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Veritas Instrument Rental Incorporated
v9.0 (5/11)
Instrument RentalAffiliate Program
Veritas Instrument Rental Incorporated3670 131st Ave North • Clearwater FL 33762
Toll Free 877-727-2798 • Toll Free Fax [email protected] • www.veritas-online.com
Make Money RentingSchool Band & Orchestra Instruments
Make Money RentingSchool Band & Orchestra Instruments
Looking for a great way to increase sales, service, profits and your customer base?Within as little as one week, Veritas Instrument Rental can custom build (or rebuild) a highly competitiverental program for your business complete with full color brochures, inventory and the forms,documentation & training necessary to get rolling. Your customers will think you’ve been doing thisfor years. Your competition will never see you coming!
What makes Veritas one of the fastest growing providers in the nation? Our relationships.Our objective is to cultivate & maintain mutually profitable relationships with our affiliated retailers &service professionals. The operation of this program has been readily simplified over the yearsbased on the ideas & suggestions of our affiliates. The result: A well documented, streamlined,turnkey rental program that works. We regard each and every affiliate as a partner in success, not justanother agent working on our behalf.
Shared Knowledge. Shared Sucess.There’s only so much one can learn from a manual. We go the extra mile to include interactiveweb-based training, quarterly service & marketing seminars at our training facility and even in-storepresentations. Because we’re only as strong as our weakest link, we want to be sure our affiliatesare empowered with confidence as they greet their new rental customers.
Operate your own program? Working with another company? Just getting started? Let's talk.Most independent rental operations are plagued by poor cash flow, aging inventory and collectionsnightmares. Several Veritas affiliates, once frustrated with their own program, are making more moneynow than ever. While their greatest fears included giving up control and profits, all they really gave upwas the administrative stress & overhead. Many satellites for other companies are either experiencingrecourse on uncollectable accounts or finding themselves competing against their provider's retail stores.We handle all of the billing & collections and have no retail stores to compete against. Because there isno franchise fee, inventory outlay or initial expenses required to participate in this program, the startupbusiness owner can immediately offer a proven rental program to his or her customers with nofinancial commitment or advance market research.
What separates Veritas from the others? We eat, sleep and breathe this stuff!In addition to a high-percentage monthly commission & per-contract bonus, Veritas affiliates also benefitfrom updated school market data, rental brochure distribution to the schools within their market,cooperative advertising opportunities such as imprinted music folios, outdoor banners, teacher planningcalendars and access to vast industry resources offered by national organizations & manufacturers.
Professional Marketing SupportYou’ll be provided with valuable school market data identifying the music programs and teacher contactnames in your area. Custom flyers (with your store name and logo) are mailed to every school bandand orchestra director on your behalf at no cost to you. Cooperative opportunities include music folders,teacher planning calendars, cable television templates and community sponsorships.
No Collection HasslesOur experienced collection department handles all of the billing, late notices, reminder phone callsand repossessions. There is no recourse to you when a rental account is uncollectable.
Educator-Approved Name BrandsWe have the brands teachers want like Selmer, Bach, King, Conn, Artley,Armstrong, Benge, Holton,Vito, Besson, Buffet, J. Keilwerth, Jupiter, Gemeinhardt, Emerson, Regent, Knilling, Hermann Beyer,Scherl & Roth and more. In addition to beginner model instruments, we also rent-to-own upgradesand specialty instruments. Our in-house upgrade exchange promotions will ensure your customers willnever outgrow your program.
Flexible Service ArrangementsOur first priority: Fast friendly service. Are you equipped to service instrument repairs? We’ll compensateyou for taking care of the service needs of your new customers. Looking for repair training? Come ondown to our facility for personal one-on-one repair training (no classrooms!) and stay as long as you like.Would rather have us repair the instruments? No problem. We utilize the United Parcel Service ARSsystem and can quickly take care of your customer’s service needs, regardless of location.
Paramount Affiliate SupportVeritas Instrument Rental will provide continuous training to familiarize you and your employees with ourprogram. Other areas of support include monthly newsletters, in-store promotions, a yearly affiliateseminar/convention and seasonal marketing memorandums.
