FRANCHISING GROWTH
Several professional academicians as well as entrepreneurs are choosing to go the franchise way in the tutorial and coaching industry.
The tutorial and coaching industry in India has been bourgeoning over the last decade at a very promising rate. Indian parents’ academic aspirations for their children are driving the growth of this industry. As per a survey by ASSOCHAM, the size of the private coaching industry in India was about $ 23.7 billion in 2013 ( Rs 1,41,416.33 crore) and is likely to touch $ 40 billion ( Rs 2,38,677.36 crore) by 2015. With the way things are progressing, the industry is getting increasingly organised. Teachers are no longer looking at coaching as a way of earning a parallel income but are plunging into this lucrative and very fulfilling profession in a very meticulous manner. This is where the franchising model comes into play in this sector.
Those who are looking to make a mark as professional tutors are opting to take on franchises of established institutes. A franchise of an already reputed name comes with its stamp of quality and assurance of high level academic competence. Hence, parents prefer to send their children to such franchises as they feel assured of good results and the required level of prowess in the faculty. Keeping this in view, several professional academicians as well as entrepreneurs are choosing to go the franchise way. They are entering into associations with well- regarded tutorial providers to give their business the right springboard for success. This is a mutually beneficial partnership as the new entrepreneur finds a ready market for his/ her services and the coaching institute’s name spreads across the length and breadth of the country.
Reputed institutes, however, are extremely careful before they enter into a franchise agreement with any tutor or business person. The franchise model enables the institute to penetrate its reach in tier two and tier three cities of the country and to bridge the gap of literacy through scholarships, virtual class rooms, tablets etc. Yet, there are various stringent evaluations that are carried out before an agreement for franchising is entered into.
The primary factor to be considered is whether the franchisee is capable and equipped to provide the same standard of coaching to its students as the parent company. Since the franchisee will bear the company’s trademark, it is imperative that the reputation of the franchisor is maintained. There are several other areas that are scrutinised before one enters into a franchise agreement. An understanding of the local market that the franchisee is penetrating is very essential. One has to also make certain that the person taking up the franchise has a 100 per cent commitment towards the cause of coaching and will not run it as just a means to make money since the future of students is at stake. The financial capability to meet the franchisor’s standards of IT, infrastructure, necessary facilities, and equipments is also a key element.
The franchising model has a very promising future when it comes to the coaching industry. However, the model has to be well- executed. In some cases, the degree of precision required when drawing a franchise agreement in this specific industry may be much higher than other industries. This is for the simple reason that besides running a business, one is also making the promise of shaping the future of the youth of this country. If the franchisee is able to meet the expected standards set up by institutes of national repute, the alliance can be very fruitful for the franchisee, the parent company and most of all, for students in all parts of the nation.
Chaudhry is director, Aakash Educational Services