Advantages of Investing in Franchise in India
Are you looking to invest in profitable franchise in india? If yes, then wait no more this blog will help you!
The Franchise business is playing one of the crucial roles by expanding the international and local brands in India.
Well, this has contributed to economic development as well as in job creation too.
As per the recent statistics, The Indian franchise and grocery franchise in India has recorded an impressive growth rate of 35-45% annually and is expected to reach at a rate of ₹7.16 lakh crores by the end year of 2024.
Moreover, the franchise business has also emerged as one of the most lucrative business opportunities in India all due to its dynamic market which is offering aspiring entrepreneurs the chance to partner up with the established brands.
With almost 2 lakh franchise outlets, India is now the second largest Franchise in India market after the United States.
Today, India has become a global hotspot for the Franchise in India opportunities in every sector especially in grocery franchise in India which is attracting both experienced as well as the new entrepreneurs.
Whether its retail giants, popular food chains or specialized services, the franchise business does promise a fast track to success with a ready-made customer base and built-in brand recognition.
However, like any business, the Franchise in India models do come with a set of its own challenges.
While, the benefits of franchise businesses can seem overwhelmingly positive as it offers low risk, operational support, and access to the expertise.
In this article, we will dive deep into both the sides of the coin of a franchise business and will help you to determine whether a franchise business in India or even a grocery franchise In India is a right move for your entrepreneurial ambitions.
Also read: How To Choose The Right Grocery Mart Franchise
What is a Franchise Business Model in India?
The franchise business model allows companies, also known from the term (franchisors) to expand their business by giving other individuals, also known from the term (franchisees), the right to use up their operational model, brand, and product in exchange of some amount of profit sharing, a fee, or even ongoing royalties.
The franchise model has been embraced by many international as well as by Indian brands as it enables individuals to enter the business world as well as it helps in the economic growth across various industries.
Role in Economic Growth
Franchise in India contribute to the Indian economy by creating new jobs, expanding market presence, and increasing consumer access to trusted brands.
It’s one of the most effective ways for businesses to scale their operations across regions while keeping capital expenditures relatively low.
Why Franchising is Thriving in India
India’s young population, growing middle class, and increasing disposable incomes have fueled the growth of franchise businesses.
Franchising allows businesses to expand into new markets quickly, and for investors, it offers a proven business model with reduced risk.
Advantages of Franchise in India Business
1. A Well-Established Brand
One of the most significant advantages of owning up a supermarket franchise is it’s established brand name.
The franchise owners get to benefit from the recognition and brand reputation of the parent company which allows them to attract customers and helps in creating brand loyalty too.
Moreover, customers are more likely to trust a well-known brand which makes it easier for the franchise owners to build up a loyal customer base.
2. Proven Business Model
Another well noted benefit of owning a supermarket franchise in India is its business model which been proven that it does work!
The franchise owners benefit from the parent company’s years of experience and further they expertise which reduces the risk of failure.
It is seen that they do receive comprehensive training, guidance, and support as well. A franchisee can also receive comprehensive training, support as well as guidance which will help them to get succeed.
3. Access To the Resources
One major advantage of being with a franchise is that the franchise owners will have the access to the resources which most of the independent owners lacks to have!
Well, this particularly includes access to the marketing materials, bulk purchasing as well as to the technological resources too.
Further, this helps in reducing up the costs of the franchise owners which helps in increasing up the profits as well.
4. Increased Support
Franchise owners receive ongoing support from the parent company, including training, marketing, and operational support.
This enables franchise owners to stay current with industry trends and run their businesses more efficiently.
5. Consistent Brand Identity
One of the most significant benefits of owning a supermarket franchise in india is the consistent brand identity.
Franchise owners must follow the parent company’s guidelines, which ensure that all franchises have a consistent look and feel.
This consistency helps customers recognise the brand, which increases customer loyalty and drives sales.
6. Training and Technical Know-How
The franchisors offer comprehensive training which ensures that you are equipped with the right knowledge and the skills to run up the business successfully.
This also makes the franchisees to manage up their day-to-day operations if they lack previous experience in the industry.
7. Rapid Expansion
The franchising allows the brands to expand up their footprint quickly without making significant capital investment by them.
The franchisees fund up their own outlets which allows the franchisor to scale rapidly while entering the new markets.
8. Lower Operating Costs
The franchise in india benefits from the collective purchasing power which leads to the lower costs for services, goods, and marketing.
This further helps the franchisees to run up their operations more profitability and efficiently.
9. Less Risk for Franchisee
Unlike other business, franchisees benefit from a well established brand and proven business model too which reduces the risks that are associated with the new ventures and makes franchising one of the most attractive option for the entrepreneurs.
10. Branding and Marketing Support
Franchisors invest heavily in brand building and marketing, providing franchisees with a steady stream of customers.
Franchisees don’t need to worry about creating brand awareness or running national advertising campaigns, as the franchisor handles these tasks.
11. Easier Access to Capital
Banks and financial institutions are more willing to provide loans to franchisees of established brands because the business model has already been proven.
This makes it easier for entrepreneurs to secure funding for their franchise.
Disadvantages of Franchise Business
1. High Initial Investment
While some franchise in India are affordable, many require a significant upfront investment.
This includes franchise fees, setup costs, and ongoing royalty payments, which can deter potential franchisees who lack sufficient capital.
