Al RIFAI ROASTERY Development Plan Highlights

Egypt

MACRO FACT SHEETEGYPT

Egypt Macro - Fact Sheet

Total Egyptian Population 90,000,000

Geographic Relevant Population (Cairo + Giza + Alexandria + Red Sea Urban+ Delta Urban) 40,000,000

Relevant Age Grp (15-64) 25,000,000

Relevant Income Level (30% - income level LE 15,000+) 7,500,000

Males (50.4%) 3,780,000

Females (49.6%) 3,720,000

Relevant population Avg Monthly Spend on Food & Beverage - Estimate (LE) 3,100

COMPETITION MAPPINGAL RIFAI EGYPT

Upscale Roasteries (Direct Comp) # of Shops Avg PSD Sales - LE Product Range

AL RIFAI 2 Nuts, Coffee, Confectionery & Gourmet Food

ABU AUF House of Nuts 26 Nuts, Coffee, Confectionery & Gourmet Food

Lebanese Roastery 15 Nuts, Coffee & Confectionery

Mowafak Roastery 15 Nuts

Upscale Roasteries - Egypt 15% 15% 15% 15% 15% 15% 10% 100%

Brand Share of Voice

Penetration

Growth Potential

Menu Functionality

Service Quality

Quality Perception

Value Perception Total

Al Rifai

Abu Auf

Lebanese Roastery

Little Caesars

o Al Rifai shows the highest potential for growth, Service Quality, Quality Perception & Value For Money Perception

Avg PSD Sales for Line-store =

Avg PSD Sales for Mall Shop =

Food cost of mixes: 006% (Classic/Assorted Mix) up to 00% (Healthy Trim Mix)

Healthy Trim Mix included 00 ingredients one of which was the Goji Berries

Avg GP% of total product mix = 00% - Weighted Avg GP% of total product mix = 00%

Avg Check = LE 000 (Ramadan Season = LE 000)

Sales Mix of Key Categories:◦ Nuts (Raw & Roasted) = 00%◦ Coffee Sales represented 00%◦ Gourmet Food = 00%◦ Chocolate = 00%◦ Tea = 3%◦ Malban & Mulabas = 00%◦ Dried Fruits, Herbs & Spices = 00%

BRAND HISTORY OVERVIEWAL RIFAI EGYPT

Note: The drops displayed were basically due to OOS situations

o Total Sales from (Aug 14th 2014 till August 11th 2015) =

o Sales Mix of Al Rifai Egypt:o Single Nuts = LE 2,397,769 = 00%o Nuts Mixes = LE 829,423 = 00%o Seeds & Crackers = LE 233,249 = 00% (CFC Shop sold 30% of that category higher than CTS Shop)o Malban, Chocolate & Sweets = LE 332,971.35 = 00%o Coffee & Cardamom = LE 123,146 = LE 129,792 = 00%o Dried Fruits = LE 235,391 = 00%o Baskets & Gifting = LE 41,916 = 00%

o Important to Note:o Shops in the surroundings of a hyper market will tend to sell more of the inexpensive itemso Customers in general tend not to be temped y offerso Sales mix numbers might not be 100% indicative due to: Repetitive OOS situations + System errors o Items like Zaatar, Popnuts & Seed Kernels were pretty much appreciated and demandedo There is still more room for items like: Mouneh, Dates, Coconuts,..etco Coffee, Chocolate & Gifting are of high potential; their growth was challenging due to OOS situations also

Strengths Weaknesses Product Range, Variety & Quality Logistical Challenges

A VERY strong brand nameHigh Landed Food Cost due to: importation is small

volumes + incurring high labor and processing cost of Kuwait until it lands in Egypt

Strong organizational support

Opportunities Threats Nuts consumption is growingly becoming part of the

Egyptian cultures Increasing rents in premium malls

HORECA clients showed a great interest to switch to Al Rifai Political instability

Logistically Egypt is a very sound location for a regional business set up Central Bank regulations

Real Estate cost I& Labor cost are comparatively very low

We have managed to realize Ramadan Season Sales (17 days: Jun1 - Jun17) of LE 336,750, given the absence of the following key Ramadan products: Key Ramadan products: (e.g: Kamaridine + Mouneh + Dates + Tamarind + Coconuts + Baklava +

Pine Nuts + Peeled Pistachio) Important Ramadan Packaging that made us miss a lot of corporate & external sales orders

Ramadan Sales Highlights are: Avg Daily Sales of Ramadan Season: LE 19,809, growing from LE 11,732 in May 2015 (68.8%

growth) Avg Daily Trans: 127 Avg Check grew from 118.5 of May 2015 to 156 (31.6% growth)

