The investment required to enter into a Joint Venture franchise is related to the size and operating assets of the selected branch, and starts at around $400,000 for a smaller business.

Details will be discussed after mutual interest is established, and are subject to a confidentiality agreement.

Yes, at the time of joint venture commencement. Pre joint venture financial planning is a significant part of the intending Operator's due diligence process – ensuring that necessary funding is organised and in place. PlaceMakers also has a long-standing relationship with BNZ in support of JV Operator financial planning and funding requirements.

In some instances a prospective franchisee may be engaged to manage a Fletcher Distribution Limited owned store for a period prior to setting up the business as a Joint Venture. In this situation there may be an incentive opportunity to enable equity to be developed based on improved business performance.

A non refundable, one-time administration fee is charged on establishment of the Joint Venture Company. A new Joint Venture Operator should also expect to spend about $50,000 on up-front costs, including accounting and legal advice, in addition to the investment in the particular Joint Venture Company.

Each Joint Venture Company pays an annual service fee to cover services provided by PlaceMakers National Office (see "Do I get business support?" below).

Any net operating profits made by the Joint Venture Company are shared between the Joint Venture Operator and Fletcher Distribution Limited in proportion to their shareholding (49.9% / 50.1%). In theory there is no limit on the amount a Joint Venture Operator can make. In other words, the Joint Venture franchise operates very much as an incentive scheme that is designed to attract highly motivated individuals with energy, enthusiasm, leadership and business skills.

Each Joint Venture Operator receives a base monthly management fee for managing the JV Company and any profit share is paid in addition to this.

Joint Venture Operators have significant discretion and authority. We expect Joint Venture Operators to use their unique personal relationship, leadership, management , entrepreneurial, sales and service skills to grow a profitable customer-centred business in their store. Operators take the lead in day-to-day decision making around customer and staff relationships, and sales, margin, stock, debtors and overheads management - which are all key drivers of business performance and profitability.

As an established national business, PlaceMakers has in place systems, procedures and policies that underpin the brand and which must be consistently adhered to. In addition there is significant business support available through National Office.

Details are set out in the franchise and system documentation that PlaceMakers provides to prospective Joint Venture Operators.

Yes. Prior to taking up a Joint Venture, all external candidates are required to complete an ‘onboarding' programme. This involves a period of at least 3-6 months engagement in a variety of roles within the business to ensure that they have good knowledge of PlaceMakers' systems and procedures and also to ensure that they obtain the necessary experience in the building materials distribution industry.

Internally, PlaceMakers people demonstrating the potential to develop into Joint Venture Operator roles are identified and have their development targeted in areas relevant to their desired progression.

Following appointment, PlaceMakers is committed to the ongoing education and development of Joint Venture Operators - whether they are internal or external appointees.

Yes – absolutely. Each Joint Venture Operator works closely with an allocated Area Partner whose role is to support the Operator as a business consultant and assist the Operator in achieving ongoing business success. In addition, PlaceMakers runs annual conferences which include business education and best practice information sharing.

Finally, a team of personnel in National Office assists the business through a range of centrally co-ordinated business services – including marketing, brand development, merchandising and promotions, supplier negotiation, product ranging, store layouts, finance and reporting, taxation, legal, human resources and employment relations, health and safety, staff training, IT and business systems support.

The majority of purchasing takes place through the PlaceMakers National Office, based in Auckland. All suppliers are paid through National Office, every month and on time. PlaceMakers operates a standardised financial and business information system and Operators are required to manage in compliance with a number of franchise requirements, operating procedures, processes and policies.

We run a rigorous assessment process to obtain a multi-dimensional view of each candidate's business skills, knowledge and personal attributes to ensure that they are suitable and eligible to take on a Joint Venture Operation.

There are several stages including:

• Initial telephone and interview screening
• Signing of a confidentiality agreement and statement of financial position
• Initial financial checks
• Psychometric assessment, to gauge how the applicant's personality matches the JV Operator profile and whether their cognitive ability (i.e. verbal, numerical and critical reasoning skills) meet the complex requirements of the role
• Attendance at an assessment centre which includes a business case simulation, a structured interview and a store visit
• Further assessment of financial/investment position
• Reference checking
• Interviews with existing JV Operators and senior executives
• Formal due diligence and completion of commercial agreements
• Confirmation of eligibility to invest in the particular Joint Venture.
• On formal confirmation and acceptance of appointment, an induction plan and development plan are drawn up. These will help the appointee address aspects that need development to effectively drive the new JV business.

The PlaceMakers financial year runs from 1 July to 30 June and a 1 July commencement date is the norm for the most newly-appointed Operators. From time to time opportunities may also become available at other times of the year.

Time spent in the business prior to taking a joint venture, whether for onboarding or in other roles, will be determined case by case.

PlaceMakers receives expressions of interest, assesses and pre-qualifies potential JV Operators throughout the financial year. As both the company's assessment process and the candidate's decision horizon could possibly span several months, there is never a bad time to send us an Expression of Interest.

The Joint Venture franchise agreement is usually offered for a period of between one and five years. There is no obligation upon either party to renew the agreement on expiry. PlaceMakers has the ability to terminate a Joint Venture during its term. This rarely happens, and it usually relates to non compliance with systems and procedures or due to the financial performance of the store.

No.

No. Not in Fletcher Building Limited nor any of the employers in the Fletcher Building Group guarantees the performance of a Joint Venture. Although it rarely happens, it is possible that a Joint Venture Operator will be unsuccessful in operating the business. This could be due to a number of reasons, but in such circumstances it is possible that the original investment is lost completely. The past performance of a branch is no guarantee of future returns.