Proposal to Franchisee
Proposal to Franchisee
PART I OUR BUSINESS CONCEPT
AND OUR VISION
Our objective is to deliver and promote Traditional
Chinese Medicines in Canada and United States
of America through SANJIU's products and services.
Our vision and mandate is to deliver quality
and high performance Traditional Chinese and Natural
Medicine healthcare services and products to the
people of North America. Our mandate is to improve
the professional status of Traditional Chinese
Medicines and the practitioners
1.3 OUR COMMON GOAL
We unify our expertise and resources to disseminate
this ancient but effective healing knowledge and
service to every corner and every people of North
America, not only restricted to Chinese.
Our goal is to establish Sanjiu TCM Medical Center
is the most reputable and high performance TCM
clinic offering best healthcare service in North
America. Whenever they think of Chinese or Natural
Medicine, they choose Sanjiu Medical Center first.
1.4 HOW WE CAN ACHIEVE THIS GOAL IN GENERAL
We modernize Traditional Chinese medicine services
and products by high technology and modern management.
One of the key concepts is to enable the demonstration
of Traditional Chinese and Natural Medicine's
effectiveness in curing people through education
and consultation by professional practitioners.
SECTION II - WHO IS SANJIU
E-TECH INC: A HISTORY
2.1 WHO IS SANJIU?
Sanjiu Enterprise Group of China Consists of
52 related enterprises. The Sanjiu Enterprise
Group has its headquarters in Shenzhen, China,
just north of Hong Kong. The company is currently
the largest enterprises in China manufacturing
Chinese medicine, which are well received by patients
around the world. The technical and scientific
innovations of Sanjiu Pharmaceutical Company Limited
lead constantly to new achievements. Last year,
two innovations," Sanjiu Refined Single Chinese
Herbal extract tea" and Sanjiu Electronic
TCM Dispensing Machine", revolutionized Traditional
Chinese Medicine by the combination of modern
science and technology. The former innovation
develops single herbal teas that contain the efficacious
components extracted from the frequently used
Chinese herbs while the latter is an integrated
computerized management and dispensing system
that links the Chinese Medicine manufacturer,
the doctors, the patients and the dispensing stores
scattered in different places.
Today Sanjiu's products are sold throughout China
and other countries. With combined total and intangible
assets of 110 billion Yuan and 47.33 billion Yuan,
( US$13.75 billion and US$5.9 billion ) respectively,
as well as given its consistent revenue growth,
Sanjiu Enterprise Group is projected to become
a major global pharmaceutical company within the
Prof. Xinxian Zhao, chairman of the enterprise,
is the Vice-Chairman of the Chinese Pharmaceutical
Association. He has twice been elected as a representative
to the (8th and 9th) National People's Congress
in Beijing. Despite a heavy work schedule as head
of the Sanjiu Enterprise Group, Prof. Xinxian
remains active in the academic community as a
part-time professor at a number of universities,
including Tsinghua University, Zhongshan University,
Nankai University, Tongji University, and Sichuan
2.2 SANJIU COMPANY PROSPECTIVE
- Hardworking pioneering sprit
- Reforming and exploring development path
- High technology, high quality and high
- Leadership mechanism - Legal representative
- Decision mechanism - Democratic and intensive
scientific decision mechanism
- "4-cans" dynamic adjustment
- cadres can be promoted or demoted,
- workers can be employed or dismissed,
- salaries can be improved or reduced,
- organizations can be set up or canceled
- Legal supervision, inner supervision,
financial and auditing supervision, system supervision,
mass supervision and self-supervision.
Sanjiu's Development Strategy
- Life and health industrial, medical health
2.3 CHAIRMAN AND PRESIDENT OF SANJIU ENTERPRISE
Prof. Zhao Xinxian:
Prof. Zhao Xinxian is the Chairman of the Board
and President of the Sanjiu Enterprise Group.
Consisting of 52 related enterprises, the Sanjiu
Enterprise Group has its headquarters in Shenzhen,
China, just north of Hong Kong.