Increased Convenience & Buying PowerAll of our inventory including new, like new, used, display and loaner instruments are available forimmediate rental or sale at a substantial savings. You’ll never have to worry about a master order again!
Pay Nothing to Get StartedFranchise fees? Inventory investments? No way! Everything you need to get started as a Veritas affiliateincluding instruments, training, flyer distribution and market data will be provided to you at no cost.
THE BEST PART: The Monthly Commission You Deserve!Each month, you’ll receive a detailed receivable statement showing exactly how much rent we’vecollected from your customers. Because we offer outstanding in-house collections, a high-percentagemonthly commission and a bonus for every new contract you write, we’re confident that we arethe industry leader in profitability.
Veritas Affiliate ProgramFeatures & Benefits
Veritas Affiliate ProgramFeatures & Benefits
Are you living in a collections and master order nightmare? Is your volume outgrowing your inventory,payroll and repair capabilities? Would you like a stream-lined band instrument rental operation withoutthe hassles and overhead? Veritas can help. Consider these benefits:
Say Goodbye to Collections, Inventory Commitments and Cash Flow ProblemsImagine never having to make another collections call on a Saturday afternoon, never having to deal withmaster order-hungry vendor reps & poor cash flow due to outrageous intro offers. While we're convincedour program is more profitable than most independent operations, the increased "opportunity profit"or gained time that can be spent promoting business, alone, makes us worth serious consideration.
The AMS ConnectionAccount Management Solutions (AMS) is our sister company specializing in the billing & collectionof your receivable accounts. By use of state-of-the art information technology, paramount customerservice and years of experience in the rent-to-own industry, not only can we dramatically reduce youroperating expenses, but also improve efficiency, time management and overall profitability. AMS is nota factoring company and we do not buy paper. We simply keep a small portion of what we collecton your behalf. It's that simple!
Inventory Acquisition Looking to liquidate your inventory? Veritas might be able to acquire your instruments through fieldtransfers, purchase at time of rental or outright cash purchases. Want to continue renting your owninstruments? No problem. The flexible nature of our program allows you to think of us more as a partner,and not so much as a provider.
Increased Convenience & Buying PowerDepending on your terms and discount levels, you may be able to buy single instruments from Veritasat a discount extending beyond your current master order pricing.
Operating Your Own Program?Operating Your Own Program?
Is your rental provider looking out for your best interests? Is your rental pricing competitive?Are you competing with their retail stores? Is anyone helping you with your marketing and advertising?
The Best in Quality, Value and ServiceWhether you're a band parent or an affiliate, you'll appreciate our quality selection of brand nameinstruments, affordable rent-to-own programs free of interest charges and/or service fees,flexible credit requirements and friendly customer service.
Never a Conflict of InterestOur partnerships are mutually profitable. Veritas has no retail stores to compete with, credits all internetactivity to the nearest "brick & mortar" affiliate and protects your operating area from affiliate saturation.
Working Behind the ScenesBand parents usually don't know (much less care) who Veritas is, but may recognize you as the localexpert of musical instruments. And because we have no motivation to promote our name to the end-user,all marketing and advertising support from Veritas is aliassed as your business and promotes yourtrade name (unlike most satellite programs).
Working With Another Provider?Working With Another Provider?
The Cost of Doing Business: Is It Worth It?The following examples outline average commission totals for several levels of rental volume.
