Caterquip is set to offer entrepreneurs a way into the used and reconditioned catering equipment market by franchising out its business.
The company believes that establishing franchise operations around the UK represents a more practical way of expanding its business than opening up sales offices and will help it achieve countrywide coverage in a highly profitable way.
Caterquip has carved up the country into 105 separate regional territories, with the cost of acquiring a franchise starting at £41,500.
“For that £41,500 they literally get a turnkey solution and are ready to trade,” explained Caterquip founder Dominic Ricciardi. “We’ll help them find and source an industrial unit where they can sell reconditioned and new catering equipment, as well as associated services such as detergent sales, new sundry sales, oil filtration and kitchen deep cleans.”
Caterquip estimates that a typical franchisee could generate a turnover of between £150,000 and £225,000 in the first year, rising to between £400,000 and £650,000 by year three.
The length of the contract is 10 years, with Caterquip levying an 8% fee on the total annual sales made by the franchisee each year.
Caterquip has spent £75,000 developing the programme so far and plans to invest a further £180,000 in the next two years to increase its central warehouse capacity and improve its website and SEO capabilities to the benefit of franchisees.
Ricciardi insists that given the company’s reputation as the UK’s primary supplier of reconditioned catering kit and the prohibitive cost of buying brand new equipment during the current economic climate, the franchise opportunity gives others a unique chance to join a successful organisation.
“We have been around for 13 or 14 years so we are going on the back of the brand and we have developed a proposition that will really allow the franchisee to offer a one-stop-shop for the end-user customer. The intention is that we are going to have critical mass across the country, under one banner, with head office support but operating on a local basis.”