Kwik-Fit-Archived
ABOUT KWIKFIT
Kwikfit is an international brand with an extensive footprint in Europe that includes over 600 stores in the UK and 200 outlets in Holland. While Kwikfit has been present in South Africa for over 30 years, recognising the necessity of adapting to a change in consumer habits, we have revisited our business strategy and completed a rebranding exercise that has resulted in a revived corporate and public image.
In 2012, Kwikfit was rated the 3rd most recognized brand in after sales service industry.
Starting out as an exhaust specialist we expanded our portfolio to include underbody services, and since 2002 the Kwikfit brand has become synonymous with tyre retailing. 2014 saw the launch of our new ‘beauty’ concept that incorporates car wash, dent and scratch repair and valet services under one roof in two of South Africa's most prestigious malls, Cavendish Square and the V&A Waterfront. Kwikfit SA subsequently followed with what we arguably consider to be a world first, combining beauty with health by adding tyres, batteries, exhausts, shocks and all underbody work, plus major and minor vehicle services which was launched in the Killarney Mall.
Originally operating as a large tyre distribution franchise network, supported and controlled by a large South African distributor and 16 of our franchisees continue to operate as tyre retailers. Wanting to change the direction of the Kwikfit brand, the brand holder Kwikfit Holdings set about developing the new business model that incorporates all vehicle ‘health and beauty’ services under one roof. Kwikfit SA has five company owned operations, four of which are located top ten malls measured by LSM while the Stellenbosch branch is the first main street operation to offer the full range of ‘health and beauty’ services.
Kwikfit is your car GP.
We aim to grow the Kwikfit network to over 100 stores across South Africa and with the aim of expanding the brand into Africa we have registered trade marks in several African countries. Discussions with various malls are currently underway, and we are looking for franchisees to occupy these potential spaces.
Kwikfit is also owner of the Fastfit brand.
MEET THE TEAM
Simon Koch
Kwikfit SA CEO
Simon qualified as a Chartered Accountant and has a background in corporate finance. He built Sovereignty Capital, a company involved in mergers, acquisitions, mining, motor and manufacturing businesses and during this time he was instrumental in the buyout of Vulisango's 40% interest in Continental tyres in South Africa. He also held the position of CEO at both ICH Motors and Sinclair Holdings, a listed company. Before joining Kwikfit Simon consulted to past Kwikfit shareholders for eight years.
While Simon was part of the consortium that purchased the Kwikfit brand in 2013, he only recently took over the role as CEO. Simon believes that there is a need for an all-encompassing motor service provider who, without being brand specific, can offer customers independent advice on the best solution for their vehicle. Under Simon’s stewardship Kwikfit has been transformed from a tyre retailer to a fully-fledged service centre with five new product categories that aims to provide comprehensive after sale services for all makes of cars.
Guy Bakers
Kwikfit SA Director
During his 39 years in the tyre industry, Guy has worked for three of the major national tyre suppliers as well owning and running a re-treading and earthmover tyre company for 20 years. Guy has been with Kwikfit SA since the inception of our first new look store and he has been involved in all spheres of the business, from operating dent and scratch facilities to installing facilities at a new branch. Guy is also responsible for managing supplier and franchisee relationships.
Asked how he feels about the future of tyre and fitment industries in SA, he says, “With over 280 tyre brands (homologated) available in the South Africa, it is an extremely competitive and overtraded industry. Fitment Centres will struggle to survive unless they diversify their services portfolio.”
Simone Jones
Company Secretary & Cape Region Finance Manager
Simone completed a BCompt Degree through UNISA with a bursary from PwC and later also completed her articles through PwC. She has around eight years’ experience in the financial field as well as several years’ experience in company secretarial work and BEE compliance. Her ability to understand all the issues surrounding company statutory compliance and then execute the necessary steps to ensure compliance has served her well.
Kelly Robbertze
Marketing Manager
Kelly obtained her marketing degree through AAA School of Advertising in Cape Town in 2011 where she specialised in media, brand and account management. She began her career at an advertising agency before moving into events management. She then relocated to London, where she worked as an account manager for a well-known health and fitness brand. Since returning to Cape Town Kelly has worked for Kwikfit SA, handing the brand and account management for all five corporate stores, as well as contributing to design and campaign development for all promotions and events.
OUR CULTURE & VALUES
At Kwikfit we know that complete trust from customers is the key to success. We aim to provide motorists with the best service experience and service delivery statistics is measured daily.
