Arax Restaurants

Here is a brief info about Arax Restaurants Franchise Concept Criteria and
detailed info about franchise and module fees.

Franchising is the most popular system for growing a business today. With new
markets emerging, franchise opportunities are surfacing and gaining momentum. This is
reflected in the growing number of local and international “Franchisor” in the world, be it the
Levant, the Gulf, North Africa or Asia as well as an equally growing interest on the
franchisee front by interested “Franchisees” eager to acquire a Lebanese Franchise and start
up their own branch operations.

At Arax Restaurants we believe that it is becoming clear that “Franchising” is bound

to become the business of the new century and thus for the interested party to find the right
franchise (to fit his needs) is hard work because there are so many issues to consider, choices
to make, and questions to ask.

The world is fast becoming more receptive to “Franchising” when it comes to Food
and Beverage franchise, and therefore to be successful in franchising it is vital to understand
the advantages of “Franchising” in general.

At Arax Restaurants we have developed required criteria to grant a franchise:

There are many factors involved in determining the appropriate terms and conditions
under which we Arax Restaurants - the Franchisor would grant you (the franchisee) the
right to start up an ARAX Branch. (For specific details please refer to the Franchise Offer
Circular or Franchise Agreement).

These factors include.

1. The company profile of the Franchisee and line of business to determine whether Arax
Restaurants would be a good addition to the franchisee portfolio.

2. The social, political and economic status situation in the country where the franchise is
to be being operated. Focus is placed on the size of the middle and lower class.

3. The market demand for the Arax Restaurants product and other similar products.

4. The size and characteristic of the potential market place based on an analysis of the
population such as age, gender, professions, etc.

5. The results of a comprehensive feasibility study which would determine the financial
payback period for the parties involved. The study requires visit by the Franchisor to inspect
proposed locations for the Arax Restaurants branch by the Franchisee.
 The above can pave the way for specific details to be addressed which are contained
in the Franchise Offer Circular leading to the final Franchise Agreement.

Obviously, it is preferable that (you) the franchisee has previous experience in

the Food and Beverage business and has a team to grow and expand the franchise, especially
in the local market.

However, it is not a must because of our comprehensive training program based on

our Arax Restaurants‟ operator-friendly‟ concept and our extensive management training
program provides the ongoing guidance for the franchise personnel.

In turn we prepare you, or you’re designate to manage and operate an Arax

Restaurants branch and provide you with the best support at all times including recognized
customer service techniques and simplified staff training and management.

The advantages offered to you (the franchisee) include the well known sixty years
old trade name of Arax Restaurants continuous research and development of new items,
national Pan Arab and international market analysis, economies of scale in buying, and
professional training.

At Arax Restaurants we have built our policy based on defining the roles and
responsibilities of both Franchisee and Franchisor described in detail in the Franchise
Agreement.

Our role as Franchisor is to provide the product or service as per our menu, the
management system, the operating manuals, the training manuals, assist in the pre and post
opening of the outlet, and follow up system on a monthly basis to check that your branch is
successful and our standards are well implemented and respected.

Although the role of the Franchisee is to maintain full management responsibility,

including logistics, being assisted by the support of our Arax team members so as to run
efficiently the franchise outlet. It is essential that the franchise candidate be a high-energy
individual eager to become a hands-on franchise operator.

Obviously, it is your choice to manage your franchise; however it is not a must

because we can do that for you through our management company.

Investment: At Arax Restaurants we believe that all costs are an important and
vital component of any Franchise package. Thus, the cost involved in acquiring an Arax
Restaurants Franchise is based on the territory of the Master Franchise and the
number of outlets being granted.

Investment

Based upon these criteria the total investments for an Arax Restaurants territorial
franchise will include the master franchise fee plus 2 to 3 outlets.
 The franchise option for the master franchise which is based on the standards of
Franchise and Arax Restaurants criteria calls for an investment to cover all costs of the vital
component of any Franchise package for the territory of ………. .

Branch investment for an Arax Restaurants MASTER FRANCHISE will cost:

- Module size A to be $ 250,000 to $ 350,000 excl rent. (around 120 to 250 meter square)

- Module size B to be $ 80,000 to $ 150,000 excluding rent. (around 40 to 70 meter square)

- Module size C to be $ 30,000 to $ 50,000 excluding rent. (In a mall)

Master or Single Unit Franchise: The onetime franchise fee for granting an Arax
Restaurants master or single unit franchise includes a 10 (ten) year-license to operate the
business is calculated as.

