Rent-A-Rita, Inc.
Preliminary Licensing Agreement & Business Description
Business Description:
Rent-A-Rita, Inc. provides rental and delivery service of frozen beverage machines for individual parties  and catered events. Our rentals in the Austin, Texas market are generally $85/night, which includes delivery, setup, and 1 batch of Margarita Mix (at an approximate cost of $5 each).  For other beverages, such as frozen coffee drinks, Cape Cods, etc., the price of syrups will vary, but are closer to $10 each.  The customer must supply any liquor in order to absolve the licensee without a liquor license from liability.

This business is designed to be an entry point for entrepreneurs that may still need or want to keep their “day job”, but could use a supplemental income. However, it is also an extra service for liquor stores, party supply stores and catering companies.

 Primarily a weekend business, the licensee should be able to gross $3,400/month if renting all 5 machines on Friday and Saturday @ $85 per 24 hour rental period. If there is no competition in your area charging more is certainly possible. Some markets will bear $150 rentals and higher.  Due to the weekend nature of this business, it follows that the more machines you have rented, the greater your revenues will be. (10 machines consistently rented would gross $6,800, 15 machines $10,200/month, etc.)

Although the business is primarily weekend, there are many opportunities to grow weekday business by dealing with caterers, convention centers and hotels in your area.

License Costs:
[These are preliminary figures and business procedural plans, designed to be informational to prospective licensees, and are subject to change without notice until a binding contract is agreed to by licensor (Rent-A-Rita, Inc.) and licensee prospect.]
 
 

The Starter Package:
In order to procure a Rent-A-Rita  license territory (25-mile radius), the licensee must purchase a minimum of 5 frozen beverage machines. There are several manufacturers that have very reliable equipment. Each have their strengths, and prices may vary slightly on a seasonal basis, and manufacturer chosen, but average between $2,500 and $3,500 per unit. If the licensee is interested in purchasing used machines, that can save some money, but warranties are generally not available.
· We will assume Quantity 5 @ $2,700 for a machine cost of $13,500
· The licensee’s delivery vehicle will need the copyrighted Rita Goddess Graphic, allow $400.00 - $500.00 for the artwork and installation) Magnetic signage is also an option, and is somewhat cheaper, in the $150.00 range.
· Cost of incorporation (S-Corp), mixes, cups, custom carts, uniform shirts, and incidentals raise the entry cost for capital goods another $3,000 to approximately $16,500.
· Sales and administrative materials:
· Customer Agreement Forms.
· Mixing instructions
· Computer Graphic files of the copyrighted Rita Logo to use on marketing collateral and multimedia.
· Templates for use with Quickbooks acounting software.
· A web page on Rentarita.com, and/or a web link to the licensee’s site.
· Rental Contracts
· Mixing instructions to distribute to customers.
· Telephone answering script with important questions to ask your customers, and responses that work!
· All marketing collateral in electronic format (MS Word)
· The license fee paid to Rent-A-Rita, Inc. is a one-time fee of $2,500
· The Total to get started is, therefore in the neighborhood of $19,000, most of which is in capital equipment that the licensee can sell if they decide the opportunity is not for them.
· With 3 machines rented 2 days per week @ $85 - $100 ea, the monthly revenue is $2,040 - $2,400.  This kind of volume should be achieved within 3 months with minimal advertising expense.
 

The "Next Step Up" Package:
In order to procure a Rent-A-Rita  (50-mile radius) license territory, the licensee must purchase a minimum of 10 frozen beverage machines. There are several manufacturers that have very reliable equipment. Each have their strengths, and prices may vary slightly on a seasonal basis, and manufacturer chosen, but average between $2,500 and $3,500 per unit. If the licensee is interested in purchasing used machines, that can save some money, but warranties are generally not available.

Some manufacturers are:
Frosty Factory
SaniServ
Stoelting
CrathCo

We will assume Quantity 10 @ $2,500 ea for a machine cost of $25,000

The licensee’s delivery vehicle (Van, Trailer or Step-Van) will need the trademarked Rita Goddess Graphic. Allow $400.00 - $500.00 for the artwork and installation) Magnetic signage is also an option, and is somewhat cheaper, in the $150.00 range.

•  Custom carts are $200 apiece
•  5 uniform shirts with the Rita logo and your new phone number (the last 4 digits of 7482 spell RITA) These vary with the market, but $30/shirt
•  Cost of incorporation (S-Corp) is usually no more than $400, but varies by state
•  6 cases of mix & 2500 7 oz cups
•  The initial license fee paid to Rent-A-Rita, Inc. is  $2,500 and purchases
•  Sales and administrative materials:
•  Customer Agreement Forms.
•  Mixing instructions
•  Computer Graphic files of the trademarked and copyrighted Rita Logo to use on marketing collateral and multimedia.
•  Templates for use with Quickbooks acounting software.
•  A web page on Rentarita.com, and/or a web link to the licensee’s site.
•  Rental Contracts
•  Mixing instructions to distribute to customers.
•  Telephone answering script with important questions to ask your customers.

 All marketing collateral comes in electronic format (MS Word)

The Total to get started is, therefore in the neighborhood of $27,500, most of which is in capital equipment that the licensee can sell if they decide the opportunity is not for them.  With 10 machines rented 2 days per week @ $85 - $100 ea, the monthly revenue is $6,800 - $8,000.  This kind of volume should be achieved within 3-6 months with minimal advertising expense. At this rate, your revenues recover your investment in less than 6 months.
 
 

 Rent-A-Rita Exclusive Licensing Agreement

This agreement is entered into on the _______ day of ____________ by Ed West Klingman, President of, and doing business in Austin, TX as “Rent-A-Rita, Inc.”, hereinafter “Licensor”, and _______________________________________    (hereinafter “licensee”).

Guaranteed Licensee’s Rights
 

• The licensee will purchase, for $2,500.00, exclusive rights to use the Rent-A-Rita name and design logo for the business of renting margarita machines.

•  The above purchase also gains licensee the right of first refusal to purchase, for an additional $2,500.00, the exclusive right to use the Rent-A-Rita name and design logo for renting margarita machines within a radius extending an additional 50 miles adjacent to the original territory guaranteed by this agreement, thereby encompassing a 100 mile territory.

•  The rights outlined above are guaranteed to the licensee for as long as they purchase an annual license renewal for a fee of $500.

•  The licensor retains full ownership of the Rent-A-Rita name and design logo and all other proprietary information that licensee has purchased rights to use. Licensees will not engage in the business of selling Rent-A-Rita licenses, or margarita machine rental business opportunities in competition with Licensee.

• Should licensor sell, transfer, or assign the Rent-A-Rita name, design logo, and products, the rights and priveliges of the licensee will survive and perpetuate subject to the conditions outlined above regarding purchase of annual license renewal.

In the interest of maintaining a high standard of quality control, any use of the Rent-A-Rita name and/or design logo except as specified in this document must be approved by licensor in writing.

Licensor:                                                                     Licensee:

By:_________________________                            By:____________________
Ed West Klingman, President
Date: ______________________                              Date:__________________