Franchising your existing business might be the best possible way to take the opportunity to enter emerging markets. Markets like India and China have complicated rules and regulations about who is entitled to own and operate a business there. The best way often to circumvent these rules is by franchising your operation in these markets.
By using franchising the franchisee owns the business whilst the franchisor takes a share of the profits. Why does an established business want to deal with headache of red tape and restrictive trade practices when with a leap of the imagination the franchise model allows them to achieve the same profitability without the same hassles?
Many British retailers including Argos and Mothercare have used the franchise model to dabble in new emerging markets. The franchise leaders that are quick to carve out major niches in these new emerging markets will grab unprecedented market share before their slow and sure footed competitors move in.
The largest emerging market place is China with India being a close second. China could become the largest market place in the world within the next ten years and overtake the USA.
Franchising is the ideal route for many US and UK companies who want to test the water without expending large sums of capital. This gives them a chance to dip their toes in the water without risking large sums of capital.
Once large organisations find that their business model does actually work in the new, exciting and dangerous market place they can dedicate their resources to find better ways to keep a higher percentage of long term profits for themselves.
China and India are very unique marketplaces. Unlike say for instance Australia not everybody in China speaks the same dialect. The divide between rich and poor is also vast. Tastes vary enormously as does buying power.
In India there are literally hundreds of different languages whilst admittedly the main bulk of buyers with money can be targeted by 2 languages… Hindi and English. Again here spending powers vary and so do belief systems.
In reality trying to expand new emerging marketplaces without testing the waters first is fraught with danger. Franchising offers a real solution to test out the marketplace, learn the structural issues and change your products and marketing so that it identifies with the local marketplace. This does not mean that you can not enter the marketplace independently. You can franchise x numbers of units and then create non franchised units in other territories.
Throughout history economic powers have grown and declined. Asia is growing rapidly and will play an ever increasing role in the ever demanding need for companies to find new customers. The buying power of Asian consumers is rising at a dramatic pace and the consumers are demanding better products and improving service. The opportunity is there now for Established US & Europe brands to market their brands and test the waters before entering fully.
To sum up, the emerging markets are predicted to compete with the western powers in terms of buying power and economic strength. Any company which ignores this is turning a blind eye and letting its competitors expand, gain a foothold and exploit the opportunity whilst they watch and wait.
Showing posts with label Celebrate Franchising. Show all posts
Showing posts with label Celebrate Franchising. Show all posts
Thursday, February 25, 2010
Monday, December 7, 2009
Education Franchise Opportunities In India
India is a land of contradictions and dichotomies and this extends to the area of education as well. We have the IITs and IIMs at one of the scale, and teacher-less schools at the other. After independence, India emphasized developing centers of higher learning. India also retained English as a medium of instruction; this has contributed greatly to its economic growth.
India’s youth, comprising over 50 percent of its population, is referred to as its demographic dividend. A rough statistics in the past year estimates the presence of 367 universities, 18,000 colleges, half-a-million teachers and about 11 million students on the rolls (Source- ibef.org). These figures have since escalated but they throw light on the large Indian education market & the opportunity therein but more importantly it also throws light on the gap between educated population & employable population. Statistics reveal that less than 25% of the graduates are actually employable. It is believed that based on the current and future manpower requirements of the various sectors, there is a huge demand-supply gap in the education space.
This has attracted many players to invest in education and training institutions with the aim of building valuable franchises that can be rapidly scaled up. The core job of these players is to make a candidate employable by training them in the right courses effectively inculcating the need to be abreast of the present & future requirement & acquiring newer & multilevel skills. Coaching classes, Vocational training, IT Training institutes, English speaking classes etc. are a few examples of such entities.
The latest news that India’s education sector is forecasted to increase its IT spending from an estimated $356 million in 2008 to $704 million by 2012, reflecting in a Compounded Annual Growth Rate (CAGR) of 19 percent during 2007-2012, according to the research study by Springboard Research, an IT Market Research industry (Source - Silicon India)
The spin-off benefits that this sector has created is that, along with ensuring quality education & making candidates employable, it has created several entrepreneurs countrywide & that explains the reason as to why franchising is so successful in the education sector.
This has also led to the growth & rise of entrepreneurs who have contributed significantly. Specially, Women Entrepreneurs who have an inherent quality of being very deft in building rapport & look at things from a human angle as well thus are very good in customer service. So, it is not surprising that women tend to launch businesses that are client based or service-oriented.
Source:Surjeet Singh Padma.