Master Franchise Fee: It depends on the province, city or territory.

Single-Unit Franchise Fee: $10,000 Fixed.

Modules Fee (branch fee): $ 20.000 for module A

$ 15.000 for Module B

$ 10.000 for Module C (Malls)

Royalty fee: 6%

DRAFT estimated income statement for a module B Arax

- Net income per month: ---- $75,000 (2500$ x 30 day minimum sale)

- Rent: ------------------------ $3,750 to $4500 (5% to 6%)

- Staff: ------------------------ $9,000 to $10.500 (12% to 14%)

- Electricity and water: ------- $750 to $1500 (1% to 2%)

-Royalty fee: ------------------ $4,500 - (6%)

- Food cost: -------------------- $15,000 to $17.250 (20% to 23%)

- Depreciation: ----------------- $750 - (1%)

- Miscellaneous: ---------------- $22,500 - (27% to 31%)

- Net profit: ----------------------$17,250 - (28% to 17%)

Please note that you can ask for our Master Franchise business study for 5 years with P&L.

Arax Restaurants particularly provide the master franchisee with the following:

1. Consultation and advice regarding the location and suitability of the premises

2. Developments with a modification of the existing menu to suit local styles.

3. Full recruitment and training of personnel. All required key staff to work in the country
for a specified period.

4. Detailed training manuals for all departments as well as operating manuals, and menu
assembly manuals.

5. Standard specifications and guidelines for the premises including furnishings, interior
design - décor, layout and fascia signs, brand identity package

6. Consultation and advice with regard to obtaining and installing relevant equipment
meeting the franchisor‟s specifications and requirements.

7. Advice on an initial advertising campaign relating to the opening of the franchise

business at the premises and such advertising material and artwork as the Franchisor
considers appropriate, followed by a detailed marketing plan

8. Advise on setting up the kitchen.

Highlights:

At Arax Restaurants, we take pride in offering one of the most reasonable, well
structured franchise programs in the region.

Our objective is to keep the investment as low as possible with maximum

profitability through good alignment, pre-planning and pre-execution.

A training program is specifically designed to meet the needs of the prospective

franchisees in order to manage effectively an operation.

It is a comprehensive four to six-week effort to acquaint the operator in training with

the day-to-day requirements of operating a new branch, including a specific period of
owner‟s simulation, during which you run our branch store as if it were your own.
 Support is offered through the Arax Restaurants team that covers management,
operations, marketing, human capital and financial advice.

Our Architects and Engineers will assist in the layout, interior design and fixtures to
complete your first Franchise branch.

The great concept of Arax Restaurants Food and Beverage (F&B) combined
with 63 years experience provides opportunities for entrepreneurs who want to share the
Arax Restaurants concept and its corporate values through the Arax Restaurants franchise
system.

The benefits of joining the Arax Restaurants Franchise network include efficient
set-up and operations, intensive training , site selection assistance, ongoing field support,
local store marketing and promotions, a research and development, advertising advise,
comprehensive training and support.

It is our “know how” to select the best quality in food and beverage and our extensive
menu that you will be receiving when you are granted a Franchise, and our 63 years
experience on how to run a successful Arax Restaurants franchise.

Our goal and methods are specifically designed to meet the needs of Arax
Restaurants and prospective franchisees at all levels in order to effectively prepare
franchisees to operate as independent profitable Arax Restaurants franchise, or to own
an ARAX franchise run by our company.

Meanwhile allow me to welcome you to the concept of Arax Restaurants food and beverage
(F&B) featuring a Lebanese company. The Capital structure is owned by Mr. Raffi
Heybelian, his wife and his two sons who own all the shares.

Arax Restaurants are being run by all each one covering his area of expertise.

1. Mr. Raffi Heybelian- Chief executive Officer CEO.

2. Mrs. Arax Heybelian- Financial Controller.
3. Mr. Serouj Heybelian- Head of Franchise Department.
4. Mr. Vrej Heybelian- Head of Operation Department.
5. Miss Aline Abi Khalil – CEO Representative.
6. Mr. Charbel Abdo – Cost Controller.
7. Chef Marwan El Helou – Executive Chef.
Background Lebanon- Arax Restaurants is a family business, the company was established in
1949 in Lebanon with its first Arax branch at the well known Arax Street next door to the
cinema, the second Arax branch opened in 1960„s in the main center of Dora a suburb of Beirut
, the third branch opened in 1972 in Jal El Dib a suburb of Beirut, and the fourth branch opened
in 1984 in Antelias, and the fifth branch opend in Sabtiye' in 1997, and the sixth branch in Haret
Sakher ( Jounieh) in 1997, and the seventh branch in Down Town in 2013, and the eighth branch
in Dekwaneh in 2013, and the nineth branch in Ashrafieh in 2013.

