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As per different reports and studies by national and international organizations, Franchise Opportunities are growing rapidly in India.
As per those reports, there were more than 6000 franchisors and close to 2.5 lakhs of franchisees around 2021, and the number has been growing very quickly.
Franchise business refers to a business model where multiple people take part ownership of an already well-known business or brand, generate revenue for the main business, and get a share of the same revenue. For example, KFC has multiple outlets, and these are franchises.
So, there is one KFC where people purchase franchise rights from the company to use the company’s name, brand value, and services and products to generate business for KFC and get a portion of the revenue as their share.
Here the brand owner is the franchisor, who sells the franchise right, and the person buying the same and selling the products and services of the business for a share of revenue is the franchisee.
You must be wondering what a franchise business is, and if you know what it is, you want to know how it works and how you can start it.
So, here in this article, we will guide you on how a franchise business works, how you can start one and the requirements, how much you can earn, and other different factors you need to know before diving into the franchise world.
If you are wondering how Franchise Business in India works, then it is quite simple.
Suppose there is a popular business entity that everyone is aware of and wants to expand their business in different parts of the country.
They offer franchise opportunities to people who want to invest and buy the franchise right.
Once you buy the franchise right, you can sell the products and services offered by the main business. They will also offer you support and training for selling their business products and services.
Now, once you start generating revenue for the business house, they will share a percentage of your revenue with you. So, this way, both the business entity and your business grow.
However, there are different models for Franchises in India, and accordingly, they work. These are discussed in the next section of the article.
There are two different models for India’s Franchise Business –
When a franchisee opens one single franchise, it is the single-unit franchise model. There can be other franchises of the same business in the same city or town that compete with each other.
Suppose the franchisee has complete control over an area or city and is the only franchise of a particular business selling all the products and services across the area or a region.
In that case, it is known as the Master franchise business model. Here, there is no other competition for the franchisee in that region.
Apart from these, there are 2 more models that provide more options in this business.
A FOFO Model is also known as a Franchise owned & Franchise operated model, where the franchisee owns the business & also the franchisee runs it.
The Franchisor here only provides outside support to the Franchise Owner. The Franchisee itself runs all operations. In this model, the Franchisee keeps most of the Revenue Share.
A FOCO Model is also known as a Franchise owned & Company operated model where the business is owned & invested by the franchisee, but the franchisor or the Brand runs it.
Here the Franchisor takes care of all operations of the business along with marketing & other necessary works required to grow the franchise business.
The franchisee only invests and takes some part of the revenue sharing. Here, the majority of the Revenue is kept by the Franchisor.
The franchise business has witnessed around 30% to 35% growth in the past five years.
As per the number of franchisors, and franchisees, India comes second in franchise business opportunities after the USA.
Around 1.8% of the GDP comes from franchise business while the figure is estimated to grow to 4% in 2022. The reason behind this huge growth is as follows –
To find the right and Latest Franchise Opportunities in India, you have to –
FranchiseByte is your one stop solution for any type of information on Franchise Business Opportunity in India.
You can find details about Top Franchise Brands & also you will find details related to Franchise Fraud & Business Ideas.
Here, we try to help you get knowledge about franchise business & its advantages & disadvantages. We also guide you related to innovative business ideas which may help you growing your business.
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Let us now see which all franchise businesses can be profitable in India –
Let’s have a detailed understanding of these franchise businesses below –
To start with, we have Jawed Habib Hair and Beauty Ltd. franchise. As most of you know, this is a chain of salons providing multiple beauty and hair care services.
Jawed Habib is known for hairstyling treatment. In India, there is no hair stylist as popular or sought after as jawed Habib.
It was founded in 2000 and currently has around 900 franchises across the country. It will cost you around Rs. 20 lakhs to Rs. 30 lakhs to purchase the franchise rights and set up the salon.
Jawed Habib just changed the way people look at barbers. He changed the profession into one of the most professional and glamorous ones.
Courier service and DTDC are like two sides of the same coin. This company has created such goodwill in the market that whenever people think of courier services, at least this name once strikes most people’s heads.
DTDC has been in the market for decades and has thousands of franchises nationwide.
The best part of owning this franchise is that the cost and investment requirement is within Rs. 50000 to Rs. 2 lakhs.