Prof. Zhao is the Vice Chairman of the Chinese
Pharmaceutical Association. He has twice been
elected as a representative to the (8th and 9th)
National People's Congress in Beijing.
Despite a heavy work schedule as head of the
Sanjiu Enterprise Group, Prof. Xinxian remains
active in the academic community as a part-time
professor at a number of universities, including
Tsinghua University, Zhongshan University, Nankai
University, Tongji University, and Sichuan University.
This gives him the opportunity to continuing teaching
while maintaining contact with students endeavoring
to pursue a career in the sciences.
Prof. Zhao earned his Bachelor's Degree in 1964
in Pharmacology from the Department of Pharmacology
at Shenyang Pharmaceutical College. After graduation
he began working for Nanfang Hospital's Medical
Bureau in Guangzhou. At the hospital he earned
successive promotions, working his way up from
Pharmacist and Chief Pharmacist to becoming Vice-Director
and eventually Director of the hospital's Medical
Bureau. While working at the hospital, Prof. Zhao
authored his first work, "Herbal Injections",
still considered a reference work in the field.
Beginning in the 1970's, Prof. Zhao conducted
extensive research on a Chinese fruit found useful
in the treatment of various chronic gastric disorders.
Based on his research, he received a loan of 5,000,000
yuan in 1985 to found the Nanfang Pharmaceutical
Factory within the Shenzhen Special Economic Zone,
north of Hong Kong, to bring this product as a
standardized extract to commercial production
levels. The Nanfang factory officially started
manufacturing and selling its first product, "Wei-Tai",
in 1987. The product proved to be an immediate
success as an effective remedy for many gastric
related disorders. In its first year of production,
the Nanfang Pharmaceutical Factory earned sufficient
revenues to be able to retire its loan. As more
products were developed, the company's reputation
In 1991, Prof. Zhao helped found the Sanjiu Enterprise
Group with the Nanfang manufacturing group, Sanjiu
Medical and Pharmaceutical Co., Ltd., becoming
its core enterprise. As additional enterprises
were included in the larger enterprise group,
the company began to become a prominent business
in China. By 1995, the government's State Economy
and Trade Commission and, the State Statistical
Bureau, rated the Sanjiu Enterprise Group among
the top 12 companies of some 20,000 large- and
medium-sized industrial companies in China. In
addition, Sanjiu Medical and Pharmaceutical Co.,
Ltd., research facilities were ranked among the
top 120 research facilities in the country.
Under Prof. Zhao's leadership, the enterprise group established a commitment
to substantiating the safety and effectiveness of its products. Scientists
and technicians are organized around pharmaceutical and natural products
research groups, studying potential products for their pharmaco-kinetics,
pharmacology, biochemistry, toxicology, and efficacy. Combined with a
sales and marketing force of over 2,500 employees, Sanjiu Medical and
Pharmaceutical Co., Ltd., surpassed Smith Kline in 1998, to become the
largest pharmaceutical company in China, a position it continues to maintain.
Today Sanjiu's products are sold throughout China and other Asian countries.
With combined total and intangible assets of 110 billion Yuan and 47.33
billion Yuan, respectively, and given its consistent revenue growth, Sanjiu
Enterprise Group is projected to become a major global pharmaceutical
company within the next decade.
2.4 SANJIU E-TECH INC.
Sanjiu E-Tech Inc. of Canada is a joint venture
company established by E-Tech Canada Limited and
Sanjiu Pharmaceutical Co. Ltd. Its goal is to
promote the Traditional Chinese Medicine by:
- Establishing the first organized and
well-planned TCM Medical and Research Center in
the world to strengthen the recognition of TCM
in North America. Through our training center's
courses and seminars, we impart accurate knowledge
and information to anyone who is interested in
TCM. We are fully committed ourselves to make
the Medical and Research Center a place of attraction
and to boost the popularity of TCM in North America.
Our objective is to promote the merge of Traditional
Chinese Medicine with the mainstream health care
system and be well accepted by everybody.
- Setting up a TCM Specialists Clinic,
with modern management and high-quality practitioners
in a clean, sanitary and professional environment.
Through concrete demonstrations, we provide high-quality
healthcare services in the most direct way, making
T.C.M. more appealing to North Americans.
