|
  






  ||






|
|



|




 

|

|
| !" #
þ $% Archies Gifts & Greetings-creating a large networking:-
Archies was set up in 1979 as a partnership firm to carry out the business of manufacturing
and marketing posters and greeting cards.
The first store is set up in 1987. In 1990,the business of the partnership firm was taken by
archies greeting & gifts pvt ltd.
Earlier archies were into family business of saree and from these they started making
posters. The company then got demand for getting cards and began to deal in them . After
that they started opening exclusive store. They have created a brand and now the company
has a strong network at over 400 franchise store.
Archies success was due to innovative product that were price-sensitive and of good quality,
retail branding, creation of a wide network through the franchising route.
 
&&
þ h
?


 ?  



  
AHLL is a 100% subsidiary of the Hyderabad-based Apollo hospitals group. The group came up
with the concept of setting up specialist clinic.
These clinic offers specialist consultation, comprehensive diagnostic services, a range of preventive
health check package and 24 hr pharmacy. There is also a telemedicine facility from an expert panel
of doctors.
AHLL has now forayed into opening franchised clinics. The company already has 15 clinics
inahmdabad,bangladesh,delhi,ghaziabad,noida,faridabad,gurgaon,jaipur,kolkata,jamshedpur &
silliguri.
The model is such that the franchisee has to invest in the clinic as well as manage day-to ±day
operations.
÷
 
      AHLL plan is to control opportunity in the international health
market, primarily through franchise route.
It is understood that the company has already signed a master franchisee agreement with starcare
health system pvt to set up 8 to 10 Apollo clinic in Bangladesh.
The organization plan to ensure consistently superior quality service in every sphere, ranging from
personnel and infrastructure to equipment and operating procedure and these will be transferred to
the franchisee.
 
&
þ  
  
  


BPL went in for franchising by establishing BPL mobile galleries(BMG),so while designing
the payout, kept the following in mind.
1) BPL did not want any fixed payout, typically it was a minimum guaranteed commission.
2) It wanted revenue-sharing arrangements for genuine involvement of franchisees.
3) The payout should be weighted towards services element more than sales commission.
The only quantifiable elements in its business that could be linked to service were billing
and collection. In its billing the company classified each customer according to his primary
address in the gallery area as a cost centre. Now the customer is mobile, he can be
anywhere in the network and pay his bills anywhere. This ensure that it can keep track of
billing, collection, outstanding for each franchises.
 
&&
The system is slightly different in the metros, the galleries in the metros are pure retail outlets.
This means the franchisee attends to only a walk-in subscriber and has no field staff. There
are no cost-centre allocations. For example, the franchisee gets Rs.150 for each roaming he
assigns from his gallery. The franchisee also gets one percent on all cash and credit card
collections and no commissions for cheques collected. The payout model of the BPL
franchise has been a successful one and the organization has 82 galleries at present
(including a few of its own). These are expected to grow to 100 before the end of 2003 in
all its operating circle areas. The key challenges in successful franchise operations in India
includes larger commitments from the parties involved, greater handholding through
turbulent times by the franchiser and having a consumer-oriented perspective to the
relationship between the franchiser and the franchisee with common goals and
understanding
ù '  ( )
ù
Y 

  




   
  

UA business owner who is considering expansion via franchising can try and test the franchise by
carrying out a pilot model initially. Pilot franchising allows the aspirants to assess the business
model before investing in it. The potential franchisor can sign an agreement with a pilot
franchisee for a specific time period to test his business. If the franchise does well, the franchisor
can make his pilot franchisee as his first franchisee. However if it fails, the pilot franchisee would
still gain rich experience and earnings as well.

