Content● Business Model

● Vision

● Growth Strategy

● Growth Strategy - Stores

● Growth Strategy - Shop-In-Shop

● Planned Development Chart

● Growth Strategy - Online

● ALDO Web Store

● Online Retailers

● Online Marketing

● Organizational Chart – Year 1

● Organizational Chart – Year 5

● Why Franchising?

● Franchise Structure

● Tensor and Shell

Vision Statement

● In cooperation with ALDO, Tensor intend to become a major player on the market for fashion shoes and accessories in Northern Germany and Scandinavia.

● We will reach this goal through organic growth by focusing on operational excellence, franchising, costumer needs and the exploitation of both Online and Offline opportunities.

Tensor Group, winter 2013

Business Model

● The Business model is based on a Master Franchise for Denmark, Sweden and Northern Germany.

● Operating under the Master Franchise Tensor will handle 2 strategic channels.

● Stores

Tensor will develop and administer the continued growth of ALDO stores.

● Online

Tensor will develop and administer online sales in the Nordic region.

Growth Strategy

● The Growth Strategy is primarily based on organic growth through development of both strategic channels, Stores and Online. However, funds are available for investments in strategic opportunities.

● Each Strategic Channel consists of multiple sales channels. Each channel will be exploited individually.

● When contemplating new stores as well as Shop-In-Shop and Online solutions Tensor will consider both the Turnover and the Brand Value of the placement.

Stores

Shop-In-ShopSub franchisees

Online

Online RetailersALDO Online Store

Tensor Group

Growth Strategy - Stores

● Initially Tensor will handle all existing stores directly.

● The goal will be to optimize, stabilize and streamline all stores.

● As soon as this goal has been obtained, growth will be secured through development of new stores.

● Within the first 5 years of the contract Tensor will commit to the development of 10 new stores.

● The stores will be placed in Malmo or in large provincial city’s in Denmark.

● When opening new locations both turnover and brand value of the placement will be taken into consideration.

● The new stores will initially be opened and handled by Tensor directly.

● In time some or all ALDO stores will, if profitable, be converted in to franchise stores. This will be done in cooperation with ALDO International.

Growth Strategy - Stores ● Within the first year of the contract Tensor will secure a new location for Købmagergade.

● Tensor sees the Købmagergade placement as crucial for the Brand Value of ALDO. This placement should be a Flagship Store.

● Further, Tensor will exploit opportunities in Shopping Centers. Tensor is well connected with major Shopping Center player Steen og Strøm.

● Stores should be placed in shopping centers that comply to 3 parameters

● High Costumer flow

● High end Shopping Center

● Geographically placed so that they will comply with logistical resources

● Examples hereof:

● Copenhagen Airport Shopping Center (Copenhagen, High brand value)

● Ro's Torv (Roskilde, medium to high brand value and volume)

● Rosengårdscentret (Odense, high volume)

● Bruun's Galleri (Århus, high brand value and volume)

● City 2 (Taastrup, High volume)

Growth Strategy - Shop-In-Shop

● Tensor sees the development of Shop-In-Shop solutions as a great generator of fast growth.

● Further, the Brand Value of certain placements is high.

● Finally, the resources required are limited as staffing etc. will not be handled by Tensor.

● Within the Shop-In-Shop channel we see 3 distinct channels, they are:

● High Street shoe and apparel shops (Chains). ● Main Street shoe and apparel shops (Chains).● High end Department Stores such as Magasin du Nord or Illums.

● Within the first 5 years of the contract, Tensor will aim to establish Shop-In-Shop solutions in Magasin du Nord in Aarhus, Rødovre, Odense and Lyngby. The Brand Value of Magasin is great and the resources required are limited.

● Further, Tensor will aim at securing contracts with both High and Main street shoe and apparel chains.

● Examples hereof are: In-Ware, Matinique, Vero Moda, Ginsborg, New England, Kaufmann Tøj Eksperten, etc.

● Total Shop-In-Shop solutions for the first 5 year period is estimated at 8.

Planned Growth Chart● First 15 years: 65 new stores and 32 Shop-In-Shops Solutions in DK, SE and North GE. Tot 97 units.

● Projected openings per year first 5 year period. (Growth is organic and based upon franchising.)

● Year 1: Total 1 shop - Replacement of Købmagergade.

● Year 2: Total 3 shops - 1 ALDO store DK, 2 Shop-In-Shops.

● Year 3: Total 5 shops - 1 ALDO store DK, 2 ALDO stores SE, 2 Shop-In-Shops.

● Year 4: Total 4 shops - 1 ALDO store DK, 1 ALDO store SE, 2 Shop-In-Shops.

● Year 5: Total 6 shops - 1 ALDO store DK, 1 ALDO store SE, 2 ALDO stores GE, 2 Shop-In-Shops.

