Franchise "Pyaterochka": reviews. The nuances of starting a business

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

Franchising is a modern and very convenient form of relationships among businessmen. The finished model greatly contributes to the implementation of any idea.

Pyaterochka franchise has long deserved special popularity. This supermarket chain is a Russian brand of X5 Retail Group Corporation.

The formation of the assortment of each outlet is carried out depending on the daily demand of the buyer, whose place of residence is nearby. The target group is a person with an average income, so every supermarket tries to keep prices low. Attracting additional buyers is carried out by setting discounts for a certain group of goods or holding promotions for a certain period of time.

The history of the development of Pyaterochka supermarkets

The opening of the first Pyaterochka supermarket took place in 1999 in St. Petersburg. At that time, the LEK company was developing very rapidly - it took it only six months to conquer the Moscow market andopening 15 stores.

In 2002, the management of "LEK" decided to try another direction of business development - this is how the Pyaterochka franchise appeared. In 2005, Kopeyka, Narodnaya Kopeyka and Perekrestok joined the network of stores. At the same time, the holding was renamed into X5 Retail Group.

Currently, the Russian market is filled with more than 6,000 chain stores, the opening of most of which was facilitated by the Pyaterochka franchise. Feedback from business buyers is extremely positive, because the company's leaders provide aspiring entrepreneurs with comprehensive support at all stages of development.

Reverse franchise. How it works

The Pyaterochka franchise, which has been constantly developing since 2002, changed its main strategy in 2009, namely, it began to adhere to commodity (reverse) franchising.

Such cooperation is based on the following principle: first, the franchisee and the head office of X5 Retail Group sign an agency agreement, according to which the novice entrepreneur receives more than 90% of the goods (except for drinks containing alcohol) and full management of the store.

The sale of goods is completed by the implementation of the collected proceeds with its subsequent transfer to the franchisor's account. The agency fee is between 13% and 17% of total sales.

From the amount received, the franchisee must pay salaries to employees, pay taxes, fees, utility costs,and also leave funds for the maintenance of the store.

Everything else will be the personal profit of the franchisee.

Franchise cost

How much does a Pyaterochka franchise cost? 1,000,000 rubles, and the size of the initial investment is about 8,000,000 rubles.

Despite such a high entry threshold, the store pays off within 1-2 years.

Benefits of a franchise offer

Individual entrepreneurs who independently opened grocery stores often cannot compete with retail chains, as they simply do not have enough resources. X5 Retail Group knows the way to minimize costs - the reverse franchising system. This is a business model according to which the buyer (franchisee) receives from the seller (franchisor) the right to use a well-known trademark and unique entrepreneurial technologies, and monthly transfers the proceeds to the account of the parent company and receives the amount of the agency fee indicated in the agency agreement.

Pyaterochka reverse franchise has the following benefits:

• work with a popular brand, which in turn guarantees a quick start of business;
• proven store development model;
• availability of software and documentation;
• commodity turnover is fully provided by the parent company;
• full marketing support;
• corporate training.

Franchise concept

Open a Pyaterochka store byfranchise can be any representative of small and medium-sized businesses. Reverse franchising requires the franchisee to follow these steps in sequence:

1. Studying and signing a set of documents.
2. Paying a lump sum.
3. Selection of suitable premises in accordance with the standards set by the network.
4. Purchasing the necessary technological and commercial equipment.
5. Hiring employees with subsequent training at the X5 Retail Group training center.
6. Opening of the store, start of sales.
7. Personnel management, sales control and inventory accounting.
8. Exact adherence to the technologies transferred by the parent company, as well as unquestioning obedience to every written order of the regional director.
9. Maintaining the store in good condition, regular payment of wages and timely payment of the budget.

Obligations of the Franchiser

In accordance with the chosen form of the store, the Pyaterochka reverse franchise can cost from 6 million rubles. and higher. In this case, the franchisor is obliged to:

1. Transfer data about each business process, document system, brand book, and inform franchisees about technologies and know-how, store technology projects, engineering solutions, etc.
2. Install the software package and update it regularly.
3. Consult an entrepreneur in terms of repairs,construction work and the acquisition of the necessary pieces of equipment.
4. Organize the supply chain and ensure that only trusted suppliers or our own distribution center are allowed to cooperate.
5. Provide possible assistance to ensure that alcoholic products are brought by suppliers of franchisees.
6. Involve the franchisee store in the chain's marketing and advertising campaign.
7. Monitor compliance with the terms of the franchise.
8. Pay agency fees.
9. Perform a scheduled audit.

Buyer Requirements

The Pyaterochka franchise allows a newly minted partner to count not only on a stable income, but also be sure that he will not be left in a difficult situation.

At the same time, a potential buyer must meet the following basic conditions:

1. Have own or attracted investment investments.
2. Own or lease suitable retail space.
3. The franchise store must be located in one of the following areas of the city: residential / bedroom / densely populated or busy area with high customer traffic.
4. There may be a major highway nearby.
5. There must be access roads and an unloading place.
6. Ensuring the possibility of pallet delivery of goods.
7. Convenient parking for shoppers.
8. Telephone line and internet.
9. Water supply, supply and exhaust ventilation, air conditioning, sewerage, securityalarm, heating.
10. The advertising sign "Pyaterochka" should be clearly visible from any side around the clock.

Requirements for the premises

Estimation of profits and costs of the selected premises is carried out by X5 Retail Group specialists. The most important factor of the entire business process depends on the location of the retail space, the population of the area, the number of competitors and infrastructure - how quickly the Pyaterochka franchise will pay off. Reviews in Moscow about cooperation with this network are mostly positive.

The only thing that confuses potential partners is a fairly high initial capital, because the modern market offers many franchises with a much lower cost.