- Setting up a research center for the
modernization of Traditional Chinese Medicine
while carrying out clinical research and study
of the effectiveness of herbs and herbal extract.
- Setting up a global "Network Clinic"
for patient gain access to T.C.M. doctors and
services in real time.
2.5 SANJIU T.C.M. MEDICAL AND TRAINING CENTER,
THE FLAGSHIP OF SANJIU E-TECH INC.
Products and Services
Sanjiu TCM Medical and Training Center is a comprehensive and multipurpose
center that provides Chinese and alternative medical services to people
of Canada and United State of America. This center is modern, comfortable
and spacious. It has more than 7,000 square feet operating space and accommodates
more than 20 practitioners. This center plays a very important part in
the modernization of Traditional Chinese Medicine. This is the first TCM
comprehensive clinical, research and resources center in the world. One
of its key concepts for its establishment is to enable the demonstration
of TCM's effectiveness in curing people through actual consultation with
All the practitioners in the center are well-qualified
doctors in TCM with many years of postgraduate
experiences. They devote wholeheartedly to educate
and share their expertise in Traditional Chinese
Medicinal healing methods with all people in North
Other than a medical clinic, the center also
organizes training classes and learning groups
for various types of Chinese healthcare techniques
such as Qi Gong, Tai Chi, Kung Fu, meditation
and other fascinating exercises.
Nothing is more valuable than good health. The
TCM Medical and Training Center combines today's
modern technology and the ancient natural healing
methods to serve humanity in North America. Our
overall vision is to enhance the health of the
2.6 ABOUT THE FOUNDER
OF SANJIU E-TECH INC.
E-Tech Canada was founded by Mr. Paul Li, a telecommunications
expert from Hong Kong, who immigrated to Canada
in 1993. In 1994, Mr. Li founded E-Tech Canada
with the goal of contributing his expertise and
experiences to his new community through the enhancement
He further envisions the deficiency of alternative healthcare opportunities
available to Canadians and implements Internet technology to enhance such
opportunities. In November 2000, with a joint venture with Sanjiu Pharmaceutical
Co. Ltd of China, E-Tech established a prominent reputation in providing
efficient and effective alternative healthcare opportunities. The global
community now has access to many valuable health information and resources
including tele-medicine without the constraints of time, culture or distance.
2.7 LITIGATION ACTIONS OR BANKRUPTCY HISTORY
Sanjiu Pharmaceutical Company, E-Tech Canada
Limited, and 999 E-Tech Inc. have no previous
litigation actions or any bankruptcy history.
PART III SUPPORT AND SERVICES
3.1 HOW YOU CAN BENEFIT
BEING OUR PARTNER/FRANCHISEE
You will be able to sell services and goods
that have instant name recognition and can obtain
training and ongoing support to help you succeed.
You will be given a format or system developed
by SANJIU, the right to use the SANJIU's name
for a limited time, and assistance from our staff
and administration. For example, we can help you
find a location for your outlet; provide you with
initial training and an operating manual, and
advise you on management, marketing, or human
resources strategies. We will also offer ongoing
support such as regional monthly newspaper or
newsletters, a toll free 1-800 telephone number
for referral of customers, and periodic workshops
3.2 SPECIFIC PRODUCTS AND SERVICES
1. The right to carry SANJIU's name and get the
instant name recognition of your medical center.
2. Continuous supply of full range Sanjiu branded
Single herbal extract tea (more than 380 types)
in factory prices offered exclusively to our franchisee.
3. Continuous supply of SANJIU branded name Chinese
Medicines and formula medicines (more than 100
types) in factory prices which only offer exclusively
to our franchisee.
4. Excellent support regarding our herbal extract
tea and Chinese medicines including technical
information, dispensing machine, storage, presentation
5. To use and excel a proven clinic management
system developed by SANJIU that includes computerized
patient management, prescription management and
6. To utilize the administrative procedures and
materials developed by SANJIU such as posters,
forms, licenses, certificates and etc.
