Become a Pick n Pay Franchise Owner

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What about funding?

The below information will assist a potential franchisee to determine how the total investment may be funded and what funds the franchisee is expected to invest in setting up the business.

Investment before borrowing
These are the funds the franchisee is required to invest in setting up the business before any other borrowings or financing. The franchisee’s investment will generally be made up of two components:

  • Free, unencumbered cash
  • Acceptable tangible security, including:
    • Registration of a second mortgage bond over the unbonded portion of fixed property.
    • Fixed deposits
    • Surrender value of life policies ceded
    • 50% of the value of equities or unit trusts ceded

The franchisee’s investment is set out below:

Investment before borrowing
Establishment Cost 9 512 000
Franchisees Investment
– Unencumbered Cash 665 000
– Acceptable Security 1 330 000
Total 1 995 000

Please note: The above is the minimum amount a franchisee would be expected to invest in the business.  These amounts may increase depending on the size and location of a specific site.  It is also based on a developer’s contribution of R400 000. Should this contribution not be forthcoming for any reason, the franchisee’s required investment will increase accordingly.

 

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