India’s youth, comprising over 50 percent of its population, is referred to as its demographic dividend. A rough statistics in the past year estimates the presence of 367 universities, 18,000 colleges, half-a-million teachers and about 11 million students on the rolls (Source- ibef.org). These figures have since escalated but they throw light on the large Indian education market & the opportunity therein but more importantly it also throws light on the gap between educated population & employable population. Statistics reveal that less than 25% of the graduates are actually employable. It is believed that based on the current and future manpower requirements of the various sectors, there is a huge demand-supply gap in the education space.
This has attracted many players to invest in education and training institutions with the aim of building valuable franchises that can be rapidly scaled up. The core job of these players is to make a candidate employable by training them in the right courses effectively inculcating the need to be abreast of the present & future requirement & acquiring newer & multilevel skills. Coaching classes, Vocational training, IT Training institutes, English speaking classes etc. are a few examples of such entities.
The latest news that India’s education sector is forecasted to increase its IT spending from an estimated $356 million in 2008 to $704 million by 2012, reflecting in a Compounded Annual Growth Rate (CAGR) of 19 percent during 2007-2012, according to the research study by Springboard Research, an IT Market Research industry (Source - Silicon India)
The spin-off benefits that this sector has created is that, along with ensuring quality education & making candidates employable, it has created several entrepreneurs countrywide & that explains the reason as to why franchising is so successful in the education sector.
This has also led to the growth & rise of entrepreneurs who have contributed significantly. Specially, Women Entrepreneurs who have an inherent quality of being very deft in building rapport & look at things from a human angle as well thus are very good in customer service. So, it is not surprising that women tend to launch businesses that are client based or service-oriented.
Source:Surjeet Singh Padma.
Saturday, August 30, 2008
Celebrate Franchising In India
FRANCHISE BONANZA-CELEBRATING FRANCHISING.
Celebrating Franchising could well be another festivity we get used to in the coming times. We will hear great success stories in franchising in the coming years, as this is the Beginning. After a fabulous year of growth, coupled with a never before year for Bollywood and the international acquisitions of Corus, Novelis, & Iconic Brands like Land Rover, Jaguar we are now shifting gears.
Any which ways franchising is erupting and I have not seen it better than this over the last decade. After unprecedented growth and the franchise business arrival in the Indian market, a real carnival season is unfolding itself. The MNC’S and new concept companies are factually standing up on their toes looking at INDIA as a highly potential target for their future franchise expansion.
In fact enough groundwork and spade works have been conducted, researched. Scaling of price, position, acceptance of products and issues of culture, ethical constraints are now being micro managed.
NOW IS THE TIME FOR EVERYONE TO GET INTO FRANCHISING and build a strong foundation for yourself whether you are seeking new businesses or franchisees or have a business that you want to grow through franchising.
As a matter of fact we interact daily with Entrepreneurial talents lining up to participate boldly seeking lucrative business offers. Consulting companies like ours have become more agile and have refined their deliveries. Event managing companies have mushroomed; advertising companies are doing more billings. The retail markets, real estate have met peek level output and is showing signs of future trends, still exhibiting more flamboyant growth potential. Mushrooming newer concepts in the retail business are the birth of expansive Malls in the country. Infact we receive at least two new enquiries everyday of people & companies trying to see if they could be ‘franchise their ideas’ from a situation a couple of years ago when most small and medium sized business did not even know what franchising was.
There is tremendous awareness that is being created and with franchise expo’s (I know of at least 10 expositions that will be held this year alone across the various cities of this country), there is bound to be a lot of new businesses springing up from different industries. With this scenario, the real franchise festive season has started, yester years this business model was still an unheard off subject, few would have discussed and have abandoned.
After all, gone are the days business community impulsively decided on putting their investments in an unfounded business, especially after hearing of franchise business model. They are more than convinced now that franchise business means: assured ROI, time tested and proven methodology at their disposal and consequential growth potential possibilities.
Introducing Franchise business in India has gathered enough material evidence so as to declare its success and apt business platform. Finding qualified prospective entrepreneurs, business buyers, educating them on the franchise business and convincing them to take up lucrative opportunities for a great challenge. Identifying the right challenge, people with business acumen and financial strengths, inspiring and motivating them to accept new business interests, changing their lifestyle and approach in doing business is all now becoming a practical reality. Today more than ever people are ready to accept change, they are hungry for information and what the next big idea is or how could I step into the next sunrise industry.