7. The right to distribute the SANJIU's monthly
newspaper, "Family Health" in your franchisee
area and region. (in which you will be the exclusive
distributor of the region)
8. Initial and recurrent training, periodic workshops or seminars to enable
you to successfully handle the business.
9. Referral of customers.
10. Supply of professional practitioners or specialist
to support the operation of the clinic if it is
11. Promotional and marketing support.
3.3 THE DEMANDS OF THE
SERVICES AND PRODUCTS OF TRADITIONAL CHINESE MEDICINES
The demand for Traditional Chinese medicine in
North America is rapidly increasing. It is because:
- More and more people care more about
their health. They've started to acquire more
alternatives, other than relying only on Western
medicine and their family doctors
- It was found that there are many diseases
and discomforts, which have no good healing effect
in Western medicines, but have excellent effect
by acupuncture, massage and herbal medicines.
- The aged people are increasing quickly
worldwide. There are great demands in healthcare
service between 60-80s. of age.
- People realize that many western drugs
have side effect on human body.
- The Western medical expense is more and
- The Government and Insurance companies
pay less and are responsible less for the medical
Now, more and more people in North America begin
to know more about and trust Chinese and natural
medicines. They start to recognize the treatment
philosophy and learn its benefits with fewer side
effects. More people are eager to know more as
well as to use those medicines, foods, procedures,
exercise and treatment to make their body healthier
or to cure their sickness. Unfortunately, the
resource available to them are extremely limited.
In China, traditional Chinese and natural medicine
and treatment has more than 3000 years of history.
Now, many scientists and doctors around the world
proved that it has significance good result in
curing certain types of sickness. It is a safe,
effective method of correcting and prevention
of sickness and disease symptoms without conventional
pharmaceuticals and harsh chemicals with side
effects. However, in the past 100 years, the development
of Chinese and natural medicine was limited and
has not been fully explored and studied due to
the political situation of China. But now, China,
Taiwan, Hong Kong, Japan, and even many western
countries start to carry out schematic studies
and researches on traditional Chinese and natural
medicines and technique. Many drug and health-food
manufacturers in US and Europe are working on
a lot of researches making use of the herbs to
made medicine and health food in many areas especially
in prevention of sickness and disease.
Many Canadians and Americans especially not Chinese
want to acquire the service and products, they
do not know how and where to get an appropriate
clinic or medical centre.
Now and the coming 10 years, Chinese and Natural
Medicine is the new trend of heath-care and treatment.
We believe that a "fever" will happened
very soon and it can be predicted that Chinese
and natural medicine, treatment and technique
will play a very important role in Western medicine
world. Billion of people around the world require
this service and products- Traditional Chinese
Medicine in Canada and USA
Most important is that the demand is not seasonal
and it is an essential requirement. There is a
continuing demand for the products or services
in the future. The demand is permanent and the
service and product generate repeat business.
3.4 THE CUSTOMER BASE
At the moment, most TCM practitioners in North
America are focusing on Chinese residents. However,
the major strength of the customer base is local
Canadian or local American. Those people now begin
to understand and use Chinese medicines for many
diseases and discomforts. The customer base we
are looking at should not be restricted to Chinese
but should focusing on multicultural and mainstream.
If we successfully set up high performance clinics
using herbal extract tea as prescription, with
appropriate advertising and promotion, we are
easily expand the customer base within a very
3.5 RESTRICTIONS AND NEGATIVE SIDE OF TRADITIONAL CHINESE MEDICINE
At the moment, there are some restriction and
negative side of Traditional Chinese medicine
- Chinese Medicine lacks strict contrast
tests and objectively rigid norms to prove its
- Most Chinese Medicine does not have systematic,
pharmacologically and toxicologically experience
In this situation, the western community sometimes have doubts and disbelief
on Chinese medicine.
Another negative side is the Traditional Chinese
medicine does not wholly fitted into the insurance
claiming territory in North America.
