OLD MUTUAL

MASS AND

FOUNDATION

CLUSTER

Franchise

Distribution

Channel

PRESENTATION TITLE

CONFIDENTIALITY CLAUSE

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This presentation contains

confidential proprietary

information intended solely for the

information of the attendees of

this session. All information shared

during this presentation remains

Old Mutual's property and may

not, without Old Mutual's express

written consent, be used for the

attendees’ own benefit or gain

and may not be divulged to any

other party.

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MFC Franchise

PRESENTATION TITLE

TABLE OF CONTENTS

Introduction

Are you ready for an exciting journey

MFC Franchise Vision

The Concept

The benefits of partnering with Old Mutual

Target market definition

Our Product Offering

Support provided by Old Mutual

Marketing and Branding

Compliance

The Franchise Structure

Responsibilities of a Franchise Service Provider

The Profile of a Franchise Principal

FSP Remuneration Structure

FSP Value Proposition

The Profile of a Franchise Agent

FA Remuneration Structure

FA Value Proposition

Differences between AFD and MFC Franchise

Value Proposition Summary

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MFC Franchise

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WHY SHOULD I INVEST IN STARTING MY OWN MFC FRANCHISE?

What is a MFC Franchise?

A MFC franchise is a company that trades under the OM License and recruits, manages and supports suitable qualified people who can provide financial advice to customers in the Retail Mass market.

Why should a MFC franchise do this?

Old Mutual’s vision is to be the leading provider of primary financial services solution in South Africa by:■ Offering our clients access to value for money financial services advice,

products and ongoing service that meet their needs.■ We want to do this by running a cost-effective, highly productive and

sustainable business.

And that’s why we want to work with entrepreneurially minded individuals who have a passion for providing clients with good financial services advice!

We believe that by partnering with the right individuals we can add value to our clients’ lives by bridging the gap between their resources and their financial needs.

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MFC Franchise

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MFC FRANCHISE VISION

To facilitate economic

transformation through the

promotion of entrepreneurship

and broad-based access to the

financial services sector. To be

the employer of choice and

most profitable and sustainable

channel within the Old Mutual

Mass & Foundation cluster.

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MFC Franchise

PRESENTATION TITLE

THE CONCEPT

The Franchise business unit (MFC Franchise) is a sales distribution channel within

the Old Mutual (OM) Mass and Foundation Cluster (MFC).

MFC Franchise contracts to Franchise Service Providers (FSP) to sell a range of risk, retirement, and savings products under the OM license.

The FSP is managed by a Franchise Principal (FP) who may or may not have equity in the FSP (i.e. the FSP may be owned by a 3rd party).

The FSP recruits Franchise Agents (FA) who are trained and accredited to sell prescribed OM products. The FA contracts directly with and is paid by OM but

managed by the FP.

The FSP is responsible for meeting FA recruitment and sales targets, compliance,

practice management, finance and administration.

The MFC Franchise ‘Hub’ is an operational centre from which business

development managers and operations staff manage and support FSPs.

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MFC Franchise

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THE BENEFITS OF PARTNERING WITH MFC FRANCHISE

We understand that choosing between working for one of the big financial

services companies or braving it alone is an agonising risk vs. reward decision. Its

no secret that start-ups face many difficulties. Starting your own MFC franchise has

many benefits:

Entrepreneurial independence.

Operate under the Old Mutual Financial Services Provider license.

Being associated with South Africa’s most trusted financial services brand

Working with a company that has been providing customers with financial services for more that 160

years

Excellent financial returns linked to sales productivity, including:

Management fee structure

Earn % of agents’ commission

OM pays your Franchise Agents directly

Marketing support

Compliance support

Processes and systems support

Ongoing product training and support

Procedure and operations manual

A competitive product range than meets all our customers’ needs

Financial support for existing business looking to switch to Old Mutual MFC

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MFC Franchise

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TARGET MARKET DEFINITION

Private Sector Focus

2.8 million individuals (R6 000 – R19 500 monthly personal income earners)

Living Standards Measure (LSM)’s 6 to 8, aged 18-64

18 to 64 year olds age distribution:

18 – 24 (15% Young); 25 – 29 (15% Starters); 30-44 (36% Builders); 45-59 (22%

Pre-Retired); 60+ (12% Retired)

51% Female, 49% Male

Skewed towards private sector employment

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MFC Franchise

PRESENTATION TITLE

OUR PRODUCT OFFERING

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Product Product

SAVINGS RERERRALS

Retirement Plan IWyze

Education Plan OMF

Investment Plan

Single Premium Investment Plan

GREENLIGHT(Underwritten) Limited-Medically Underwritten

Comprehensive Disability Benefit Standard Funeral Plan

Accidental Disability/Death Benefit Value + Funeral Plan

Comprehensive Physical Impairment Benefit Accidental Death and Disability Plan

Greenlight Death Benefit Life and Disability Plan

Greenlight Accidental Death Benefit Pure Life Plan

Severe Illness Plus (Core) Benefit

Severe Illness (Core) Benefit

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MFC Franchise

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SUPPORT PROVIDED BY OLD MUTUAL