As a matter of fact, the business of franchise is not only a concept of expansion, but also a complete business system with regard to a successful brand, making it viable to its consumers and establishing brand equity & Image. Franchising essentially stands for creating wealth and also a well-grounded pathway to optimize resources. A lot of popular brands today own their credence to successful franchising worldwide and our country is going on a transition phase, disowning negative impressions of foreign business styles and looking at it in a more positive and forthcoming way.
Indian Brands require innovative approach. They are highly successful and have excellent product acceptance, by imbibing franchise route they can effectively stabilize and practice cost effective methodologies in expansion and wide area networking. If well structured and executed the franchise model can pay rich dividends. It is highly cost effective and will serve all ends.
In most developing economies franchising plays a very vital role in eliminating lackadaisical, under productive channels that is widespread in systems. Most Indian products and services will in future travel the franchise route and reach consumers in the best possible manner. What we need to understand in depth here is the totality of the market functions and how we could leverage franchising as a way of business to serve the consumer, the franchisee and the franchiser in addition.
All advanced civilization needs to have global perspectives. There cannot exist any kind of constraints and must do away with restrictions. It would be disastrous and catastrophic if enough thought and innovativeness do not come under our effort and certain degree of acceptance does not prevail.
Today we are not only accepting burgers and pizzas as a way of life in cities and towns, but the gyms and foreign movies have their own impact, hence it is only a question of adoptive attitude and not a question of any resultant impact or any other. Again we will have to adopt the best practices followed worldwide, adopt it to our own conditions and give what our consumers need fittingly.
Startling number of rich class people attribute their emergence into financial freedom to franchising because they perceived great innovative ideas beforehand and built up a franchise system that has made them different today. Great franchisees are those who followed franchiser model and never digressed what has been given to them by way of technology, and systems. They are implementers of systems designed by others.
The doubts and apprehensions people had about franchise business few years back have been diluted specially after the advent of some of the MNC’S and their success in the country is tracked. The system is rather fool proof, As a result Capital markets, banks and other lenders, leasing companies, landlords, the press and much of the public all are looking upon franchising.
Lot of focused study and research has gone into the conceptual stage of franchising and materialization of the business model. It is the legality and governing laws that will undergo changes now and then, so as to accommodate franchise business model, but it is important that these are not too stringent because you need free atmosphere to breathe and grow and if we have harsh legislations, it might just hurt the infants, or might suffocate the growing companies. It is still on a platform of legal scrutiny and of bench marking and protective measures that needs to be carefully incorporated. Having said that we believe that a complex system like franchising is already very well addressed by the existing laws of our country. In trying to compete the race of being a high economy and resourceful country India is now proactive. There exists enough proof and ensuing evidence that our country will thrive on franchise business and show receptiveness in the coming years.
Everybody else could just dive in, celebrate, enjoy and Profit From Franchising.
From The Desk Of Amit Nahar -A Franchise Consultant Based In Bangalore,India.
Founder & CEO of Sparkleminds Franchise Catalysts –A Franchise Consulting Company Specializing in Franchising Solutions for Companies Seeking Franchise Growth and Entrepreneurs seeking New Businesses.
You could reach him on amit@sparkleminds.com or on 080-41512345for comments on this article
Celebrating Franchising could well be another festivity we get used to in the coming times. We will hear great success stories in franchising in the coming years, as this is the Beginning. After a fabulous year of growth, coupled with a never before year for Bollywood and the international acquisitions of Corus, Novelis, & Iconic Brands like Land Rover, Jaguar we are now shifting gears.
Any which ways franchising is erupting and I have not seen it better than this over the last decade. After unprecedented growth and the franchise business arrival in the Indian market, a real carnival season is unfolding itself. The MNC’S and new concept companies are factually standing up on their toes looking at INDIA as a highly potential target for their future franchise expansion.
In fact enough groundwork and spade works have been conducted, researched. Scaling of price, position, acceptance of products and issues of culture, ethical constraints are now being micro managed.
NOW IS THE TIME FOR EVERYONE TO GET INTO FRANCHISING and build a strong foundation for yourself whether you are seeking new businesses or franchisees or have a business that you want to grow through franchising.
As a matter of fact we interact daily with Entrepreneurial talents lining up to participate boldly seeking lucrative business offers. Consulting companies like ours have become more agile and have refined their deliveries. Event managing companies have mushroomed; advertising companies are doing more billings. The retail markets, real estate have met peek level output and is showing signs of future trends, still exhibiting more flamboyant growth potential. Mushrooming newer concepts in the retail business are the birth of expansive Malls in the country. Infact we receive at least two new enquiries everyday of people & companies trying to see if they could be ‘franchise their ideas’ from a situation a couple of years ago when most small and medium sized business did not even know what franchising was.
