Recession-proof retail opportunity for gadget lovers...
With a business system that's virtually recession-proof and an established brand with a loyal customer base, CeX is aiming for national coverage within four years. Adam Browning reports
CeX Hemel Hempstead franchisee Stephen Boult
CeX is the one-stop-shop for gadget lovers. In the fast and ever developing world of high-end electronic entertainment, CeX provides a valuable service to technology enthusiasts wishing to stay ahead of the game. The business model involves the buying and selling of quality second-hand technology and entertainment products. The ongoing development of mobile phones, MP3 players, digital cameras, computers and games consoles means models are quickly updated and replaced. CeX has widened these growing markets by giving customers the choice to buy second-hand goods with a 12-month warranty at attractive prices and the ability to exchange their unwanted goods for cash or something they do want.
With a franchise package that is geared towards success, Hugh explains that 'franchisees will benefit from CeX's knowledge and experience of the marketplace such as optimal buying and selling prices and product supply and demand curves, which are essential to business success and avoiding stock shortages or surpluses.'
In fact, CeX is so confident of its opportunity that the company is offering for a limited period a 'Buy Back Guarantee' for new franchisees. Subject to conditions, CeX will refund stock, shop build and fit costs, and take over the store management and running costs should the franchise not meet the franchisee's expectations.
Founded in 1992, CeX is embarking on a nationwide franchise development programme and is searching for energetic and enthusiastic business-minded people who want to operate in a dynamic, fast-paced business that's driven by consumer demand. One such person is franchisee Stephen Boult who, having only opened his first store in October 2006, has already launched his second.
'When I decided I was ready to open my second store I had an indication of where I would like to locate it, so I sat down with Hugh and we came up with four or five possible locations,' says Stephen. 'I went out looking at the locations with Hugh, who has been with CeX almost since the company was founded and has a lot of experience with this. We got a feel for the towns and looked at shops and the area. Although Hugh was on hand to help, the choice was mine at the end of the day and I choose to open it in Luton because, being 30 minutes from my first store, I can easily get back and forth as well as having a market for what I sell.'
Before this success however, CeX gave Stephen a period of training. 'It was great - I had three initial days working in a busy shop when I first showed interest just so I could see if it was for me,' he reveals. 'Before I opened I spent eight weeks working full time, learning the trade in the CeX shops. I loved the experience - it was fantastic preparation for the opening of my own shop.' Impressed with the strength of CeX's internal support structure, Stephen reveals that he could not ask for more: 'They're very proactive. They regularly get in touch with me and visit the stores to offer advice and make sure the business is reaching its potential. I can benefit from the knowledge of everyone involved: the IT team, the marketing team, the stock control team and of course the management team. This gives you everything you need to run and nurture your new business.'
With his franchise achieving great success and having an estimated turnover for this year of over £1 million, Stephen aims to expand his business further: 'I do plan to open more shops. In a few months time if everything goes according to plan with my second store I'm going to start looking into opening my third. I want to have as many stores as possible.'
Reveals Hugh: 'Through franchising we aim to achieve national coverage, making our goods and services widely available. By working closely with our franchisees, within the next three years we aim to establish a network of over 100 company-owned and franchised stores nationwide. This is a business that works when the economy is booming and even better when it is less buoyant.'
CeX franchisees benefit from an established and proven business model, including:
• Initial training and ongoing updates
• Limited competition
• Stock and pricing advice from experts
• Ongoing support including intranet
• Hands-on store set up, including site identification, design & outfit
• Bespoke EPOS designed especially for buying, selling and exchanging goods
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