Million Dollar Expansion Plan for Australia

An ink and toner wholesale and retail group has released an Expression of Interest (EOI) document seeking Chinese partners who will invest over US$40 million to massively expand its operations, in Australia.

Inkspot Franchising Pty Ltd, which already owns 33 stores, primarily in the Eastern States of Australia, told RT Media they are planning to combine their 160+ store expansion over 4 years with a commercial property acquisition strategy.

Vincent Teubler, Managing Director at Inkspot believes, “By combining our store expansion plans with a commercial property acquisition strategy, we will be able to mitigate a lot of the risks whilst concurrently significantly expanding the ROI. MacDonalds is obviously a pretty spectacular example of a highly successful organisation built around property acquisitions.”

Regarding the benefits for the potential investors, Teubler revealed, “We are ideally seeking a single investor capable of investing over US$40 million dollars, primarily in Australian Commercial properties over a 4 year period. As the lead investor, they would be provided with a majority position in the commercial property group and a position in Inkspot itself. We will offer a solid rental yield on all properties with Inkspot as the prime tenant and 100% occupancy rates. The capital growth on the retail properties is also potentially significant given the historic stellar growth on commercial property values in Australia. We will also offer a fixed yield on their Inkspot investment and obviously dividends in line with their shareholding.”

In addition, Teubler told RT Media that what the long term benefits for the investors will be, “At some points, Inkspot can obviously exit independently of the property group yet leaving a solid long term tenant. The flexibility exists for Inkspot to exit at a trade or even IPO level with significant ROI assuming we remain focused on the profitable expansion of the core Ink and Toner network, which is of course the underlying intent. That would leave us with a very significant commercial property portfolio across Australia.”

Teubler also explained why he is looking for investors in China, “That’s very simple. Our product is all sourced in China. A Chinese partner would be able to very simply assist us in improving the cost and quality base of our Chinese supply. Additionally the Chinese have a very good understanding of the stability in property investment both at a retail and commercial level in Australia. As to growing and running Ink and Toner retail business in Australia, that’s our expertise. Together with the right Chinese partner we will make a very formidable partnership.”

Inkspot, commenced operations with a single store in Melbourne in 2007, owns their existing stores, including company owned stores, franchises and distributors, selling Inkspot branded aftermarket and remanufactured Inks and Toners.

“We had grown organically to some 30 stores earlier in the year,” said Teubler. “We had completed putting in an operational infrastructure which enables us to continue to be driven by good sales skills. Also, we added a consistent operational framework from product manufacture through to customer deliver. Therefore, we were able to see an enormous expansion opportunity in the Australian market.”

According to Inkspot, Officeworks—a megastore office supply store network owned by one of Australia’s largest listed companies—is one of their prime competitors in Australia. Another is Cartridge World, a franchise network recently purchased globally by SGT in China.

Teubler explained, “Creating a network of small retail stores across Australia with the benefits of central ownership and management was extremely enticing. The capital requirements of Inkspot to facilitate the growth are not huge in and of themselves. However, we are very keen on getting the flexibility and control over the retail properties which we would have to lease.”

Inkspot has placed its investment documents (Expression of Interest) online and for a small fee charged by the website any interested party can download the detailed information. Please click here for more information.

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