott Ringer
Franchise Manager
Wendy Rae Body Care Centers Inc
2202 Willshire Boulevard
Santa Monica, California 90403 17 May, 19..
Dear Mr Ringer,
I am writing to ask if it is possible to arrange an exception to the clause in our agreement which prevents me from sub-franchising at present.
I have met a potential sub-franchisee who I believe would be excellent. She has considerable business experience, great sympathy with Body Care's philosophy, and a lot of enthusiasm.
Mrs Tntz owns a chain of four pharmacies in Oslo and Bergen, in which she sells a wide range of natural products including cosmetics. Indeed, her real interest is in natural products not pharmaceuticals.
Unfortunately, as you know, I am not in a position to offer her a sub-franchise because the second center in Stockholm and the one in Malmö are not open yet, and I have been trading for only fifteen months. In my view, it would be a mistake to lose her.
I enclose a detailed proposal with sales projections.
Yours truly,
Isabella Hallberg
Isabella Hallberg
(Encls: 2)
62 KUNSGATAN, S-115 80 STOCKHOLM TEL: + 46 8 555 0000 FAX: + 46 8 555
ŒThe following is the first page of the proposal enclosed in Mrs Hallberg's letter to Scott Ringer.
Read the text.
BACKGROUND
Margareta Tntz is 28, widowed, with two children. Her parents are refugees from Hungary who settled in Norway when she was three. She has Norwegian nationality and speaks four languages including English.
She married when she was 17. When she was 20, her husband died in a car accident leaving her with two children and a pharmacy. She took over the running of the business and increased the number of stores to six in four years. She recently sold two of the stores.
She has always been interested in natural health and beauty aids. NEP's range of pure health products, and Favel's skin and hair treatments were first introduced to the Norwegian market through her stores. She attributes her success to the fact that her customers have a choice between traditional pharmaceutical products and a wide range of natural alternatives.
The importance of this side of her business has grown steadily over the years, while sales of traditional pharmaceuticals have remained static. Sales of natural products are now double pharmaceutical sales by value. She believes that the next logical step is to close her stores and reopen them as Body Care Centers.
PROJECTED VOLUME OF SALES
Margareta Tntz is convinced that the volume of sales in all her stores will rise dramatically when the image of her stores is more clearly defined and when the sales areas are devoted exclusively to those products that sell best.
Sales $000
Bergen:
Kongoscarsgate
Baneveien
year current
1
198
2
3
4
Oslo:
Akersgate
Holtegate
Her intention would be to refit all four stores simultaneously to Body Care's specifications, starting as soon as she secures a Body Care franchise.
Π1. Notice:"Sales of natural products are now double pharmaceutical sales."
A is double B. A is half B. A is twice B. A is a quarter of B. A is two and a half times B. A is a third of B
