About ITEX Corporation Here you will find the answers to many frequently asked questions that our candidates have while working on Stage 2. How many employees do I need?You can start alone and operate until you have about 75 members. However, it often works better to have a partner or, if funds are available, to hire an office assistant/trade director. What type of facility do I need?Office space, signage, phone (at least 2 lines), fax, PC compatible computer, and Internet access. What type of technology (phone, fax, computer, internet) do I need?Hardware Computer: Dell Optiplex 780 desktops and Latitude E6500 notebooks Processor: Intel dual core processor Memory: 4Gb memory Hard Drive: 160 GB or larger Optical Drive: CD / DVD RW Drive Monitor: 2 - Dell ST2310 23 Inch Full HD Widescreen Monitor. Monitor stand: Dell DS-224STA Dual Monitor Flex Stand Printer: HP Laser Jet P2035 black and white printer. Software Operating System: Microsoft Windows 7 Applications: Office Small Business 2010 - Includes Outlook, Word, Excel and PowerPoint Security Software - Antivirus, Firewall, and Spyware Adobe Reader 9.0 QuickBooks Pro 2010 Accounting Software Phone system with at least two lines, plain paper fax machine and a photocopier. What investment does ITEX provide in terms of advertising and promotion in order to expand my ITEX franchise business?ITEX has a co-op program that reimburses you one half of your investment in approved marketing, advertising and business development costs. While the details of the program can change over time, the current yearly co-op budget is $25,000 per franchisee. How long has ITEX Corporation been in business?35 years (1982) How much training will I receive?One week of initial training at the company's headquarters with other new Franchisees. Other training is available including two Regional meetings each year (Autumn), an International Convention annually (Spring), and franchisee conference calls every week. How much support will I receive after the initial training, and specifically, how does ITEX support my business?ITEX provides a full Marketplace and Franchisee Support department to handle member and franchisee issues. You will have a Marketplace Support Representative assigned to you from day one, and a team of supporting staff to assist you in the running of your ITEX franchise. In addition, ITEX provides the technology infrastructure to record transactions as well as providing the billing and collections for servicing member accounts. Powerful reporting capabilities provides complete information on your office's activities as well as leading CRM technology, ITEX dollar posting, and administrative functions. What are the benefits of owning my own ITEX franchise office? Operate using a recognized name Retain local control over day-to-day operations The potential to build assets and equity Take part in national marketing campaigns Join a network of 90+ offices working with thousands of members to generate an average of $16,000,000 in posted transactions each 4-week business cycle. Systems and support including a complete 500-page Franchise Operations Manual. What are the key drivers of the business - the key skills needed?Strong leaders with sales, marketing and people management experience, who are very results oriented. A strong set of core values supporting the operation of a financial institution. Hiring and motivating a team with clearly defined roles, goals and ongoing coaching. Am I limited to a territory?No. ITEX Franchisees can recruit new members anywhere in the US and Canada. In reality, you must create a Trading Community in your local market, before you reach out to enroll new members to serve their needs in other markets. Remote members can be difficult to serve and they are free to transfer their account to a closer (if less than 50 miles away) franchisee if you can't satisfy their needs. If this is such a great opportunity, why haven't I heard of you before?ITEX operates a business-to-business financial service, and we have found that our best candidates come from people who already know about the business from other sources. We have therefore restricted our marketing to that audience. What are the biggest challenges to being successful?The same as any service-related business: focus, concentration, persistence, and time management, as well as very results oriented, with experience in sales, marketing and managing people. Explain how this business survives - why it has "staying power"?The members have a vested interest in the health and well being of the business. Their ITEX account has "money" (ITEX dollars) in it and they want to be able to realize the benefits of buying at their Cost Of Goods Sold with this new money from new customers. Members' average time with ITEX is about 5 years. What will cause my ITEX franchise business to grow quickly?A total commitment to adding new members every week, throughout the life of the franchise. Building a positive, stable marketplace with well-trained members in industries businesses need (printers, pest control, restaurants, hotels, etc) as quickly as possible. The more cashless partners your members have to transact with, the happier they will be with the ITEX Marketplace. Also, relying on the opportunities and systems provided by Corporate and networking throughout the ITEX community are vital to the strength of all Franchise offices. Do I have to be involved in the day-to-day operations of my ITEX franchise?The Franchise Agreement requires that either you or a full time General Manager be involved day-to-day. If you use a General Manager both you and they are required to attend the franchise training class at our headquarters. How do I get started??Request the Franchise Disclosure Document (FDD). What if I want to sell my franchise later on?You are free to sell your franchise at any time. ITEX retains the right to approve the new franchisee. There is a $2000 transfer fee, the new