Chal­lenges As­so­ci­ated with Franchising in In­dia

Images Retail - - COVER STORY | RESEARCH -

Franchising The first end em­ploy­ees rep­re­sent the brand and it is very im­por­tant for them to be skilled to per­suade cus­tomers to shop. is one of the sec­tors that has shown re­silience and con­tin­ues to grow in this tough eco­nomic en­vi­ron­ment; the sec­tor is not with­out risk for fran­chisees and fran­chisors. The re­al­ity is that no fran­chise is im­mune to tough eco­nomic con­di­tions - lev­els of suc­cess vary de­pend­ing on the con­di­tions - lev­els of suc­cess vary de­pend­ing on the con­cept, strength of the brand, man­age­ment and the in­dus­try. Points high­light­ing the chal­lenges faced by franchising sys­tem in In­dia: Hav­ing Suf­fi­cient Cap­i­tal - Busi­ness fail­ing due to un­der­cap­i­tal­i­sa­tion as the cost of cre­at­ing the fran­chisee sys­tem is not a new thing. New fran­chisors need to have enough cap­i­tal to cover the ex­penses re­quired to set up the fran­chisee in­clud­ing op­er­a­tions, mar­ket­ing, ad­min­is­tra­tive, and ac­count­ing. The cap­i­tal should cover fran­chise pro­gram that in­cludes staff and lead gen­er­a­tion. Build­ing a Solid In­fra­struc­ture - Nor­mally, a fran­chiser has the set SOP for the fran­chisee join­ing the busi­ness. But these pro­ce­dures aren't pri­or­i­tized by the fran­chisee of­ten fail­ing to achieve set ROI in the in­ten­tion of sav­ing on cap­i­tal. For long term as­so­ci­a­tion, it is very im­por­tant to un­der­stand the im­por­tant to un­der­stand the im­por­tance of strong in­fra­struc­ture and guide­lines. Hir­ing the Right staff In­creas­ing Com­pe­ti­tion (Mar­ket Share) - A num­ber of for­eign-owned brands are slowly in­cor­po­rat­ing into the In­dian mar­ket. The in­tro­duc­tion of these brands are giv­ing con­sumer more choices, hence the com­pe­ti­tion gets tougher and puts more pres­sure on the per­for­mance of home grown brands.

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