AVON THE COMPANY

Established in 1978, AVON has become one of the largest privately owned and operated car, truck and van rental companies in Southern California. Mr. Nelson Silver the company's founder began the business as a neighborhood store at 18 years of age with the support help and guidance of his father, Mr. Maury Silver. AVON started with a vehicle fleet of 4 cars. The business grew exponentially through local resident's recommendations and referrals and AVON added Vans and Trucks to its fleet as needed. AVON has grown to a Company with over 50 employees, in three locations and currently has a fleet of over 800 cars, trucks and vans.

In addition to providing its core business model of renting cars, trucks and vans to the local community and mer- chants within the reach of each individual AVON location AVON has established Strategic Partners and Client relationships that now are serviced by AVON'S Corporate and Executive Transportation Division, Construction Contractors Division, Studio Transportation Division and Picture Car Division. AVON is also a Government approved vendor for California Municipalities and Institutions and is the "official" vehicle rental company of the Los Angels City Marathon. AVON is a full service transportation company and offers traditional passenger cars as well as a high end vehicle selection ranging from Range Rover and Mercedes to Cargo and Passenger Vans. AVON sets the bar higher with its standards and customer service. If it has 4 wheels......AVON probably rents it!!

AVON is a family owned business that has operated successfully for 33 years, employs over 50 people and currently has 3 locations in Southern California. AVON'S business model is unique and proprietary in the industry and has been the cornerstone of building the company's business in the local and suburban markets.

AVON is a local family business that is not dependent on air travel, vacations, and the typical "destination" traveler. AVON has established relationships with residents within the community as well as those businesses that have the need for rental vehicles and related moving products. AVON offers fast and friendly service, customer appreciation, a superior web site presence, a homey atmosphere for customers and........................... "AVON makes money"!

PRODUCTS, OPERATIONS & TECHNOLOGY

AVON'S services for its customers include the rental and leasing of passenger cars, which accounts for about thirty percent of its revenue, and the rental and leasing of trucks and other vehicles, which accounts for about sixty percent. AVON also offers a full product line of moving and packing materials such as boxes, packing supplies, dollies, hand trucks, and other products required for a move. In addition, AVON features other products such as GPS, baby car seats and other accessory related products. Operations are similar for car, truck, or specialty vehicle rental operations. Typical car rental operations have to acquire, maintain, clean, fuel, and repair cars, and dispose of older cars, and must operate a reservation system to acquire customers. Efficient operations are crucial for profitability, because the value of the rental asset is high. AVON offers a comprehensive support and training platform for all of the required skills necessary to manage and run a family business effectively.

BUSINESS ADVANTAGES

Inventory Management Important for Profitability - A small inventory of vehicles produces dissatisfied customers; a large inventory produces idle assets. AVON offers to each of its licensees a unique and different platform for the acquisition of its motor vehicles. In addition, AVON offers a training program that addresses the appropriate mix of vehicles depending on the geography of the location, the season and the demographic of the customer.

Reservation Systems Crucial to Get Travel Customers - High-volume car rental companies, such as at airport locations, depend especially on access to national reservation systems. Local market and truck rental companies depend less on reservation systems than high-volume rental companies because much of their business is from phone and internet inquiries.

Local Markets have Low Barriers to Entry - Generally, car and truck rental in local markets is a relatively simple business. To rent locally, companies don't need to invest in reservation systems or airport facilities.

Housing Market Influences Truck Rentals - The housing market is a driver of demand for rental of local and one-way trucks. These trucks are often used by consumers who are moving into new homes and apartments. Weekends are the times that trucks and vans are rented most.

BUSINESS TRENDS

Branding - National brands in the rental industry are associated with a particular type of customer. Hertz, Avis, and National, for example, are marketed as premium brands that provide special services to business travelers. Alamo, Budget, Dollar, and Thrifty market themselves to cost-conscious leisure and small business travelers. AVON is branded as the neighborhood family auto rental business that has extraordinary customer loyalty, brand recognition and has earned the trust, respect and loyalty from its repeat customers. AVON offers a training program in customer service and appreciation.

Fleet Management - Typically, car rental companies have high use during the week and low on weekends, high use in summer and low in winter. Companies need enough of an inventory of cars to supply customers, but the cost of carrying a large inventory is high. AVON offers guidance on the selection of an appropriate assortment of vehicles based on the season, geography and customer demographics.

Rapid Growth of Internet Rentals - An increasing number of customers make rental reservations over the Internet. The rapid growth of airplane bookings over the Internet, in particular, has increased Internet car rentals. Some airlines now sell the majority of their tickets online. To take advantage of this trend, many rental companies have invested in upgraded computer systems and altered their marketing strategy. AVON offers a "local reach and pay per click" platform as well as access to an on line analysis system that is so important in maximizing a companies effective web presence.

INDUSTRY OPPORTUNITIES

Corporate Fleet Management - The desire of many corporations to outsource transportation functions has presented opportunities for rental companies to provide logistics and maintenance services for corporate-owned fleets, or provide complete fleet management, including acquisition, ownership, and disposal of vehicles. AVON can help you maximize this opportunity in many channels of distribution such as studio transportation rentals and rentals to municipalities and corporations.

Additional Rental Equipment - In addition to renting cars or trucks, AVON also rents related equipment such as baby car seats, trailers, and moving and packing equipment. AVON also offers GPS systems for an additional fee.

Retail Sales of Used Vehicles - Rather than turn used vehicles over to wholesalers or car dealers for disposition, some rental companies maximize the residual value by selling them directly to their retail customers. AVON offers a number of programs for the liquidation of fleet vehicles to its licensees.

Offering Different Vehicles - Companies are marketing to customers who want to test drive new fun-to-drive cars or try out environmentally friendly ones. These offerings differentiate one rental company from another. AVON has an extensive line of vehicles from passenger cars to luxury cars, exotics, and hybrids. AVON also has a picture car division that provides specific cars to the movie studios from any year and in any color. We will work with our licensees to develop this marketing angle where it is possible to do so.

FINANCE

Acquiring cars and trucks, is the major financial cost for a rental company. Leasing is usually a more expensive option than out- right purchase, but requires less capital and is therefore an at- tractive alternative for small operations. AVON offers a unique and comprehensive support program for the acquisition and liq- uidation of vehicles whereby the licensee retains residual value in each vehicle within its fleet.

HUMAN RESOURCES

Most jobs in the industry require relatively low skills, and av- erage hourly industry wages are therefore moderately lower than the average US worker. Most jobs are clerical or involve car care, and many are part-time because of uneven customer traffic during the week, month and year.

Support & Training

AVON

• Financial Assistance Provided: No
• Site Selection Assistance: Yes
• Lease Negotiation Assistance: Yes
• Recruiting Assistance: Yes
• Co-Operative Advertising: Yes
• Training: AVON offers a complete and comprehensive Operational Support and Training Program to each of its licensees so as to assure them proficiency in the understanding of the skills required to run an AVON location.

  The AVON support and training programs includes but is not limited to:

  • Orientation Program at AVON'S West Hollywood Headquarters
  • On site Start-up Training at the licensees location
  • Management systems and Operational Training
  • Sales and Marketing Training
  • Community "reach" and advertising Training
  • Counter Automation systems Training
  • Reservation Bookings systems Training
  • Rate Management and services Training
  • Financial Management and Review Training
  • Customer Appreciation and communication Training
  • Employee development and Employee procedure Training
  • Fleet selection and product line assortment options
  • Acquisition and liquidation of vehicles
  • Maintenance and facilities management