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BUSINESS OPPORTUNITY

BUSINESS OPPORTUNITY. I NTRODUCTION. Microsolve (Pty) Ltd - an established electronics software design and electronic equipment manufacturer - brings you the latest in GSM and GPRS communication technology.

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BUSINESS OPPORTUNITY

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  1. BUSINESS OPPORTUNITY

  2. INTRODUCTION Microsolve (Pty) Ltd - an established electronics software design and electronic equipment manufacturer - brings you the latest in GSM and GPRS communication technology. With a combined marketing and manufacturing expertise of over 25 years, we have the pleasure in offering our clients a total one-stop solution from manufacturing, marketing, sales, product back up and support. This unique manufacture and marketing structure guarantees all our Distributors and/or Agents, the latest in design, cutting edge technology, and the ongoing supply of all existing new products.

  3. PRODUCT OVERVIEW GSM INDUSTRIAL PRODUCTS GPRS PRE-PAID PRODUCTS

  4. PRODUCT OVERVIEW • CELL-TIME PRODUCTS • These GPRS products are designed for the pre-paid airtime dispensing industry, supported by services providers such as Vodacom, MTN, Cell C, Telkom and the like. • The GPRS system is supplied with a full PC back-end administration and management system. • COMMERCIAL AND INDUSTRIAL GSM PRODUCTS • The GSM cellular products are designed for such industries as agriculture and security, as well as household and industrial applications – all having the advantage of cellular control and monitoring. • All products work on the pre-paid system – no cellular contracts required. • The GSM products all have RS232 serial port PC-programmable features.

  5. THE TEAM MICROSOLVE (PTY) LTD ADVANCED MERCANTILE SOLUTIONS (PTY) LTD ELECTRONICS SOFTWARE DESIGN ELECTRONIC EQUIPMENT MANUFACTURER BACK-END SOFTWARE DESIGN PROGRAMMERS VICTOR DES NEVES (Managing Director) GERT VAN DER MERWE (Managing Director) CAMIEL DE VLESCHAUER (Non-Exec Director) ELSA VAN DER MERWE (Financial Director)

  6. PREPAID AIRTIME MARKET OVERVIEW • SOUTH AFRICAN CELLULAR STATISTICS – JANUARY 2004 • The total number of users was at 14.4 million as at • December 2003. • Growth potential of 19 million users is forecasted • by 2006 • 9,000+ New Users sign up each day • (90% of which are on Pre-Paid) • Pre-Paid calls produce some R1.3 billion revenue • per month! • Share in this market - A minimum of 7.5% Discount • of the R1.3 billion per month Pre-paid calls is worth • R97, 500,000 per month. • Rural communities (previously un-serviced areas) • are making 35 million calls per month or 65 million • minutes of cell time.

  7. CELLULAR INDUSTRY MARKET • The three Cellular Providers cover more than 71% • of the population • 90% of all cellular users in South Africa are Pre-Paid • – a total of 12 960 000 consumers.

  8. SMS MARKET SYNOPSIS • Over the Christmas period of 2003 some 135 million • SMS’s were sent. • In December 2003 MTN handled some 820 million • calls with 29 million calls being made on Christmas • Day.

  9. DISTRIBUTOR OPPORTUNITY • WhatOurBusinessOffers • An annuity-based income distribution business • opportunity • START-UP COSTS • Business Cell Selling Airtime from R54,000.00 • You Get :- • Manager WEBSITE hosting to manage your business • 6 off Celltime vending terminals including a demonstration case • 12 Sets of battery packs, 6 off Table top chargers and manuals • 6 off Pay-As-You-Go SIM cards with 3 months GPRS • 18 Rolls of paper and 6 spare ribbons • R5000.00 Float to start trading immediately • 6 sets of advertising stickers • 18 off Printed T-Shirts • 12 off Printed Caps • 6 off Printed “Drymac” • 6 off Whistle to attract attention • National Corporate Identity Sell where ever there is GPRS signal