The projections for managing an independent rental operation are extremely conservative and do not include inventory overhead, financing (if applicable), or management expenses
Typical Monthly Commission Totals for Veritas Affiliates at Various Volumes
(with average base rent of $20/mo. and a $5 per new contract bonus over a one year period)
Store 1
ExampleStore
150 $650 mo. $0
500 $2200 mo. $0
1000 $4400 mo. $0
Total ActiveRentals
Total MonthlyCommission
CollectionsRecourse
Store 2Store 3
Data Entry
EmployeeTitle
Posting payments, recording and files sales,returns, exchanges and upgrades
Recording purchases & payables, payroll,and sales tax reports. Assists with data entry
$8 per hour10 hours weekly$320 gross monthly$20 per hour10 hours weekly$800 gross monthly
JobDescription
Monthly Incomeper 40hr Week
Accounting
10, 15, 30, 60, and 90-day phone & writtenlate notices, certified letters and repossessions
$8 per hour15 hours weekly$480 gross monthly
Collections
Servicing all rental & billable repairs, recyclesrental returns, gives repair estimates
$28 per hour20 hours weekly$2240 gross monthly
Repair Tech
Updates school database and market research,advertising and promo, display merchandising
$15 per hour20 hours weekly$1200 gross monthly
MarketingRecording new inventory into database,conduct quarterly physical inventory,and troubleshoot discrepancies/shrinkage
$8 per hour10 hours weekly$320 gross monthly
InventoryControl
The Cost of Doing Business: Is It Worth It?
Approximate Monthly Overhead for a TypicalRental Department Effectively Managing 300+ Accounts
(NOT INCLUDING Inventory or Management Expenses)
Can retailers earn higher returns on their capital by outsourcing their instrument rental program?
The addition of an in-house instrument rental program should include careful consideration of the costof capital. We believe an efficient combo retailer can earn much more with their capital dollarsinvested in standard retail inventory (high-turn instruments, sheet music/method books and relatedaccessories) rather than band & orchestra (B&O) instruments to be rented on a month-to-month basis.
The National Association of Music Merchants (NAMM) has reported that combo MI retailers typicallyhave a 1.7 inventory turn. In other words, the retailer's entire inventory (dollar equivalent) is sold1.7 times per year. NAMM also reports overall gross margins are approximately 37%. With this in mindwhile investing $50k into B&O rental inventory, 138 instruments could be purchased at an average costof $365.00 and rented at an average monthly rate of $23.75 (including any maintenance fees).In a perfect world, where all 138 instruments are rented and bringing in $23.75 per month all year,the monthly gross revenue would be $3,277.50 or $39,330.00 annually. However, the gross profitwould only be $21,631.50 (with a 55% gross margin and 43% gross return on capital). The same $50kinvested into standard retail inventory could yield a gross profit of $49,920.63 or a 99.84% gross returnon capital. Further, by outsourcing the retailer's instrument rental program, the profit potential continuesto grow to a 115% gross return on capital as illustrated below (based only on $50k of investing dollars,not the entire retail operation):
Retailer Outsourcing Rental Program Annual sales from $50K invested in inventory Cost of goods sold Gross profit on sales
Commission from outsourced rental program (138pcs=$39,330.00 with a commission rate of 20%) Gross profit on rental program (no capital invested)
Total gross profit
Retailer Maintaining Rental Program In-House Annual rental income (138pcs rented at $23.75 for 12 months) Allocated cost (55% gross Margin) Gross profit
Veritas instrument return ratios vary from market to market. Most school music dealers would agree,however, that up to 50% of their rentals will be returned during the first year (10% within the firstthree months and 35-40% within the first 12 months). Add the cost of financing, payroll, and collectionsto the equation and you'll see why many independent rental operations are looking to outsource.
This analysis is for illustration purposes only. Actual numbers, formulas and results may vary.Please consult your accountant or financial planner with questions.
B&O or Combo?Where Should You Put Your Money?
B&O or Combo?Where Should You Put Your Money?
$134,920.63$85,000.00
$49,920.63
$7,866.00$7,866.00
$57,786.63
$39,330.00$17,698.50
$21,631.50
Question
Do you own any retail stores that I'll end up competing with?
Am I required to participate in collections process?
Is there any recourse on uncollectable accounts?
Are there any franchise fees and/or startup costs?
Is your business part of a multi-tier or publicly traded entity?
Will you provide me with a list of schools with music programs?
Do you partner with your affiliates at MEA conferences?
Will you distribute flyers to schools on my behalf (at no cost)?
Do you have the best deal on custom imprinted music folders?
Do you offer free repair & sales training throughout the year?
Will you include a per-contract bonus with my commission?
Do you offer interactive online training to your affiliates?