There is tremendous awareness that is being created and with franchise expo’s (I know of at least 10 expositions that will be held this year alone across the various cities of this country), there is bound to be a lot of new businesses springing up from different industries. With this scenario, the real franchise festive season has started, yester years this business model was still an unheard off subject, few would have discussed and have abandoned.
After all, gone are the days business community impulsively decided on putting their investments in an unfounded business, especially after hearing of franchise business model. They are more than convinced now that franchise business means: assured ROI, time tested and proven methodology at their disposal and consequential growth potential possibilities.
Introducing Franchise business in India has gathered enough material evidence so as to declare its success and apt business platform. Finding qualified prospective entrepreneurs, business buyers, educating them on the franchise business and convincing them to take up lucrative opportunities for a great challenge. Identifying the right challenge, people with business acumen and financial strengths, inspiring and motivating them to accept new business interests, changing their lifestyle and approach in doing business is all now becoming a practical reality. Today more than ever people are ready to accept change, they are hungry for information and what the next big idea is or how could I step into the next sunrise industry.
As a matter of fact, the business of franchise is not only a concept of expansion, but also a complete business system with regard to a successful brand, making it viable to its consumers and establishing brand equity & Image. Franchising essentially stands for creating wealth and also a well-grounded pathway to optimize resources. A lot of popular brands today own their credence to successful franchising worldwide and our country is going on a transition phase, disowning negative impressions of foreign business styles and looking at it in a more positive and forthcoming way.
Indian Brands require innovative approach. They are highly successful and have excellent product acceptance, by imbibing franchise route they can effectively stabilize and practice cost effective methodologies in expansion and wide area networking. If well structured and executed the franchise model can pay rich dividends. It is highly cost effective and will serve all ends.
In most developing economies franchising plays a very vital role in eliminating lackadaisical, under productive channels that is widespread in systems. Most Indian products and services will in future travel the franchise route and reach consumers in the best possible manner. What we need to understand in depth here is the totality of the market functions and how we could leverage franchising as a way of business to serve the consumer, the franchisee and the franchiser in addition.
All advanced civilization needs to have global perspectives. There cannot exist any kind of constraints and must do away with restrictions. It would be disastrous and catastrophic if enough thought and innovativeness do not come under our effort and certain degree of acceptance does not prevail.
Today we are not only accepting burgers and pizzas as a way of life in cities and towns, but the gyms and foreign movies have their own impact, hence it is only a question of adoptive attitude and not a question of any resultant impact or any other. Again we will have to adopt the best practices followed worldwide, adopt it to our own conditions and give what our consumers need fittingly.
Startling number of rich class people attribute their emergence into financial freedom to franchising because they perceived great innovative ideas beforehand and built up a franchise system that has made them different today. Great franchisees are those who followed franchiser model and never digressed what has been given to them by way of technology, and systems. They are implementers of systems designed by others.
The doubts and apprehensions people had about franchise business few years back have been diluted specially after the advent of some of the MNC’S and their success in the country is tracked. The system is rather fool proof, As a result Capital markets, banks and other lenders, leasing companies, landlords, the press and much of the public all are looking upon franchising.
Lot of focused study and research has gone into the conceptual stage of franchising and materialization of the business model. It is the legality and governing laws that will undergo changes now and then, so as to accommodate franchise business model, but it is important that these are not too stringent because you need free atmosphere to breathe and grow and if we have harsh legislations, it might just hurt the infants, or might suffocate the growing companies. It is still on a platform of legal scrutiny and of bench marking and protective measures that needs to be carefully incorporated. Having said that we believe that a complex system like franchising is already very well addressed by the existing laws of our country. In trying to compete the race of being a high economy and resourceful country India is now proactive. There exists enough proof and ensuing evidence that our country will thrive on franchise business and show receptiveness in the coming years.
Everybody else could just dive in, celebrate, enjoy and Profit From Franchising.
From The Desk Of Amit Nahar -A Franchise Consultant Based In Bangalore,India.
Founder & CEO of Sparkleminds Franchise Catalysts –A Franchise Consulting Company Specializing in Franchising Solutions for Companies Seeking Franchise Growth and Entrepreneurs seeking New Businesses.
You could reach him on amit@sparkleminds.com or on 080-41512345for comments on this article
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