OUR FRANCHISE OFFERING
Kwikfit offers franchisees a choice of two business models defined as Kwikfit at the Mall and Kwikfit on Main. Our new business model incorporates four business centres in one facility paving the way for a new era in aftermarket service. We estimate that, depending on their sales mix, existing franchisees who convert to the new business model will be able to increase their turnovers by over 40% with gross margins exceeding 50%. We have prepared financial models for various services based on our experiences in the market and these will be made available to the franchisee once a non-disclosure agreement has been signed, they have passed the initial test, and a deposit has been paid.
Return on capital employed (ROCE) is high but will depend on the capacity utilisation achieved by the franchise. We anticipate a return of 100% at 80% capacity and 25% to 30% ROCE at 40% capacity. Financial models and market information is available on request. Estimated achievable turnovers range from R6-million a year for a small main street operation at operating at 40% capacity to R22,6-million a year for a mall store operating at 80% capacity.
Our business model is service rather than product dependent, so the better the service provided the better the returns and cross-selling across the range of complimentary services offered, franchise have further opportunity to increase their turnovers. We are also currently working on insurance products (Kwikfit Insure) that will enable franchisees to earn an annuity income.
Kwikfit SA has over 20 stores located across the country of which five are based on the new business model. We are in the process of phasing out our tyre centre franchises in favour of establishing more comprehensive car care centres and we are looking for new franchisees to join our ranks.
THE KWIKFIT REVOLUTION
In the past servicing, fixing and generally having their vehicles tended to meant that vehicle owners had to visit multiple car service and parts shops, and given the traditional locations for such outlets vehicle owner either had to arrange lifts to and from these locations or they had to wait around while their vehicle was being tended to.
“We listened to what our customers had to say.”
Combining our wide arrange of services under one roof and establishing our auto care centres in mall parking areas creates a more pleasurable and convenient customer experience that also allows customers to take advantage of the longer trading hours.
PRODUCTS & SERVICES
With an estimated 7,5-milllion vehicles out of warranty there is a huge demand for the services offered by Kwikfit. While we service all makes and models of vehicles, instead of promoting a particular product or brand we advise clients about the various options available to them allowing them to choose the option they are most comfortable with.
Our vehicle health services include tyres, brakes, shocks, batteries, exhausts, wheel alignment, diagnostics, major and minor services, and a 77-point vehicle health and safety checklist. In addition, we also offer car wash, polish and valet services as well as dent and scratch removal to help owners preserve the appearance of their vehicles.
MARKET TRENDS & TARGET MARKET
While our target market comprises anyone between the ages of 18 and 80 who owns a vehicle, a significant percentage of our customers are women with busy lifestyles, who appreciate being able to have their vehicles serviced and taken care of in a safe and convenient location.
In addition, the corporate market and companies who provide full maintenance leases find value in our weekend and after-hour services.
BECOME A FRANCHISEE
When assessing the suitability of applicants to fulfil the role of Kwikfit franchisee, we look for individuals with good people skills, who are adept at managing people and have the capacity to work in and lead a team. Preference will be given to candidates who are proficient at building long-term relationships and have the ability to market themselves and their business. Technical skills, a love of cars and fixing things although not a requirement would stand the franchisee in good stead. Kwikfit promotes owner-operated franchises.
ESTABLISHMENT COSTS
DEALERSHIP WITH 4 OPERATING MODULES:
Establishment cost:
R2,5 million (including joining fee)
Working capital:
R1 million
Total set-up cost:
R3,5 million
TOTAL set-up cost = Establishment cost + Joining fee + Working capital
Own cash contribution:
35%
The four operating modules are defined as follows:
Car wash
Services &
77-point checklist
Dent & scratch
Tyre & underbody service
(major and minor)
LOCATION REQUIREMENTS
Parking garages are ideal, alternatively standalone premises below offices are also suitable.
STAFFING REQUIREMENTS
The typical staff complement for a main street outlet will comprise a Store Manager, three Assistant Managers, a mechanical assistant, a tyre fitter and assistant and a dent and scratch technician and assistant. Depending on whether the outlet has two or four wash bays, either ten or 20 wash staff is required.
TRAINING
All staff are required to spend a month at the Killarney Mall branch where they will receive the necessary training. Managers and Assistant Managers, in particular, are trained on all aspects of the business. In order to ensure that staff are up to speed with and knowledgeable about the products and services available from Kwikfit, five days a year are dedicated to supplier training.