2. Strict Operational Guidelines
Franchisees are required to follow the franchisor’s operating guidelines, which can limit their ability to make independent decisions. While this ensures consistency, it can sometimes stifle creativity and innovation.
3. Profit Sharing with Parent Company
Franchisees must share a portion of their profits with the franchisor in the form of royalty payments.
This can reduce the overall profitability of the business compared to independent ownership.
4. Limited Exit Strategy
Franchise agreements are typically long-term and can make it difficult for franchisees to exit the business without incurring penalties or complications.
Selling a franchise can also be more challenging compared to selling an independent business.
5. Greater Control by Parent Company
Franchisors often exercise significant control over franchisees’ operations, including marketing strategies, product offerings, and even pricing.
This limits the franchisee’s autonomy and ability to make decisions that may be more beneficial for their specific location.
Top Franchises in India
India has become as one of the major hubs for Franchise in India opportunities which offers diverse range of businesses which is expanding across the country through this model.
Moreover, franchising does offer the entrepreneurs a chance to start up their business with support of well-established brand.
It also ensures a smoother path to success as well. Below are some of the top franchise in India across different sectors.
1. Lenskart
Industry: Eyewear
Investment Required: ₹30-35 Lakhs
Lenskart is one of the most well-known and the finest and fastest growing eyewear brand. The brand offers a wide range of eyeglasses, optical lenses, and sunglasses too.
With its presence in both online and offline market, lenskart has revolutionized the eyewear industry In India by making vision correction affordable, stylish yet accessible to every customer.
2. DTDC Courier and Cargo Ltd.
Industry: Courier & Logistics
Investment Required: ₹50,000 to ₹2 Lakhs
DTDC is one of the oldest, well-trusted and leading courier service providers in India which is offering robust franchise network of over 5800 channel partners.
As, DTDC courier and Cargo Ltd, was the first courier company to adopt the franchise model, it offers delivery services in both Local as well as international channels which continues to grow rapidly.
3. Domino’s Pizza
Industry: Food & Beverage (Pizza)
Investment Required: ₹30 Lakhs
Domino’s is one of the most recognized pizza brand in India which has more than 500 outlets in the world.
The brand is owned by the foodworks limited and it continues to dominate the pizza delivery market with its convenient delivery model and with popular product offerings too.
4. Patanjali
Industry: FMCG (Fast-Moving Consumer Goods)
Investment Required: ₹7 Lakhs
The brand was founded by the Baba Ramdev and today it has become as one of the major household names in the field of herbal and ayurvedic. The brand has successfully expanded into categories like personal care, food items and healthcare products too which makes it one of the most sought franchises.
5. Subway
Industry: Food & Beverage (Fast Food)
Investment Required: ₹25 Lakhs
The brand subway is one of the world’s largest fast-food chains which is specializing in the market of sandwiches.
The brand started its operations in the year 2001 and has made over 650+ outlets across 70 cities by now.
The healthy options, simplicity has established this brand and made it as one of the top franchise opportunities in the country.
6. Bikanervala
Industry: Food & Beverage (Sweets & Snacks)
Investment Required: ₹30-40 Lakhs
The bikanervala is one of the well-established name in the market of sweets and snacks in India.
The brand is situated over 85 locations in India and about 26 in abroad which is well known to provide high flavour and quality products.
The brand promised to provide options with guaranteed demand for its products as well.
7. Amul
Industry: Dairy & FMCG
Investment Required: ₹2-5 Lakhs
Amul is a well trusted name and also comes under as a grocery franchise India sector and is also known to be one of the most affordable brands too.
The franchise offers the chance to all people to sell their popular dairy products such as milk, cheese, butter and more in affordable rates.
With a brand which has loyal customer base and good brand presence, it is a low risk and high reward investment too.
8. FirstCry
Industry: Baby & Kids Products
Investment Required: ₹20-30 Lakhs
The firstcry is one of the most leading brands in the sector of baby and kid products and also it offers everything related to clothing and toys.
Today, the brand has a massive range of products and it also has an established brand presence too.
The first cry is definitely one of the top franchise choice for the entrepreneurs who are looking to enter into the sector of kids market.
9. Lakmé Salon
Industry: Beauty & Wellness
Investment Required: ₹50 Lakhs
The Lakme salon is a well-known and a trusted brand in the sector of beauty and personal care.
As, the India is growing in the professional grooming services, today, the brand is also offering the access to its renowned beauty products, training and in the marketing support too.
The brand’s reputation makes it a profitable franchise option in the beauty sector.
10. KFC
Industry: Food & Beverage (Fast Food)
Investment Required: ₹1.5-2 Crores
KFC is a well known brand because of its fried chicken and is one of the popular fast-food chain too which has over 450 outlets in India.
A KFC franchise in India is a globally recognized brand which has a well-established customer base.
Although, the initial investment is high and the returns are significant all due to its popularity and business model.
Check out this: Online Grocery Shopping: Is It Worth It?
Conclusion
The franchising does offer a promising opportunity for the entrepreneurs who are looking to enter the India’s grooming market.
The model also offers secured benefits and makes it quite an attractive option to enter the business world.
However, it is important to take weight the benefits and disadvantages before committing as it can require a significant financial commitment and it does has its own set of challenges too.