We have managed to totally smooth out the logistics of the shipping and clearance We have pin pointed the system glitches/errors that have been causing reporting unreliability We have tentatively concluded (waiting for the final finance confirmation after solving the system

glitches) that we have been realizing around 44% GP instead of the budgeted 35% We have managed to locally source very important products (that are either costly or logistically difficult

to ship from abroad due to small size): e.g: Kamaridine + Baklava + Dates + Chocolates + Tamarind + Coconut

We have submitted P&L/Feasibility studies for a couple of potential new locations, subject to management consideration within the planned expansion strategy

PLANNING HIGHLIGHTSAL RIFAI EGYPT

Achieving the economies of scale in order to efficiently utilize the Overhead expenses

Al Rifai be number one nuts and dried fruits retailer with a 90% penetration level of the key cities and urban sub-regions (Cairo, Giza, Alexandria, Mansoura, Damietta, Sharm El-Shiekh, Hurghada

A goal of 30 shops in 5 years should be very achievable

Multi-food Al-Homaizi to be number one wholesaler controlling at least 30% of the HORECA & corporate business

Multi-food Homaizi should own and operate at least 30% of Al Rifai retail shops, while acting as a brand guardian with the franchised business by closely monitoring the operation of the franchised business and ensuring their compliance with the guidelines

One or two (maximum) franchisees may be considered each covering certain regions

Operational Manual, Marketing Manual & HR Manual tailored for Al Rifai-Egypt need to be designed/customized for own shop’s operations use as well as franchisees’

Enhancing profitability, raising the GP% from the budgeted 35% to at 50% by the end of the second year; that can be achieved by: Smart and selective Local Sourcing of certain items Increasing staff efficiency & productivity with practical incentive schemes Refining the cost-price figures displaying the actual GP (estimated 11% to be added to the bottom line/GP%)

Franchise agreements can be considered to guarantee: At least 2 new openings a year in strategic areas Strong brand presence in key areas in Cairo & Alex by the second year

Permanently solve the system errors (with the direct involvement of Finance & IT Teams) and train staff on using it

By mid of the second year, all pending logistical issues should be sorted out: Smooth Importation of the food shipments thru the sister company’s license Arranging for the Dry Shipments clearance

Malls are strategically crucial to be present at (e.g: City Stars + Mall of Arabia + Cairo Festival City + Carrefour City Center Maadi + Carrefour City Center Alex + St. Stefano Alex +

Main Cities in order of significance: Cairo + Alexandria + Mansoura + Port Saed + Sharm El-Shiekh

Duty Free is quite significant to open a shop in but only after getting established in the main City (Cairo)

List of areas/streets recommended for a flagship & in-line-stores in Cairo & Alex: Mohandesin: (Parts of Jamiet Al-Dowal + Jazeret Al-Arab + Lebnan St.)Dokki: (Mosaddak St. + Mohie El-ddin Abu El-Ezz)Heliopolis: (Merghany St. + Korba + Omar Ibn El-Khattab + A.Aziz Fahmy St.)Maadi: Degla + Road 9Zamalik: Brazil St.Nasr City: Abbas AkkadAlex: Smouha + Miami + Ma’moura + Kafr Abdou

Communication Until the number of shops reaches 6-10 shops, ATL communication is recommended; a lot of LSM

functions can be much more effective and efficient Tie-ups proved (when applied on a small scale) to be effective at this phase

Offerings Product-on-product is the tactic always followed in our premium brand case, although was not of a great

appeal to our customers who come to us for our fine quality not the promotion and direct discount Branded give-away premiums can be a great branding and promotion tool in our case, especially that we

can get the HO support in that

Pricing: We have been applying a premum price positioning and we should maintain that, keeping an eye on

competition; 30%-40% over competition’s pricing did not seem to turn off our customers; yet, we should be careful not to go higher unless it is a necessity

Local sourcing can guarantee a good GP%, the matter that should make us price our items comfortably, not fearing to be too expensive

HORECA B2B Approaches: Opportunities are very high; however, we can not cater to that confidently unless we grow in volume so

that have enough stocks to cover our HORECA demands without fearing OOS or prodct waste situations

THANK YOU

PREPARED BY:

MOHAMED A.RASHID IBRAHIM

CELL#: +201004220013

HTTP://EG.LINKEDIN.COM/PUB/MOHAMED-IBRAHIM/32/104/2B

AUGUST 2015