FRANCHISOR SUPPORT
Franchisees are offered a full turnkey solution that includes partnering in the build, assisting with refurbishment, and selecting equipment. The Kwikfit franchise team assists franchisees the financial and operational aspects of their business and franchisees receive an operating manual, management information pack and a standard accounting system.
We guide franchisees in setting up supplier and national accounts that allow them to trade on the same terms as our company-owned stores. While franchisees participate in the national advertising campaigns and promotions, we also help them to develop a location appropriate marketing strategy.
AVAILABLE LOCATIONS
Eastern Cape
- East London, Beacon Bay
- Port Elizabeth, The Boardwalk
Gauteng
- Johannesburg, Killarney Mall (urgent)
- Johannesburg, The Glen Shopping Mall
- Roodepoort, Ontdekkers Road
KwaZulu-Natal
- Tongaat
- Ballito
Limpopo
- Thohoyandou, Thavhani Mall
Western Cape
- Worcester
TERMS OF AGREEMENT
Agreement term:
5 Years
Management services / royalty fee
2% on Tyres and 5% on all other products & services
Marketing fee
1.5% on turnover
COMPANY INFORMATION
Registered name:
Kwikfit South Africa (Pty) Ltd
Registration number:
2001/005722/07
Shareholding:
Sovereignty Investment Trust Company (Pty) Ltd is the majority shareholder of Kwikfit SA.
Head office address:
Unit 111 Northgate Park, Section Street, Paarden Island, 7420
Phone:
+27 21 072 0544
Email:
Website:
FAQ's
FUNDING APPLICATION
The consideration of an application for funding by an individual to a financial institution, whether it is a commercial bank or a development funding institution, always pivots around two principles:
- The profile of the applicant candidate with reference to financial position and the way in which an individual conducted his or her personal financial affairs. In certain cases, prior experience in the industry in which the franchise brand operates will be required, e.g. the restaurant and hospitality industries. The funder will also assess the current lifestyle of the applicant in order to determine if the size and profitability of the new business suits the applicant and if expectations could be met.
- The parameters of the actual opportunity available, whether it’s a new or existing business. The business case for the repayment of a loan is always dependent on the numbers, which is a function of location, projected sales, overheads, etc.
It is therefore not possible for a funding application to be processed unless all the details of the applicant, as well as the details of a business’ plan, demonstrating that the business will be able to repay its debt, are available. The initial step will always remain an application to the franchise brand in order to introduce a candidate, after which specific opportunities would be communicated to be followed by an application for funding.
Kwikfit will certainly be able to refer successful applicants to suitable funders once an application has been approved by the franchisor, but every funder will also have its own application and approval process.
What could be stated is that once a prospective franchisee has completed the online 6-step application process below, the same application will be submitted to the funder, i.e. no additional forms will be required.
ABOUT THE APPLICATION PROCESS
Should you wish to proceed with the application process, you will be required to register online and navigate your way through a 6-step application process. Only after completing the application process will the franchisor provide you with a detailed Disclosure Document as required by the Consumer Protection Act.
The 6-step application process is designed with three objectives:
- To allow the prospective candidate an opportunity to disclose and communicate all the personal information required by the franchisor and the funder to take a view on how well-suited you are for assuming the role of franchisee.
- As intimidating or time consuming as the application process may seem, it exposes you to a fraction of the level of resilience required to ultimately own and manage your own franchised business.
- Successful franchisees comply with the rules and procedures of the business system. Completing the five steps of the application process can be deemed your introduction to adhering to the Kwikfit business system.
While the application process is not intended to discourage prospective franchisees or to create barriers to entry, the process by its very nature will serve as an early deterring mechanism for candidates who should not be pursuing business ownership. The truth is that the challenges a franchisee will face in their own business is significantly more complicated and daunting than the application process. If you are intimidated by the 6-step process running a business will likely be more challenging than you are anticipating, essentially putting yourself, the franchisor, the funder, the landlord and your future staff at risk.
From a cost perspective the charges relating to the entrepreneurial assessment, application review and credit profile verifications are insignificant when measured against the cost of buying a franchise, and it could be the best money you ever spent should the outcome confirm that you should not venture into business or that you would not be able to attract funding.
APPLICATION PROCESS
Upon completion of STEP 1 to 3, you will receive a notification from Kwikfit to proceed with STEP 4
STEP 4
Complete full application plus document uploads
STEP 5
Request credit check and application reviewR1 725.00 VAT Incl
STEP 6
Franchisor introduction
meeting
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