UFranchising is about building on a simple, easy-to-learn, tried and tested method for conducting
a business. The pilot operation enables the prospective franchisor to assess the factors that will
form basis of the expertise and know-how that he/she will transfer to the franchisee, such as the
type and size of location, the equipment required, the operating methods, and marketing and
financial requirements.
 › 

 
›


Pilot operations are used as a basis for testing the original franchise model. The
franchisor can gauge whether his venture would be successful as a franchise business
or if he should stick to his expansion via company owned outlets.. Having a pilot
franchise can assist the franchisor in the following ways:-
Up




 

A business may be successful on a small scale but expanding it through franchising may
not prove to be profitable. However, if the business has been operating successfully
for a long time then there is no need for testing the idea.
Ua  


A successful business may work well with one outlet business. Expansion of
such a business can be done by another owner at a distant place to test its
adaptability. Maybe the business has been successful only due to its strategic
original location or because of the business acumen of the owner. Therefore,
franchising it without a pilot operation may prove devastating for both the
franchisor and his franchisees
U p




  

A pilot franchise can be used to test the feasibility of a business as a franchising business. A
business which is running successfully expanded via company owned outlets might not do
well via franchising. This may be due to the potential franchisor¶s inability or lack of franchising
credentials. Therefore, operating a pilot franchisee can be a good idea for testing the suitability.

UV


 


After franchising, a business is bound for certain innovations. The franchisees who are partners in
the business have to inculcate innovative ideas for the betterment of the franchise business
Few franchisors might not find such innovations acceptable. Therefore, franchising may not be
apt for them. Having a pilot franchise can aware the potential franchisors of such changes
while coming up with a franchise plan.

p
 




 



 


 



 
 






 

  


 

 

 

 


 




 

 

 



 

p 





 





 


 




 
ù 


 

! " 
#


The franchise model has been one of the most prevalent and successful formats of
retailing in India. Global players like US-based Tommy Hilfiger, Netherlands-based
SPAR International, Argos, , Costa Coffee, Domino¶s Pizza, Subway, Mothercare and
McDonald¶s have become forerunners in India through the franchising route.

#
$ 
%    

‡#  & '  ( Here the Franchisee retailer purchases products for
‡ retail sale from the Franchisor, e.g. lifestyle products, Florista.

‡' '   Here the franchisor markets a service or a product under a
common name and a standardized system, through a network of franchisees,
e.g. The Medicine Shoppe, Big Bazaar, Shopper¶s Stop.
 #



! " #

‡$ 


In a pure franchise model, the franchisor does not make any investment in the
franchisee¶s business. Under this model, the franchisor is entitled to get
franchise fee for providing access to foreign brands and providing know-how
on the methods of distribution, merchandising, packaging and promotion.

‡›)

A  
 is an arrangement under which operational control of an
enterprise is vested by contract in a separate enterprise which performs the
necessary managerial functions in return for a fee.. A management contract can
involve a wide range of functions, such as technical operation of a production
facility, management of personnel, accounting, marketing services and training.
U*'" › Y

A hybrid business model combining the strengths of retail operations like store
fronts or internet sites with the power of distribution channels and the systems
employed by franchising. It is a complete manufacturing to the consumer model
(MTC). Hybrid business model provides you with the ³Be-your-own-boss´
benefits of a traditional business , ³the blueprint for success´, benefits of a
franchise and the extraordinary host of benefits of the networking marketing
business models
ù*%" +' ', ' "' '  ,  # # ' !"
','   (-

Reasons for entrepreneur getting into franchise operations in India are:

þThey help in creating a large network: For example Archies greetings has increased
its business by creation of a countrywide retail network through the franchise route.It¶s
very difficult in country big country like india to reach masses by independent
businesses and therefore franchise is the better option.

þIn Franchise cost can be shared as ?

 

 is going their
primary focus is on Franchising because it save their money for land and other thing. It
is cost effective too. franchisee have to invest in project and have to be responsible for
day to day work.it reduces work load also from main company.
ù.% !" #((' ''# /  ' "
) '', "!' "0 !'1  
 (-! 

ues, franchising a desired route for foreign multinational that want to operate in the
retail sector in the absence of FDI in retail in india as Big brands cant come up with
their own retail store because of government regulations. Until now, global retailers
were required to sell their products through franchises or wholesale trading. Recently,
in a significant step towards liberalizing India's retail trade, the government had
decided to partially open the retail sector by announcing 51 percent FDI in single
brand retailing - a move that should pave way for big names like Nike, Versace,
Addidas, Marks & Spencer to set up their own stores in India.