We need some times to educate the people and
we believe that gradually, after they have understood
more about TCM, the negative side will disappear
Basically, In Chinese communities, Chinese medicines, acupuncture, massage,
and other natural treatment are very popular in North America. Clinics
and Medical Centres are located around the major cities in Canada and
United States of America. However, most of them are small scale and not
in a professional manners. The qualifications and the experiences of the
practitioners are not uniform and standardized. The profile and the "packaging"
of the Practitioners are low. Although a lot of patients want to acquire
the service and products, they do not know how and where to get an appropriate
clinic or medical centre.
The purposes of Sanjiu TCM Medical Centre is to
establish a reputation of leading clinics and
medical centres in Traditional Chinese Medicine.
So that any patient who thinking of Traditional
Chinese Medicine, will choose Sanjiu Medical Centre
Although there are TCM Clinics and medical centres
in most of the major cities in North America,
relatively most of them cannot scope with the
requirement of the patients. In the coming 10
years, we estimate that there are 35% grow annually
in the patient of Traditional Chinese medicine
in North America. The level of competition is
relatively extremely small especially if your
location is located in a little remote areas.
Our Sanjiu Medical Centres and clinics use single herbal extract teas
as prescription of Chinese Medicine formula. They are the most innovative,
revelatory and unique products in the market.
So far, there are no the similar kind of TCM Clinics
or Medical centre with wide name recognition in
North America. No other clinics and offer the
same products and services.
3.4 YOUR ABILITY TO OPERATE
If you are a TCM Practitioner, you are able to
master your patient and the herbal extract tea.
You have full control to maintain your patient
and customer base. We shall provide you all management
tools such as patient and herbal extract management
system, clinics management accounting systems,
training and etc. to help you and enable you to
start and maintain the effective business immediately
even you do not have any management and business
This business is a very dynamic and flexible.
It can be expanded quickly by simply employing
more practitioners and prolong the business hour.
Alternatively you can extract the business easily
if it is not satisfactory. You could even conduct
the business alone if you must lay off personnel
to cut costs.
If you are not a TCM Practitioner, we shall provide
you professional practitioners and provide all
necessary training to enable a successful business
3.5 NAME RECOGNITION
A primary reason for your partnership with us is the right to associate
with our great company's name. SANJIU is widely recognized worldwide and
has a world known registered trademark. It will draw customers who know
its products or services. If you stand in front of the TIME SQUARE in
New York City for 5 minutes, you would be able to see our trademark appearing
on the TIME SQUARE Billboard. Sanjiu have been in operation for more than
15 years and is a world class company. The company has a reputation for
providing topnotch products and services.
3.6 TRAINING AND SUPPORT SERVICES
Our partners will receive unparalleled support
and training from SANJIU and from 999 E-Tech Inc..
The support and training is not just the once,
but is continuous.
The training comes in many aspects,
1. Management training for operations and management
of the Medical Center.
2. Training of TCM Practitioners to acquire the
most updated information, technology and technique.
Usage of new instruments and treatment methods.
3. Computer training to fusing technology with
the clinic's operations.
4. Acquire new professional with the right academic
qualifications from China and other countries.
3.7 OUR EXPERIENCES
SANJIU has been in the healthcare business for
more than 15 years. It started from a small company
of 5 people to a world class company with annual
turnover of US$ and asset of US$ . We are experienced
in building successful businesses.
SANJIU is also experienced in operating franchise
businesses as we have more than 150 franchise
TCM stores in China. Our guidance, support, and
training are proved to be reliable and solid.
Our project is a fast growing franchise system
which increases the franchisor's name recognition
and will attract a lot of customers and patients
on your behalf. SANJIU is a well-established and
aggressive company with strong financial background,
asset and staff to your support.
3.9 THE RIGHT TO CARRY PRODUCTS
OTHER THAN THE PRODUCTS OF
Sanjiu TCM Medical Centres will concentrate theirs
sales on services and the products of Sanjiu.
However, with prior approval of Sanjiu, the franchisees
may be allowed to carry products related to healthcare
produced by other manufacturers.
PART IV TERMS AND CONDITIONS
4.1 FRANCHISEE'S INITIAL FRANCHISEE FEE AND OTHER
The initial franchise fee or Royalty payment
to begin the operation is CAD$3,000. To express
our gratitude to our most dedicated partners,
however, we will waive both payments for the first
thirty successful applicants.