franchisee would sign the then current Franchise Agreement, and they are required to attend training at our headquarters. Are there any existing franchises for sale?We do not offer franchise resells. From time to time a current franchisee will let us know they are interested in selling, and you can get that information by requesting it from our franchise department. My question was not answered here. What should I do?Contact us by phone at 800.277.9722 or email at firstname.lastname@example.org and we will make sure you get the answers you need. About Your Market What dynamics are important to consider in determining if I'm in a good market?A well-networked business community. Small or seasonal business markets present serious challenges to a thriving franchise. What research do I need to do in order to determine the state of my market?We suggest that you complete a Market Study before you move on in the process of becoming an ITEX franchisee. Please download the Market Study Template, and complete the study to learn more about your local market. What competition should I expect?Part of your task is to research what competition exists in your local area. The Market Study Template includes a place to compare the results of your research on your competition. How does ITEX compare to the competition?There is no comparison. ITEX was founded in 1982, has 90+ offices and thousands of business members, generating $250 million in transactions per year, and is a public company (OTC BB: ITEX). Combining those facts shows that ITEX dominates our business. We offer referral and co-op programs to our members that no competitor has been able to duplicate. In addition, ITEX members are encouraged to earn and spend ITEX dollars anywhere in the system with, or without, the assistance of their ITEX trade director. With international offices and brokers that actively work to support their members, we have created a financial system that can dramatically improve the financial position of our members. I can't find any competitors. Where should I look?Think like a customer. Where are you going to look? First, check the yellow pages under Barter, Trade Exchange, Business Services, Marketing, etc. Second, use the internet to do a search on your area. Even look in the Business or Finance sections of newspapers and magazines for ads or articles about barter, trading, networking, alternative currencies, etc. As a customer, you want this process to be easy. If your competition is hard to find, then that tells you something about their professionalism. The competition won't call me back. How long should I wait?As a customer, how long would YOU wait? If they don't call you back then don't worry about it. Again, it shows you the quality of competition in your area. While you are waiting, check out the company's website, if they have one. If they show a client list or member directory, call some of their members and ask about their experience. What business scenario should I use for my competitive survey?You should be honest when contacting your competitors for information. Let them know you are looking at franchising opportunities in the trade exchange industry, and ask if they would be willing to answer some questions. Try to gather as much information from your Competitive Survey worksheet as they are willing to share. If they are unwilling to answer some questions, make a note of that on your worksheet, as this may tell you something about that company that will help you make your decision. My question was not answered here. What should I do?Contact us by phone at 800.277.9722 or email at email@example.com and we will make sure you get the answers you need. About The Investment What upfront investment is required?The only amount that is paid to ITEX Corporation is the $20,000 Franchise fee. You will also have the costs of setting up a basic office and travel to Bellevue, WA for 5 days of training. The FDD estimates that $40,000-$55,000 in capital should be available to the new franchisee, including the franchise fee. Do you offer assistance with financing?Not for the Franchise Fee. You do have 2 Franchise accounts opened for your use. One will be your Operating account, and the other your Inventory account. Each of them starts with a $5000 Line of Credit to help you get started. Interest is charged in ITEX dollars on any negative balance at the end of each cycle. The interest rate is 6.5% per year. What Return On Investment (ROI) can I expect?How big your membership base will become, and the resulting revenue, depends completely on your vision for what you want to accomplish, and your resulting efforts to realize your goals. See the FDD Section 19, Table #1 for examples of income examples with from 50 to 500 ITEX members. How do I generate income? New ITEX members you recruit can be charged a fee to join, which you retain in full for Preferred Members. Every time a member transacts (sells or buys) they are billed a 6% (if on Autopay) cash transaction fee. As outlined in the FDD your commission is 75%. Each 4-week cycle, members pay an Association fee of $20 cash + $10 in ITEX dollars. Your commission is 35% of the cash and 30% of the ITEX dollars. Trading with your own account within the ITEX Marketplace. What about royalties?ITEX Corporation bills and collects the Transaction and Association fees generated each cycle by our members. Commission checks flow from ITEX to our Franchisees based on the cash collected and the commission schedules listed above. There are no Royalty payments due to ITEX from you. How quickly can I expect the return on my investment to begin?As soon as you start selling in your market, you can begin to recover your initial investment by bringing on new members and charging them an enrollment fee. My question was not answered here. What should I do?Contact us by phone at 800.277.9722 or email at firstname.lastname@example.org and we will make sure you get the answers you need.