Can you imagine having the franchise of DTDC at such a low cost? Subhashish Chakraborty founded this business entity, and presently he is the Chairperson and MD of the firm.
In the courier and express industry, DTDC has made its mark, especially with the franchise business model.
If you want to start a business in the retail fashion segment, then FabIndia can be a great choice. FabIndia is known for its ethnic collection for both men and women.
You can offer a great variety of clothing to the customers. The primary attraction is the quality of the material provided by this brand, and it is one of a kind.
Though the investment requirement is a bit higher for this franchise of FabIndia however you can also expect a great deal of profit.
The investment requirement would be around Rs. 40 lakhs and above. There is more than 175 franchise of FabIndia across the country.
It was started in 1960 by John Bissell, and now it is a brand that is liked by both the younger generation and elderly people.
Pre-schooling in India is becoming increasingly famous. Eurokids is a name that has been reckoned with pre-schooling for a few years.
This is one of the most trusted pre-schools in the country and has thousands of franchises. It started back in 2001 by Prajodh Rajan and Vikas Phadnis.
Their child-first ideology created a different meaning for pre-schooling, where kids are not taught bookish things much. Rather, they are familiar with spending time without their parents, away from home, making friends, playing, interacting with other kids, and other such activities.
You can buy the franchise of Eurokids for a price of Rs. 10 lakhs to Rs. 20 lakhs which also includes the setting up cost for the school.
If you want to get into the FMCG sector and have decent capital that you can invest, then Subway can be one of the best options.
The total investment would be around Rs. 50 lakhs to Rs. 90 lakhs depending on the space you buy or rent, staff, and related parameters.
However, this is the most profitable franchise business model in India.
There are more than five hundred franchises of Subway in India, but it still falls short of catering to its product demand. It is a foreign brand started in 1965 by Fred DeLucea.
Patanjali brought a wave of using organic and herbal products to the market. While there were many such products before, the magic of Baba Ramdev made Patanjali stand out from the rest.
If you plan to open a mega store and have a minimum of Rs. 1 crore to invest, you can buy the franchise of Patanjali.
You would also need a minimum area of 2000 square feet for opening the Patanjali Mega Store. To start the process, you also have to pay a security deposit of Rs. 5 lakhs, which is fully refundable.
The initial investment requirement is around Rs. 1 crore, and you can further expand and make more investments.
In the eyewear and optical industry, Lenskart has brought a revolution. It has come up with numerous designs to make your glasses attractive.
This business already has thousands of franchises/branches across the country. It is also one of the fastest-growing companies in the world in this industry.
You will need a minimum investment of Rs. 30 lakhs to start this franchise business. At the same time, the requirement for opening the store is a minimum of 300 square feet area.
You can choose spaces in a mall or near hospitals or clinics.
Amul needs no introduction as this is one of the oldest companies in India, selling multiple FMCG products. We hardly know any other butter than Amul’s, isn’t it?
So, you can start Amul Scoop or Amul Store, where you can sell different products of Amul. It will cost you around Rs. 2 lakhs to Rs. 5 Lakhs to set up the store and start the business.
It is one of the most profitable franchise businesses in India at present. The investment requirement is low compared to other similar franchises.
You would need a space to open the store, which must be 300 square feet or more. You can design the ice cream parlor as per your choices and preferences.
Nowadays, Pizza is a go-to food for youngsters and millennials. While there are many pizza baking companies in the country, Domino’s is the name that is reckoned the most regarding pizza.
There are over 500 outlets/ franchises in India, and it is in over 70 countries.
To open a Domino’s franchisee, you would need to invest around a minimum of Rs. 30 lakhs and have 1500 square feet of space.
The profit margin in this franchise business is quite high compared to others in a similar segment.
Regarding sweets and snacks, Indians always have a foot forward. Haldiram’s is one of the most famous sweet-making brands in the country.
Not only sweets, but it has a range of cookies, snacks, Indian food items, and a lot more. For this franchise, you need to have a space/area of 1000 to 1500 square feet.
The minimum investment requirement is around Rs.15 lakhs to Rs.30 lakhs. The profit margin is quite high, and so is the demand for most of the products of this brand.