Can I also sell the rental instruments you send to my store?
Will you help me participate in school bids & lease quotations?
Do you offer an accessory catalog I can brand with my name?
Can you react quickly to changes in the market during season?
Do you provide educator-approved name brand instruments?
Veritas
NO
NO
NO
NO
NO
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
YES
Others
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______
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______
______
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______
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How do other providers compare to the Veritas Instrument Rental Program?Be sure to ask the following questions while shopping around:
Beware to CompareWithout Asking These Questions
Beware to CompareWithout Asking These Questions
Nobody beats our selection and quality of band & orchestra instruments. In addition to brand new andlike-new student instruments, we offer hidden model upgrade instruments to meet the needs of your
rental customers. By using non-published models, competition with deep-discount catalog companiesis minimized. We also offer a huge assortment of harmony, specialty and low brass instruments such asbass clarinets, soprano saxophones, cornets, baritones, french horns, euphoniums and even 3/4 tubas!
And talk about brands! We have what the music directors want such as:
Veritas Offers Only the Bestin Quality & Value
Veritas Offers Only the Bestin Quality & Value
Is the Veritas Instrument Rental Affiliate Program Right forYou?Now that you've become more familiar with the resources and potential of our program, you shouldconsider the time & resources you are willing to invest into its development within your business.While we market ourselves to prospects, like yourself, as offering the most complete & comprehensiverental program in the industry, it is important to understand that it will not operate successfully by itself.Thus, your daily participation in the areas of administration, customer service and market developmentis required. Here's a brief overview of what we look for in a prospect:
Knowledge of Basic Business PracticesFrom time to time, affiliates are asked to assist with administrative tasks such as physical inventories,reconciling & resolving discrepancies and customer service. Although our program is well-documentedand readily simplified through the use of multi-part forms, operational manuals and proper training,we ask for good recordkeeping, archiving and inventory control skills from our affiliates.
Establishing RelationshipsAny successful school music vendor will agree that the school music market is relationship-driven.Local music educators are the gatekeepers to your customers (music students & their parents in needof instruments, related accessories and private instruction).Thus, it's no surprise that our TopTenproducing affiliates have cultivated lasting relationships with the educators.They call on schools,participate in rental meetings, support & sponsor activities and even host educator socials. Prospectsnot currently engaging music educators would be expected to knock on doors as a Veritas affiliate.
CommunicationThe success of any partnership (business or personal) will depend on the frequency and depth ofcommunication (for better or worse) between the parties. Because we're dealing with month-to-monthrental agreements and tenacious collections procedures, timely paperwork mailings are required fromour affiliates. It is also necessary to contact our staff members on a regular basis for the purposes ofrequesting additional inventory & marketing assistance as well as mediating customer inquiries.
PerformanceEach market is unique and deserves the benefit of a complete analysis before any expectations areoutlined. In regard to population, number of programs and competition, for example, it would be unfairto size up Atlanta, Texas as having the same potential as Atlanta, Georgia. Nonetheless, it is necessaryto establish a benchmark of performance that makes sense to Veritas and its affiliates.With this in mind,we're looking for prospects who can realistically produce a minimum of 100-150 rentals during theback-to-school season (typically August through October). At this level, our inventory outlay is justifiedand the affiliate's commissions are worth while.