Y-1 Y-2 Y-3 Y-4 Y-5 Y-6 Y-7 Y-8 Y-9 Y-10 …... Y-15

Denmark 8 9 10 11 12 13 14 15 15 15 …... 15

Sweden 1 1 3 4 5 6 7 8 9 10 …... 20

Germany 1 1 1 1 3 5 7 9 11 13 …... 30

Total stores 10 11 14 15 20 24 28 32 35 38 …... 65

New stores 0 1 3 2 4 4 4 4 3 3 …... 65

New S-In-S 0 2 2 2 2 2 2 2 2 2 …... 65

Tot. S-In-S 1 3 5 7 9 11 13 15 17 19 …... 32

Tot. New 0 3 5 4 6 6 6 6 5 5 …... 97

Growth Strategy - Online

● Tensor sees a great potential for ALDO shoes online. As of today ALDO shoes are not available online anywhere in the Nordic region.

● Online sales in Denmark are among the highest in Europe. In 2012 online sales experienced a growth of 19%.

● Apparel and shoes make up for 16% of all internet sales in Denmark.

● Within the first year of the contract Tensor will start the development of the online channel.

● The online channel consists of 2 distinct opportunities:

● ALDOs own Web Store

● Online Retailers.

Growth Strategy - ALDO Web Store

● The primary target market will be Denmark.● As soon as operations, logistics and resources allow it, Sweden will follow.● If possible the existing online shop solution for the North American and UK

market should be converted into a danish version. ● The setup for handling and shipping will be the responsibility of Tensor. ● A dedicated online specialist will be appointed to handle all online operations

including, SEO, SEM, Social, Web store as well as sales to Online Retailers.● Online sales should be up and running by the end of the second year of the

contract.

Growth Strategy - Online Retailers

● Development of sales through Online Retailers is crucial to online success

● Online Retailers are among the most used e-commerce sites in Denmark.

● As of today ALDO shoes are not represented in any online retail store.

● Tensor sees a great potential in sales through online retailers.

● Within the first year of the contract Tensor should initiate negotiations with some of the largest online retailers in the Nordic Region.

● Examples hereof are: Nelly, Smartgirl, Smartguy, Boozt, Miinto etc..

Online Marketing

● Online Marketing will be crucial to the success of the Online Business

● A strategy for online marketing should be devised as soon as possible.

● Focus should be on SEO, SEM and Social. Use of an online SEO, SEM agency may be necessary.

● The person hired to handle the online business should have a high level of expertise in regards to SEO, SEM, Social and Google tools.

● Further to this, strategic online advertising should be considered.

● Co-promotions with online retailers should be considered and may be necessary.

Organizational Chart Year 1

● Tensor aims to create a highly flexible and scalable organization

Nikolaj TrierFinance / Estate

Jonas KarlbergOperations / HR

Thomas BakPurchasing

NN.Online

Rødover Lyngby Købmager-gade Fields

MagasinFrederiks

bergFisketorvet

Nygade

Jonas KarlbergCEO

Web Store Online Retailers

Thomas BakBoard Chair

Organizational Chart Year 5

● As the scope becomes international Tensor will add an international department.

Nikolaj TrierFinance / Estate

Jonas KarlbergOperations / HR

NNPurchasing

NN.Online

NNShop In Shop

Rødover Lyngby Købmager-gade Fields

MagasinFrederiks

bergFisketorvet

Nygade

Jonas KarlbergCEO

Web Store Online Retailers

NNInternational

Scandinavia North Germany

New Shop New Shop

Why Franchising

● In the long run, Tensor views franchising as the way to move forward with the expansion in Scandinavia and Northern Germany.

● Why Franchising?● The franchising model has proven to be exceptionally strong I the

Scandinavian countries. ● Further, the financial model associated with franchising, allows for a

greater acceleration of growth, as it allows Tensor to free funds to invest in both strategic channels.

● Finally it reduces risk as less funds and liquidity will be tied up in stock. ● The growth that we want to obtain will not be possible without

franchising.

Franchise Structure.

● In order to make the franchise proposition attractive for future prospects, it is necessary to create an attractive sub franchise structure.

● In order to attract the best qualified prospects, target earnings per franchisee should be around 500.000 per year DKK

● Depending on earnings per unite, a single franchisee should manage between 1 and 3 stores so that he may reach the target earnings.

● To compare, target earnings for a 7-Eleven are 500.000 til 700.000 DKK per year.

● Initial fee or key fee should be determined ● Revenue share model should be determined.● In short, we need to find a simple yet effective model that suits all parties.

Tensor and Shell

● Due to a gas market in recession and a legislative change in opening hours for supermarkets in Denmark, that does not favor convenience, Tensor has made a strategic decision to exit the Gas and Convenience market

● As a consequence, and following satisfactory negotiations with Shell, Tensor will, as of February 2013, no longer be handling any of Shells gas stations or convenience stores in Denmark.

● This new situation allows Tensor to focus on growth and on entering into new business ventures.

● Tensor will be able to do so with freed resources and greater focus.

The future is what we start today...