  10. SIMPLE TERMINAL OPERATION • The CELL-Time Terminal is a Portable Mobile GPRS enabled Terminal providing real time on-line connection to a back-office administration, designed to dispense Pre-Paid Cellular Airtime and in future other pre-paid services. • The Terminal provides for PIN and PINLESS transactions and is equipped with a printer to supply receipted evidence of service sale. • Individual Vending • The system works on a purse (float) based business model, and means that there is no physical stock reserved for the terminal. As a vendor you no longer require to keep records of existing stock, sold stock, or what stock to order. You also do not land up stocking difficult to sell vouchers! YOU BASICALLY SELL WHAT EVER YOU WANT, WHENEVER YOU WANT ALL DAY EVERY DAY (24/7)*! We provide a stock pool from which you draw from at the time of sale. Your only concern is that there is sufficient money in your purse to do the required sale. This means that with a small amount of money in your float you can be in business. Simply deposit a minimum of R500.00 in to our bank account, and with in a few minutes (Monday to Friday banking hours), your machine is updated and ready to sell pre-paid services. At the end of each day/shift, the terminal can be made to print the sales that were made, with the actual profit that was made for the vending period. With a daily print out, a full control of your business is possible. • * Provided that the required voucher is a valid request and available at the time of sale. Whilst every effort is made to ensure continuous stock, circumstances beyond our control may cause some items to be temporarily out of stock.

  11. MULTIPLE VENDING MACHINES • Multiple Vending Machines • If your business requires more than one machine, then you can subscribe to our Manager Model. This means that you will have access to your personal web page, have an improved discount structure, and monitor the terminals registered to you. You can do full reporting and print outs as required for each terminal, set each terminal’s discount structure, and even make a commission on every voucher sold. You can control each terminal individually, and even update the purse as required. In this case you would make a lump sum deposit into our account, and then dispense the float as required by each terminal. The minimum requirement is an internet subscription and a connection from your local service provider. This allows for access from any where in the country, in fact the world, provided you have an internet connection.

  12. SIMPLE BUSINESS MODEL • If you sell an average of R500.00 a day, and you make a Nett Profit of 7% average on your sales, means that you make a total of R35 a day using your terminal. Whilst this does not sound much, the cost of running the business is negligible when compared to a standard scratch card type of business. Firstly you have to physically collect the stock from your supplier, incurring transportation costs, both to and from the supplier. Secondly you have to purchase stock for at least one weeks trading, to make re-stocking viable, which means that you have to invest a minimum of R3500 worth of stock, but you now have to predict your sales when you purchase your R3500 of stock, because that is all the money you have. Quite difficult. Thirdly you have to carry this large amount of cash on you when purchasing your stock, easy prey for thieves. Fourthly your physical stock is money, so any voucher lost or stolen means LOST money!

  13. NO STOCK REQUIRED • With our system, your stock is as close as the nearest bank, and means that you can deposit daily a smaller sum of money, making the risk lower, but with all the added benefits, SELL WHAT EVER YOU WANT, WHENEVER YOU WANT. This means that you give your customer better service. Experience has shown that our vendor’s turnovers increase by up to 40% when changing to our terminal, simply because they have stock all the time.

  14. LOW RUNNING COSTS • Every system has a running cost, however the running costs are low when compared to other systems, especially when it comes to the better service that our system provides. Using an MTN ‘ Pay-As-U-Go’ SIM card for example, a minimum monthly charge for GPRS usage will be R10.00 for a 10Mbyte bundle. This must be loaded every month, and we recommend that the subscription option be selected to ensure a continuous operation, the only requirement is that you maintain a minimum of R10 airtime on your SIM card to ensure the subscription can take place. Topping up of airtime is simply to sell yourself a voucher, and loading it on the terminal just as you would do with a normal cell phone. There is a R0.13c transaction charge, VAT included levied for all successful transactions processed by our Server. The transaction is charged at the time the transaction takes place. However the running fee is negligible when compared to the amount of time spent doing standard stock checks and rechecks. • Voice Calls • The terminal has the facility to receive and make voice calls, however this is not intended as a public telephone, but is there for user convenience. This option is also used for topping up airtime, and purchasing GPRS bundles.