The Veritas Affiliate:What We’re Looking For
The Veritas Affiliate:What We’re Looking For
Complete and mail to:Veritas Instrument Rental3670 131st Ave NClearwater FL 33762Fax to:877-272-7203
Veritas Instrument Rental Incorporated
Affiliate Application
Business Name: ____________________________________________________________________
Business Address: _________________________ City: _______________ State: _____ Zip: _______
County: _____________________ Years at Present Location: _______ Years in Business: _______
Business Phone: ( ) ________________________ Business Fax: ( ) _____________________
Company Website Address: _____________________________________ Sales Tax Rate (%): _____
Business Category(s): ______Retail ______Repair Tech ______Lesson Studio ______Road Rep
Type of Business: ________ Sole Proprietor ________ Partnership ________ Corporation
If Subsidiary, Name of Parent Company: _________________________________________________
Currently Renting Instruments? _____ If yes, what is your rental volume from Aug-Oct? __________
Are you working with another rental company? _____ If yes, with whom? ______________________
Please list your (possible) competitors: __________________________________________________
Number of school music programs in your area? ______ Elementary ______ Middle ______ High
Are you currently in contact with music educators? _______ If yes, in what capacity? ____________
________________________________________ If no, are you willing to initiate contact? ________
Are music educators hosting rental meetings at the school? ______ If yes, will you attend? ________
School music market observations: _____________________________________________________
How did you hear about us? __________________________________________________________
Principals of Business (Please provide your HOME address and telephone information):
Name: ___________________________________________ Title: __________________________
Home Address: ___________________________ City: _______________ State: _____ Zip: _______
Home Phone: ( ) ______________ Email: ____________________ SS Number: _____________
Please note that by signing this Application, you are authorizing Veritas Instrument Rental Incorporatedto conduct a business and/or personal credit check.
Signature: X ____________________________________________________ Date: _____________
Veritas Instrument R
ental Incorporated
Affiliate Competition Analysis
Your Store Name: ________________ Your Nam
e: ___________To be com
pleted and returned with the Affiliate Application.
Include any print advertising (rental brochures) from your com
petition.
Com
petitor One
Store Nam
e: _______________________________________ Address: __________________________________________ Phone: ________________________
Clarinet Base R
ent: ____________ M&R
Fee: ____________ Sales Tax: ____________ Total Monthly C
harge: ____________
Alto Sax Base Rent: ____________ M
&R Fee: ____________ Sales Tax: ____________ Total M
onthly Charge: ____________
Introductory Offer D
etails (Include total intro payment and breakdow
n of fees): _______________________________________________________________________
Num
ber of Months Applied to Purchase: _______ M
onths Applied to Exchanges: _______ Interest, Cost of Lease Services and/or O
ther Fees: _________________
Brands Offered: ________________________________________________________________________________________________________________________
Credit R
equirements (C
ircle all that apply): Driver License Social Security N
umber M
ajor Credit C
ard Checking Account O
wn H
ome U
tility Bill Credit R
eport
Repairs In-H
ouse? ____________ Turnaround Time on R
epairs? _____________ Loaners Provided? ____________ Road R
ep Visiting School? _____________
Is Replacem
ent Included? ______ If Yes, is there a deductible? ______ Qualifying Loss (C
ircle all that apply): Theft Loss Dam
age Beyond Repair
Notes and O
ther Info: ____________________________________________________________________________________________________________________
Com
petitor Two
Store Nam
e: _______________________________________ Address: __________________________________________ Phone: ________________________
Clarinet Base R
ent: ____________ M&R
Fee: ____________ Sales Tax: ____________ Total Monthly C
harge: ____________
Alto Sax Base Rent: ____________ M
&R Fee: ____________ Sales Tax: ____________ Total M
onthly Charge: ____________
Introductory Offer D
etails (Include total intro payment and breakdow
n of fees): _______________________________________________________________________
Num
ber of Months Applied to Purchase: _______ M
onths Applied to Exchanges: _______ Interest, Cost of Lease Services and/or O
ther Fees: _________________
Brands Offered: ________________________________________________________________________________________________________________________
Credit R
equirements (C
ircle all that apply): Driver License Social Security N
umber M
ajor Credit C
ard Checking Account O
wn H
ome U
tility Bill Credit R
eport
Repairs In-H
ouse? ____________ Turnaround Time on R
epairs? _____________ Loaners Provided? ____________ Road R
ep Visiting School? _____________
Is Replacem
ent Included? ______ If Yes, is there a deductible? ______ Qualifying Loss (C
ircle all that apply): Theft Loss Dam
age Beyond Repair
Notes and O
ther Info: ____________________________________________________________________________________________________________________
Veritas Instrument Rental Incorporated3670 131st Ave North • Clearwater FL 33762
Toll Free 877-727-2798 • Toll Free Fax [email protected] • www.veritas-online.com
