The Franchising Market in India
Interview with Mr Amit Nahar, CEO of Sparkleminds, India.
How did you get started as a franchise consultant?
After my post graduation, I was contemplating of bringing in some international brands into India. We wanted to hire consulting organizations and realized a huge dearth of specific franchise consultancy services in the country, which is when we decided to get into this space, and today after 15 years, we are witnessing the growth that we anticipated then and are assisting clients in franchising their businesses across the globe from/to India.
What are the current trends on the franchising market in your country?
Franchising in India is primarily dominated by the food and education industry. Our portal franchisebazar.com lists over 30 different industries that are gaining popularity, while we believe that services will be the fastest growing segment over the next couple of years.
How many companies in your country offer franchises?
We have over 2500 companies listed as franchisors on franchisebazar.com and believe that there are over 1000 ready franchise companies in place, while the others are getting themselves organized.
Which are the best Franchises by growth, branch and demand?
Franchises like Subway (food), Titan (retail), Baskin Robbins (ice cream), Talwalkars (gyms), Eurokids (pre-school), Gitanjali (jewellery), cartridge world (services), Natural (Salon) NIIT (education), Remax (Real Estate), Motilal Oswal (Financial Services), are all in good demand and are growing tremendously. Our list of top 100 franchises in india at indiafranchiseblog.com for 2012 will tell it all for you.
What's the average startup investment in money and time for a franchise?
The average investments in India are in the range of 20,000 euros for retail businesses, 10,000 euros for service businesses and 15,000 euros for education and training franchises. The start up time for a franchise is generally 60-90 days from the day of sign up of the franchise agreement.
Which branches experience a lack of franchises?
The services segment is maturing and hence branches like commercial cleaning franchises & skill development franchises are growing. Midsize and Budget Hotels are hitherto not managed and franchised properly creating a dearth of proper franchises in that space.
Who are your clients?
We are a complete franchise consultancy offering end to end solutions to the franchise industry from franchise development strategy, entry strategy, franchise documentations, franchise marketing, franchisee recruitment, franchisee trainings and franchise audit. We are also a sort of international consultancy, that works with international clients and on their requirements of establishing their business in India. Our clients range from start-ups to fortune 500 companies, seeking franchise services.
What is the profile of the people who choose to buy a franchise?
People from all walks of life are embracing franchising in India. Women entrepreneurs who are generally interested in flexi timing businesses are taking up franchises, students graduating and wanting to get a first-hand experience on managing a business are buying franchises, professionals who want to get the best out of their experiences are choosing franchises that enable them make profits from their skill, senior citizens are choosing franchises that give them stability and at the same time keeps them engaged with a business that works according to a plan. Business persons are continuously looking at diversifications and areas they can venture into as traditional businesses are getting squeezed. Hence everybody today who wants to be his/her own boss is seeking a franchise business.
What should a franchisor know before coming to your country? Any specific requirements, legal restrictions, etc?
India is the easiest country to franchise an international business. While having said this it is equally complex to get to the right model for your business. Most international franchise agreements will not work for India. They have to be customized before which a detailed franchise entry strategy has to be in place. India has a complex tax structure and a consumption pattern and demographics that changes with every state and region. Doing your homework thoroughly before selecting franchises for India, would be a very prudent strategy to ensure that you lay the right foundation for your franchise in India.