4.2 FEES FOR TRAINING
The followings are other fees to be paid on the
1. Training fees:- $100 per day for the initial
setting up training (training sessions are limited
to one principal participant per franchisee only
and is mandatory)
2. A field trip to China is optional.
4.4 CONTINUING ROYALTY PAYMENTS
Franchisee will pay to the franchiser five percent
(5%) of the franchisee's gross sales for the products
and services that bear the name, or related to
"SANJIU", as well as one and a half
percent (1.5%) of the franchisee's gross sales
for the products other than those supplied or
related to "SANJIU".
4.6 FRANCHISEE'S PRINCIPAL OBLIGATIONS
4.61. The principle obligations of the Franchisees
1. Operate the Sanjiu Medical Center or Clinic
according to the Agreement
2. Use single herbal extract tea as the primary
prescription for the patient
3. Sell the Chinese herbal medicines and formula
produced by Sanjiu
4.62. OBLIGATIONS OF THE
FRANCHISER; SUPERVISION, ASSISTANCE; SERVICES
1. The franchiser SANJIU has obligations of
supplying the single herbal extract tea all the
time without interruption.
2. SANJIU as has obligations to provide training,
support in the management of the medical center
4.63. EXCLUSIVE AREA OR
1. SANJIU has identified numbers of clinics or
medical center is a area or territory. The maps
of the area and territory are shown in enclosure
2. The area or territory is exclusively for a
particular franchisee. Sanjiu will not open or
allow any operators to open another Center or
clinic without the agreement of that franchisee.
4.64. PATENTS AND COPYRIGHTS
The Franchisee will conduct its business under
the name "SANJIU E-TECH INC." promptly
upon the execution of agreement. Promptly upon
the expiration of the agreement, franchisee will
revoke or terminate such assumed name registration.
If franchisee will fail to do so, SANJIU E-TECH
INC. will act on its behalf.
on the franchisee's part to personally participate
in the operation of the franchise business
4.66. RENEWAL, TERMINATION,
TRANSFER AND DISPUTE RESOLUTION
Franchisee may choose, but not obliged, to enter
into a new franchisee agreement in the form then
being offered after the expiration of the 5-year
term of the current agreement. Please refer to
Section 3.3 of the Agreement for details regarding
the form and manner of renewal.
4.67. COMMITMENT OF A
FRANCHISEE TO PURCHASE OR LEASE FROM A DESIGNATED
1. There is no commitment of a franchisee to
lease of the office or medical center from designated
2. There is a commitment of a franchisee to use
exclusively Sanjiu Single Herbal Extract Tea for
the prescription of the patient. No physical herbs
or other brand named herbal tea is allowed excepted
written approval from Sanjiu is
4.68. EVALUATION OF PERFORMANCE AND GUARANTEE
OF SUCCESS IN YOUR BUSINESS
We shall assist the operator in starting the
business and help maintain its success. The franchisee
will be advised to follow the procedures of the
handbook to operate the business. As well, monthly
visit by the franchiser will be of great benefits
to the franchisee in providing counsel and broad
directions. However, the success of a medical
centre does rely on diligence on the franchisee's
part to which it is beyond SANJIU's jurisdiction
4.69. OTHER COSTS
Our objective is to deliver Traditional Chinese
Medicine to the world and to expand this opportunity
to the TCM practitioners as well as operators
who have the same vision and interest. We are
prepared to waive most of the royalty payment
(fee) for the first 100 operators and reduce part
of the franchisee fee for the first year. This
will greatly reduce the risk on the operator's
part. All applicable fees are as follows, please
refer to Agreement for terms and detailed calculations.
- Continuing royalty payments
- Advertising payments, both to local and
national advertising funds.
- Grand opening or other initial business
- Business or operating licenses.
- Product or service supply costs.
- Real estate and leasehold improvements.
- Discretionary equipment such as a computer
system or business alarm system.
- Legal fees.
- Financial and accounting advice.
- Compliance with local ordinances, such
as zoning, waste removal, and fire and other safety
- Health insurance.