  15. Distributor OPPORTUNITY • WhatOurBusinessOffers • EXCLUSIVE Product in all AREAS • The opportunity for the Distributors to manage and control their own terminals operating in any area. • GREATER PROFIT MARGINS • Opportunity to grow margins to 33% per month from a very low airtime capital through rotation of initial investment. • ZERO THEFT RISK • No stock is carried on-site – thereby reducing the risk of theft and simplifying stock control. • LOW RISK STOCK MANAGEMENT • Real-time logging of all transactions carried out keeps accurate records of all stock movements.

  16. Distributor INCOME ILLUSTRATION Discount Margin 1.5% Daily Airtime Turnover Airtime Capital R1, 015 R1, 000 Daily Gross Profit Monthly Gross Profit R15.00 R330 X 20 Days p.m. Return on initial airtime investment of R1, 000 equals 33% p.m. Multiply this figure by the number of working terminals. Excludes any return on rental, and assumes the machine was sold to the vendor.

  17. FACTUAL PRODUCT PERFORMANCE • MANAGER: A. xxx TERMINAL: 0402xxxxx25

  18. Typical Vendorusing corporate colours

  19. FACTUAL PRODUCT PERFORMANCE MANAGER: A. xxx TERMINAL: 0402xxxxx25

  20. How a Vendor makes his Profit

  21. FACTUAL PRODUCT PERFORMANCE MANAGER: A. xxx TERMINAL: 0402xxxxx25

  22. FACTUAL PRODUCT PERFORMANCE • MANAGER: Cell-Time Contracts TERMINAL: 040xxxxxx74

  23. VIRTUAL AIRTIME BANKING WAREHOUSE Airtime Credit Cash SERVICE PROVIDER / SUPER WHOLESALER Microsolve 6-12.25% Discount 6-12.25% Discount DISTRIBUTOR 1 DISTRIBUTOR 2 6% Discount 6% Discount 5-11% Discount RENTED Terminal RENTED Terminal SOLD Terminal SOLD Terminal

  24. DISTRIBUTION CHANNELS COMPARISON Cell-Time Direct Channel Conventional Airtime Channel Service Provider Service Provider Super Wholesaler Celltime Network Wholesalers Resellers Distributors Retailers Resellers Consumers

  25. TRANSACTION MODEL CELLULAR NETWORK CUSTOMER’S CELLPHONE INTERNET CELLULAR DATA TRANSMISSION RECHARGE PIN FRANCHISEE’S AIRTIME FLOAT ACCOUNT CELL-TIME TERMINAL CELL-TIME SERVER SYSTEM SERVICE & AIRTIME VALUE ENTERED INTO TERMINAL VIA KEY PAD

  26. DISCOUNT STRUCTURE TERMINAL COSTS (Excl. VAT): DISTRIBUTOR PRICE – R3,880.00 SUGGESTED RETAIL PRICE - R4, 850.00 Typical Discounts at time of data preparation Discounts subject to change with out notice. Please contact Microsolve for latest discounts.

  27. BENEFIT TO THE DISTRIBUTOR • ADVANCED TECHNOLOGICAL SYSTEM • Cell-Time Direct provides entrepreneurs with the technology • that enables them to claim their portion of the billion Rand a • month pre-paid airtime industry. • EMPOWERMENT INITIATIVE • An Entrepreneur with vision, enthusiasm and desire to • operate his/her own sustainable business will be provided • with the necessary tools and systems to enable them to • operate profitably in this lucrative market. • WIN-WIN SOLUTION • The more airtime sold, the more money you earn. You • earning money makes us money and so we have a WIN- • WIN solution.