Jordan- Arax Restaurants first branch opened in 2007 in Amman Jordan in Madina Al
Mounawarah Street , the second branch opened in 2008 in Abdullah Ghoshe' Street , the third
branch opened in 2009 in Abdullah Ghoush Street.

Canada- Arax Restaurants is known as ″ Crazy Falafel ″ in Canada, the first branch opened in
2008 in Lavale Montreal and the second branch opened in 2009 in Lavale Montreal as well, and
the third branch in 2012 in down town.

Sultanate of Oman- Arax restaurants first branch opened in 2012 in Muscat (Shatek Qurum),
and second branch also in 2012 in Muscat (Al Harthy), and the third branch is due to open at the
end of December 2013.

U.S.A – Arax Restaurants‟ first sister company known as “Falafel Arax” opened in 1980 in
Santa Monica.

Very soon in Kuwait and Riyadh.

History

Over the last 64 years since ARAX restaurants were established our Menu has expanded and
developed by introducing new items to suit all tastes ages and suit the life style of every one at
affordable prices, becoming known as a popular affordable snack- restaurant.

The selections of our menu which we offer to the public in our restaurants include:

1- Falafel )‫ (فالفل‬:a- Falafel Classic, sandwiches or pieces (6/12) , b- A combination of

Falafel with broccoli, and Falafel with eggplant, c- Traditional Foul plates, d- Traditional
Hummus plates.

2- Shawarma )‫( شاورما‬: a- Chicken , b- Beef , c- Soujok.

 3- Lebanese Pastries )‫ )معجنات‬: a- Pastry with thyme , b- with Meat, c- with Labneh,
d- with Cheese, e- ,with Spinach, f- with Hotdog, g- with Kafta ,h- with
Potato.Armenian specialty pastries such as Armenian Rocket, and Armenian pasty with
Meat.

4- Grilled on Coal ) ‫ (مشاوي على الفحم‬: a- Tawouk , b- Meat peices, c- Sujouk, d-

Maanik, e- Kabab.

5- Sandwiches )‫(سندويشات‬: A line of MegaSandwiche includes : a- Philadelphia, b-

Fahita, c- Francisco , d- Soujouk, e- Makanek, f- Basterma, g- Tawouk Chicken grill, h-
Grilled Meat (Fillet), i- Grilled Halloum Rice with Chicken (kabse),j- Hot Dog, k- Crab
Fillet, l- Fish Fillet, m- Chicken Breast, n- Shrimps, o- French Fries, p- Rosto, q- Rosto
and Cheese, r- Cheese and Ham(Halal) , s- Tuna, t- Broccoli, u- eggplant.
A line of Submarines includes: a- Regular Sub, b- Chicken Sub, c- Tuna Sub, d-
Frankfurter Sub, e- Crab Sub, f- Steak Sub.

6- Juices)‫(عصائر‬: includes fresh juices of : a- Orange, b- Apple, c- Carrot, d-

Grapefruit, e- Grape, f- Lemonade, g- Jallab, h-Mango, i- Strawberry, j- Guava, k-
Banana Milk, l- Mandarin, m- Avocado, n- Tahiti and a selection of juice cocktails.

7- (Soft ice cream)

Arax Restaurants consistency has resulted in our modest success due to a clear vision
based perseverance on strategic planning to suite our clients‟ needs timely execution in
delivering of services and determination to perform our best at all times in all areas as we have
always done before.

Keeping up with the times we are pursuing the Franchising concept because we are
convinced that this is the best way for expansion and is fast becoming the business of the new
century allowing others to share in our success.

At Arax Restaurants company goals must be clear and shared by all of our staff
considered to be team members. Our staff represents our biggest asset some have been with us
from decades and are trained to meet our standards of customer satisfaction at all times.

We believe in providing the highest quality of food and generous portions possible, based on
excellent ingredients, spices, and secret recipes based on the way we choose our Menu items, and
a unique taste and presentation. Our commitment to quality has generated our customer‟s loyalty
from generation to generation over the last sixty years.

In closing, it is my sincere hope that you will find this information and enclosures to be
comprehensive and satisfactory paving the way for further developments.
Arax Restaurants