AutoXcel
Date of Incorporation: October 25, 2004
Franchising Since: October 2004
Address: North Carolina
Description: AutoXcel is a franchisor in the auto appearance aftermarket providing exterior paint and interior repair services with a balanced royalty and initial fee set-up. The franchisor may become the only source of supply of touch-up kits and touch-up paints. The franchisor has arranged for supply of paint for the exterior paint set-up with a national vendor.
Franchise Offer: The AutoXcel franchises offered are for the performance of services that include either interior or exterior automobile appearance repair. The franchisee may provide only one service if it chooses to do so. The franchise services are in the performance of interior repair (i.e. — repair of carpets, seats, furniture, leather, velour) or exterior paint repair, and the franchises are either a Non-exclusive Territory or Exclusive Territory franchise.
i) The franchisee specializing in interior repair will provide services in repairing, re-colouring and cleaning cloth, velour, leather, vinyl, carpet and plastic covered surfaces of vehicles, boats, and furniture.
ii) The franchisee specializing in exterior paint repair and touch-up will provide services in repairing defects in the painted surface of vehicles, boats, and other forms of transportation and other items such as caskets and guitars.
iii) A franchisee may offer more than one service in its franchise, interior and exterior repair, but the franchise agreement must indicate the same either by original agreement or by amendment. Training is required for each particular service prior to the franchisee attempting to provide the service.
iv) Exclusive Territory franchisees are in the placement and operation of a fixed location which must offer at least paint services. In order to open a fixed location, the franchisee must have an exclusive territory granted by the franchisor in writing and the franchisee must follow the site requirements, specifications and fixed location rules.
Financial Assistance: The franchisor may offer to finance part of the fees of the franchise. The franchisor is not obligated to do so. If the franchisee meets the credit standards, the franchisor may finance a part of the initial franchise fee or part of the equipment package. If so, the franchisee has to agree that they will execute a promissory note for a period of 18-36 months with interest at 10% per annum.
Training and Assistance: The franchisor will conduct the initial training program as needed at the training centre in Carrollton, GA or at other locations depending upon logistics, convenience and schedules. The initial training program for an Exterior Paint repair services is two weeks of training in the classroom, in the field and with hands-on instruction. Interior training will be for no less than one week but the franchisee may be required to spend two weeks in training.
Territory: The franchisor will grant a license for the franchise in a geographic area that will either be a Non-exclusive Territory or Exclusive Territory depending upon the type of franchise acquired. The areas are determined based upon population and the number of automobile dealerships in the proposed territory. Under the Non-exclusive Franchise Agreement, a franchisee is granted the right to operate a franchise within a specified non-exclusive territory. Under all arrangements providing exclusive territory, the franchisor will grant an exclusive geographic area based primarily on the number of dealerships and population.
Term of Agreement and Renewal: The term of the Franchise Agreement is 10 years. The franchisee can renew the franchise three times in additional increments of 5 years. The franchisee must give notice, not be in default, sign then-current form of Franchise Agreement, for the type of franchise, sign release and pay renewal fee for the renewal or extension of the Franchise Agreement.
Obligations and Restrictions: The franchisee need not personally supervise the franchise business. However, the franchise business must be directly supervised by a person designated as the manager who has completed the franchise training program for the services provided by the franchise business. The franchisee may sell or offer for sale only those services that meet the uniform standards of quality and quantity and as have been expressly approved for sale in writing by franchisor.
Total Number of Units: 4 Non-exclusive and 4 Exclusive franchisees at the end of the financial year 2005.
Investment Table:
Initial Investment for Non-Exclusive Territory:
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $9,950 | $9,950 |
| Qualified white trailer, van or truck | $2,000 | $25,000 |
| Initial Equipment, Inventory, Supplies and Training for the Required Services for One Unit | Except for a converting independent, the initial fee includes training. Subsequent training will be at $2,000 per person for paint training and $1,300 per person for interior training. The initial paint package is estimated to cost $16,500. The initial interior setup is estimated to costs $3,500. | See column to left, except that a high estimate for the paint set up is $18,000 |
| Laptop Computer | $500 | $3,000 |
| Insurance | $2,000 | $4,000 |
| Travel and living expenses while training | $2,000 | $4,000 |
| Miscellaneous opening costs | $1000 | $1,500 |
| Additional funds - 3 to 6 months | $5,000 | $15,000 |
| Total | $45,750 | $87,250 |
Ongoing Fees:
| Name of Fee | Amount |
|---|---|
| Monthly Fee | Greater of $400 per month or 6.0% of all of franchisee's gross sales. In the event that the monthly gross revenues exceed $15,000 per month then the monthly royalty shall be the greater of $400 per month or five and a half (5.5%) percent of your Gross Revenues. In the event that monthly gross revenues exceed $30,000 per month then monthly royalty shall be the greater of $400 per month or five (5%) percent of your Gross Revenues. |
| Advertising Fund Contribution | 1% per month of all of franchisee's Gross Revenues. |
| Initial Inventory, Equipment and Training | AutoXcel's standard equipment charges vary depending upon costs from vendors but the costs are estimated at $16,500 for the paint set up, and $3,500 for the interior set-up, Training for the franchisee, or permitted designee is included in the franchise fee. |
| Convention Fee | Cost of admission, not to exceed $200 |
| Development Fee For Exclusive Territory franchisees | $ 100 per month |
| Transfer Fee | $1,000 in addition to a training fee of $2,500 to be paid by the transferee |
| Audit Fees | Costs and expenses of audit or review, including salary or fees paid to employees or accountants |
| Renewal Fee | $1,000 at the time of each renewal |
| Costs and Attorneys Fees | Amount will vary under the circumstances |
| Late Fee and Interest Owed | $100 for late fee for the first late payment, $200 for the second late payment and thereafter. Any late payment shall be due and payable with 1 8% per annum or maximum interest rate allowed by law (whichever is less) from due date to date of payment |
| Purchase of laptop computer | Amount of 3rd party vendor charge |
The above information has been taken from the UFOC/FDD of AutoXcel.
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