  28. BENEFIT TO THE FRANCHISE HOLDER • REAL-TIME MANAGEMENT • Our Cell-Time system is designed to enable you to manage • your business. With us as your Virtual Partner, the system • provides you with an up-to-the-minute profile of your Airtime • Sales business. This includes a complete accounting record • of all Airtime sold and a statistical analysis of your sales • initiatives. • NO CONTRACTUAL OBLIGATIONS • Our system is also designed on a “pay-as-you-go” principle. • Simply buy your Airtime from us, sell it, and buy more airtime – • of course you keep your share of the sales. You can purchase • Airtime from us in amounts that suit your budget.   • THEFT-PROOF SYSTEM • To sell our Airtime you are no longer required to purchase a • stock of “physical” cardboard Vouchers which represent an • irresistible target for the criminal. We use electronic vouchers • which incorporate bank-level security.

  29. BENEFIT TO THE FRANCHISE HOLDER • EFFICIENT STOCK MANAGEMENT • Your business runs on a float, this means no more • unnecessary or unwanted stock, or over stocking on a slow • mover. You simply purchase vouchers as required, as long as • you have a positive float, you can sell. When your float is • depleted, simply deposit money into our account, and we will • update the float to the value deposited.    • RELIABLE CASH MANAGEMENT SYSTEM • Printouts are available for daily transactions, and the terminal • even has a facility to cash up your terminal. No more guessing • what sold, simply press a few buttons, and the answers are • printed.

  30. ADVANTAGES TO THE USER • EFFICIENT OPERATIONS • Our Terminal is connected via cellular data network (GPRS) to • our Server. This enables complete management control over • the use of the Terminal and associated sales. Our Terminal • does not require the use of a telephone line or have to dial up • (usually at your cost) the service provision computer system. • FLEXIBLE AND PRACTICAL • Our Cell-Time Mobile Terminal enables both walk-about • Vending and Countertop operation. • EASY TO USE • Simply select the Airtime Service Provider requested by the • customer and input the Value of Airtime required. In less than • 4 seconds the transaction is completed with the production of • a paper receipt showing the recharge PIN number and other • essential transaction data.

  31. ADVANTAGES TO THE USER • REAL-TIME TRANSACTIONS AND MANAGEMENT • Meantime the Cell-Time Terminal has been communicating with • the Cell-Time Server and has updated all records associated • with your particular Airtime account. • All management records of transactions and sales value, use of • airtime and other statistical information being made available via • your Terminal or by connecting your PC on Internet to our • secure Server and using your Username and password to • access your daily, weekly and monthly sales data. • Microsolve is able to purchase bulk Airtime and • pass the benefits of such discount onto the Resellers direct.

  32. TERMINAL CONFIGURATION RECHARGE AIRTIME VOUCHER BUILT-IN PRINTER FOR RECHARGE PIN RECEIPT Ear piece For Voice calls BACKLIT DISPLAY WITH SIGNAL INDICATOR BATTERY – OPERATES ALL DAY ON ONE FULL CHARGE SHOCK-, DUST- AND WATERPROOF KEY PAD TOUGH PLASTIC CASE

  33. TERMINAL CONFIGURATION The Cell-Time Terminal is able to operate as a completely mobile hand-held device on-line to the Server at all times. This is ideal for mobile vending both in-store and on the street. The Terminal battery will power it throughout a full day enabling over 200 sales on a single battery charge. All transactions are logged and recorded on the Server and the Manager of a number of mobile vending terminals is able to monitor all transactions on individual terminals. Unlimited Airtime may be dispensed through the Terminal – It cannot run out of Vouchers if it’s Airtime account is maintained.

  34. TERMINAL CONFIGURATION • The Base Unit shown in the picture • on the right provides power for the • Terminal when operated in a • Counter-top configuration. The spare battery in the Base Unit is always charged when the AC/DC adaptor is connected. When the Terminal is placed in the cradle of the Base Unit then it’s internal battery is also on charge. The Terminal may be operated without interrupting the battery recharge cycle. A full battery charge will require the Terminal to be charged overnight.