Access to world class products

Above the line marketing

Product training & accreditation

Brochures & sales tools

Fast, effective systems & process support

Procedure and operations manual

Onboarding of new FSP’s

Branding support

Old Mutual Financial Services Provider

licence

Compliance services

Assist in managing your business plan

Each Franchise has a dedicated regional

manager

Support recruitment and selection process

of franchise agents

Reporting

Management Reporting

Commission Related Reports10

MFC Franchise

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MARKETING AND BRANDING

BRANDING

Dual branding principle

FSP must adhere to the OM brand

guidelines

Annual brand audit

MARKETING

OM will provide marketing material

Above the line marketing support

(Advertising)

Franchisee can have their own

website – must be compliant with

OM branding requirements

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MFC Franchise

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COMPLIANCE

The compliance services will

be outsourced to Masthead

Masthead fees are payable

by Old Mutual

Monthly audits will be

conducted by Masthead

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MFC Franchise

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MFC FRANCHISE STRUCTURE

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Old Mutual MFC

FranchiseFranchise Service

Provider

Agreement

Franchise Agents

Franchise

Agent Mandate

Agreement

Franchise Services Provider

Franchise

Principal

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MFC Franchise

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FRANCHISE SERVICE PROVIDER INFORMATION

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MFC Franchise

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FRANCHISE SERVICE PROVIDER RESPONSIBILITIES

Develop annual business plans and achieve

the targets set in these annual plans

Recruit & supervise franchise agents

Ensure that the agents are computer literate

and can utilise a calculator (perform

calculations)

Provide acceptable working conditions

Office setup (IT and telecom hardware,

furniture, etc)

Marketing – website, business cards, etc

Promote Old Mutual brand

Satisfy ‘Fit & Proper’ requirements

Effective Practice Management

The FSP is responsible for its own company

secretarial, legal, tax and audit requirements.

Adhere to regulatory requirements (such as

occupational, health and safety)

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MFC Franchise

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PROFILE OF A FRANCHISE PRINCIPAL

So, could I become a successful Franchise Principal?

If you are someone who is interested in having your own company that

provides financial services…

Someone who has experience in the life insurance industry and that has a

good client base…

Someone who is entrepreneurial…

If you are someone who would be good at running a business…

And will be able to recruit and motivate a sales force

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MFC Franchise

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ENTRY CRITERIA OF A FRANCHISE PRINCIPAL

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Financial services industry sales experience

Experience in general management and

building business teams

Demonstrate ability to manage a

budget/financials

Demonstrate ability to recruit

Demonstrate ability to manage people

FAIS accredited and Fit & Proper

Must have relevant qualification (that

exempts the candidate from the FSB

qualification list) or 120 credits

Passed RE 5 exams

Honesty and integrity

FP must be able to supervise immediately

Passes credit checks

MFC Franchise

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FINANCIAL VALUE PROPOSITION

As with any business, profit is generated by maximizing revenue and keeping

expenses in check.

As a MFC franchise principal you will be in the business of

recruiting franchise agents and

motivating and supporting them to

find prospective customers,

provide good financial advice and

sell Old Mutual products that meet these customers’ financial needs.

Franchise agents receive commission for providing these services. As the

business purpose of the Franchise Service Provider (FSP) is to develop and

manage successful agents, the service fee Old Mutual will pay the FSP will be

related to commission the agent receives.

In addition, the agent and FSP may agree to a commission sharing

arrangement in exchange for the infrastructure and other support the FSP

provides the agent.

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MFC Franchise

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FRANCHISE AGENT INFORMATION

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MFC Franchise

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PROFILE OF A FRANCHISE AGENT

Matric

Computer literate

FAIS accredited and Fit &

Proper

Must have relevant

qualification or 30 FAIS

credits. Preferably 60 credits

to enable the Agent to sell

the full suite of products

Appropriate RE 5

qualification - RE must be

obtained based on date of

appointment in industry

No RE exempt candidates

will be considered

Honesty and integrity

Pass credit & criminal checks

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MFC Franchise

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FRANCHISE AGENT VALUE PROPOSITION

Remuneration Structure

Franchise Agent will be paid monthly directly by MFC Franchise.

Franchise Service Provider and Franchise Agent (FA) can sign an agreement

where a percentage of normal commission of the FA be paid to the Franchise

Service Provider in lieu of infrastructure and services made available by the

Franchise Service Provider

Percentage commission paid to Agent dependent on agreement between

Franchise Service Provider and FA

Franchise Service Provider provides the following –

Office space

Laptops and other sales tools (require laptops Greenlight)

Supervisory services

Management & advisory services

Surety

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MFC Franchise

PRESENTATION TITLE

VALUE PROPOSITION SUMMARY

■ Old Mutual MFC’s vision is to be the leading provider of primary financial services solution in South Africa. We believe that by working with entrepreneurially minded people who are passionate about financial services we can provide our customers with great value

■ If you are such a person we want to work with you and believe that our franchise offering provides you an ideal business opportunity:

The backing of South Africa most trusted financial services brand

Initial and ongoing training an support

Excellent service fee structure

Aligned to agent performance

Rewards for providing quality advice and service to customers

■ A compelling financial value proposition

A typical franchise should be able to generate over R1.5m in revenue p.a. (excl. bonuses) and over R500k in profits p.a. once its fully manned (illustrative projections)

Support for existing businesses looking to switch to Old Mutual

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MFC Franchise

PRESENTATION TITLE

INVEST IN THE RIGHT

PARTNER.

LET THE JOURNEY BEGIN

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MFC Franchise

THANK YOU

Old Mutual is a Licensed Financial Services Provider

THANK YOU

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