  35. CELL SYSTEMS WEBSITE INFORMATION • There are three websites available to the system • distributers, these are: • Development Site • This is where new software is written, and tested while being • developed. This site is only available to the Cell-Time • development engineers. • Demonstration Site • Once the software has been tested, and is performing • according to program specifications, it is transferred to the • demonstration site. This site is extensively used for testing with • real time live data, demonstration of our equipment to potential • clients, and on occasions, product training. • Main Site • Once the software is tested on the demonstration site, it is then • transferred to the main site. The time of transfer is so chosen • during periods of no activity, to reduce down time. This transfer • can take up to 30 minutes. All data is backed up, and each • module is loaded, checked before final release.

  36. DISTRIBUTOR WEB ADMIN GUIDE Log In This entry is required before viewing of the web site. The manager must enter a user name and password.

  37. DISTRIBUTOR WEB ADMIN GUIDE List My Terminals Use this menu to see the float values of all the terminals registered to the manager. Typical data displayed is Terminal name and number, buy limit (float balance), alarm level of each terminal, reduced alarm level (level below which voucher sales will be penalized), and terminal type – manager or vendor.

  38. DISTRIBUTOR WEB ADMIN GUIDE Profit for Today When the manager would like to see the transactions of his terminals for today, this menu selection is selected. The screen will then load the transactions.

  39. DISTRIBUTOR WEB ADMIN GUIDE Cash-ups Performed Today When the manager wants to see what cash ups took place today, the manager will double click this menu selection. The cash ups for all terminals will be displayed.

  40. FREQUENTLY ASKED QUESTIONS • Q: Do you guarantee my Airtime Discount & for how long? • A: Discounts are subject to change without prior notification in accordance with the air time service providers • Q: If I can buy Airtime cheaper elsewhere will you match • it? • A: We will review any written offer and calculate if we can • match it or improve on it. • Q: Where do I get ribbons and paper? • A: Microsolve Pty Ltd • Q: How do I get my Terminal repaired or serviced? • A: Call Microsolve Pty Ltd

  41. FREQUENTLY ASKED QUESTIONS • Q: How do I stop people accessing my Terminal? • A: By diligent and secure use of your SIM PIN and Terminal PIN • Q: Is my Terminal insured? • A: This task lies with the distributor or terminal owner, however if you require insurance we use our own policy for costing only R33 per month excluding V.A.T. – terms and conditions apply. • Q: What do I do if my Terminal is lost or stolen? • A: Ring Microsolve immediately with Terminal Number • Q: Can I use an Alternative Lease/Rental Scheme to • acquire the Terminal? • A: Yes – we will provide you a Tax Invoice.

  42. FREQUENTLY ASKED QUESTIONS • Q: What is the minimum Airtime I can purchase? • A: R1,000 at time of terminal Purchase – Minimum R500 per terminal thereafter. Do remember if you deposit cash, there is a 1% cash deposit fee. • Q: Do I get improved discount rates if I sell lots of Airtime? • A: As a distributor we are getting maximum discount. AS a terminal owner, we will revise the sales figures. • Q: How long does it take to top-up my Airtime Float account? • A: Usually within 5 minutes of your deposit but if payment is made by Cheque, it can take considerably longer. Once you have proof of transfer it takes our Computer Server 30 seconds to update your Airtime float account. • Q: Why Do I have to pay for a SIM Card? • A: Because you’re Terminal communicates with the Microsolve Server via Cellular GPRS Data service.

  43. FREQUENTLY ASKED QUESTIONS • Q: What happens to my Airtime if I cancel the contract or go out of business? • A: Once any outstanding amounts are settled then the balance of any outstanding Airtime is fully refundable as airtime vouchers. • Q: Can I buy Printer Ribbons and Paper from any • Supplier? • A: Yes – Although Microsolve’s warranty on equipment will be void. • Q: Can I get Daily/Weekly/Monthly Management data in computer format? • A: You will get access to our Secure Web site with a Username and Password once you have purchased a Terminal. From this site you can get all Management information regarding your account and usage statistics.

  44. FREQUENTLY ASKED QUESTIONS • Q: Is this terminal approved by SA Cellular Operators? • A: Yes • Q: Can I sell anywhere with my Terminal? • A: Yes provided there is GPRS service in the area • Q: Can I take my terminal home at weekends and sell • Airtime? • A: Yes • Q: What other Services can I sell and when? • A: It’s Cell-Time Direct’s intention to add further Pre-paid • services including Bulk SMS, Bulk MMS and pre-paid • electricity in the near future.

  45. FREQUENTLY ASKED QUESTIONS • Q: How many receipt rolls can 1 Ribbon print? • A: 750 to 1000 depending on your usage of additional account • information print outs. • Q: How much do replacement batteries cost? • A: Your battery should last 5 years if properly looked after. See • consumables price list. • Q: How long does a fully charged battery last? • A: The equivalent of 200+ transactions (with receipts printed) • per day, or 40Hrs on standby. • Q: Can I get out of hours support? • A: Yes but you need to previously agree this with us.

  46. FREQUENTLY ASKED QUESTIONS • Q: Am I at risk with the Airtime Value in my Terminal? • A: In the event an unauthorized person misuses your PIN its • possible that you’re Terminal could be used to sell Airtime. • However we suggest you use the TERMINAL FLOAT • command to limit the amount of value in the Terminal. This • ensures your master Float Account is protected. • Q: Can I stop my Terminal Operators (Vendors) accessing • Management Information? • A: Yes – Each terminal’s data interrogation is limited • accordingly. • Q: Does the Terminal interfere with other electrical • equipment? • A: The Terminal should be treated as a Cellular Phone. You • should obey the same restrictions on use as you would a • Cell phone e.g. don’t use it on Aircraft, Garage Forecourts etc.

  47. FREQUENTLY ASKED QUESTIONS • Q: Is there a Training course/session for Distributers and Terminal Vendors? • A: Yes – we train the distributors, who in turn will train their Vendors • Q: Where do I get Advertising Signage and stickers? • A: From Microsolve head office • Q: Do I require to adhere to the Microsolve • corporate Cell-Time identity? • A: Yes it is a prerequisite. • Q: What corporate material does Microsolve Marketing • supply? • A: Shop window stickers, T- shirts & Caps & banners.

  48. FREQUENTLY ASKED QUESTIONS • Q: Can I take the Terminal into any Cellular Repair • Agency? • A: No – Call Microsolve. • Q: Why does the Terminal have such a large Aerial? • A: To give improved reception in areas of poor signal strength. • Q: What happens if there is a break in the Cellular Service? • A: This is very rare and in such an event it will last only a few seconds however your may need to reset the SYNC facility between your terminal and our Server. See the Users Guide on how to do this.

  49. FREQUENTLY ASKED QUESTIONS • Q: What’s the advantage of the Terminal? Why can’t I just use Vouchers? • A: You can run out of Vouchers. You have to also have to hold • slow moving stock which wastes financial resource. • Vouchers are a crime risk. With Vouchers you have to • provide the reconciliation service. With Cell-Time Direct you • never have to worry about what vouchers you have in stock • – all of them are always available. • Q: If one of our Customers says the PIN didn’t work what • happens? • A: The customer must contact the Service Provider first, then if there is a problem with a voucher, Phone your Agent who will contact Microsolve Marketing. • Q: What if the way Airtime is sold changes? • A: In the unlikely event that Airtime providers change the • method of Airtime delivery, Microsolve Marketing will make • the necessary changes to the Terminal on a free of charge • basis.

  50. FREQUENTLY ASKED QUESTIONS • Q: What is the advantage of Rental? • A: As a Distributor, this is one way in which you can have a faster return on your investment with out having to rely on airtime sales for annuity income. • Q: Vouchers are quick to serve as there is no printing – • how do I deal with a queue waiting for Airtime using the • Terminal. • A: The Cell-Time Terminal takes less than 20 seconds to • complete an Airtime sale. In the event you need to serve • faster than this then you can Pre-print an appropriate • quantity of the most popular voucher values and keep them • safe in your till. This way you have an immediate sale but • benefit from the electronic records kept by the Terminal.

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