Technology Sep, 06 2014

How technology is helping franchisors

This goes for all. Whether big or small, every business owner looks forward to sustain that competitive edge in the market by picking up the best of technology oriented solutions. Check out how technology transforms the way businesses run and deliver quic

By Amanpreet Kaur, TFW Bureau
Chief Sub Editor
How technology is helping franchisors

Franchising and retailing businesses are nowadays successfully driven by widespread technology deployment. The trend of opting technology solutions is currently catching up excessively in India. Be it an existing or a new brand, technology has undoubtedly casted its spell on businesses across every nook and cranny of the country. From carts, kiosks, shop-in-shops, exclusive or multi-brand stores, every retail format is now dependant on technologically effective solutions to support and enhance store’s performance to an elevated level.   As the rat race of grabbing the top spot is fiercely growing among brands across sectors, the new and existing players are now realising the need for implementing technology oriented solutions to take their business to the next level.

Trending towards new technology

Twenty-first century has now opened new boulevards for technology-driven solutions that not only give quick results but aim at tapping businesses for enhancing productivity and effectively managing day-to-day operations. As the trends are transforming and consumers becoming more tech savvy, now brands are targeting the digital media to promote their brand, drive more customer walk-ins and generating revenues alongside. These days, many franchisors and retailers across various sectors are banking on technological solutions for successfully overseeing the store’s performance while sitting anywhere in the world.

The type of technology which is available in market involves – barcodes, radio frequency identification (RFID), point-of-sale (POS) software to track sales, financial management via comprehensive retail accounting system, surveillance equipments for security, billing and customer relationship management, (CRM), human resource management (HRM), mobile technology, internet, social networking and professional sites.

One of the brands that is offering technology solutions to franchisors and retailers is Capillary Technologies. They provide loud-based software solutions that helps retailers to quickly and easily manage their customer data, gain insights and personalise that engagement across social media, mobile, e-mail, online, and in store channels, driving a significant increase in sales and loyalty. Talking about the type of clients they target, Aneesh Reddy, Co-founder & CEO, Capillary Technologies, informs: “Capillary works with a variety of sub-industries across consumer-focused businesses such as the retail industry. These include apparel and accessories, hypermarkets and megamarts, quick service restaurants, sports and lifestyle item manufacturers and specialty segments such as jewellery brands. Capillary’s customers include industry leaders and universally loved brands such as Benetton, Raymond, Marks & Spencer, Puma, Pizza Hut and T.M. Lewin.”

Another brand – rTag has been introduced by Accretive Computer Systems Private Ltd to cater to education sector. Talking about the unique concept, Ajay Saini, Managing Director, ACS Group, says: “The rTag brand is basically focusing on Tracking the School Children’s by providing RFID CARD which sends the alert message to their parents in real time scenario of their entry/exit from school. rTag reduces the communication GAP between school and parents and it also increase the safety and security of children.” On offering the technology solutions to brands, he adds: “We are offering New and Innovative RFID based solutions to franchisors to become part of new technology business partner which has high potential in Indian market. RFID technology can be used in various industries and it solves various issues and provides Real Time information. RFID is the most recent prolific technology that provides supply chain collaboration and visibility. An RFID systems solution will increase corporate RoI while at the same time improving retail supply chain communication. Handled properly, RFID technology can result in an evolutionary change incorporating legacy systems with the real-time supply chain management of tomorrow.”

Franchisors hopping on tech solutions

Many brands across sectors comprising of food & beverage, apparel, services, health, beauty, wellness, fashion, specialty retail and education are now relying on technology to serve its customers in a better way and push sales simultaneously. In the wellness industry, Four Fountains De-stress Spa looks for technology enabled solutions in all areas of work. Anurag Kedia, Director, Four Fountains De-Stress Spa, says: “Surveillance equipments help us ensure that brand standards are being met and any deviations can be quickly corrected. Monitoring is done remotely by the head office. Via billing and customer relationship management, we ensure that every guest who walks into any of our spas across the country gets registered in our database and we can track the entire lifecycle of the guest even when they are visiting different outlets. This allows us to engage with our guests much better and have very personalised communications with them.” Apart from that, all human resource (HR) processes at Four Fountains De-stress Spa including recruitment, joining, payroll, leave management, appraisals etc are automated on the HRMS and information is available across the organisation at the click of a button.   Also, the brand does not differentiate outlets as franchise or company-owned. Every outlet has the same level of technological sophistications, systems and processes.

On the other side, Manpreet Gulri, Country Head, Subway Systems India Private Limited, feels: “In the franchising business model especially, technology plays an important part in terms of marketing, operations, and training. New marketing initiatives, new product/service launches and new procedures that need to be implemented are a few things that can be communicated via webinars, conference calls and virtual conferences. As for operations, reporting of sales through point of sale (POS) systems makes it easier for the franchisor to track income for royalty payments. SUBWAY® restaurants provide online training modules to all their employees in the organisation. SUBWAY® restaurant chain has internally-developed SUBWAY® POS software, designed specifically to support the unique requirements of its franchisees, customers, development agents and others. These are innovative softwares available to franchisees and development agents to track sales and KPIs on a real time basis.”

Another brand catering to jewllery sector – Sangeeta Boochra, a brand of Silver Centrre is also exploring the franchise route for expansion. Commenting on the technology solutions that they make use of at its outlets, Sangeeta Boochra ,Founder,  Sangeeta Boochra (a brand of Silver Centrre), says: “Yes indeed technology plays an important role in today’s world. We use SAP software to connect our stores with head office and extract information related to everyday sales, returns and purchases. We use Microsoft dynamics CRM and office 365 software to keep track of our clients’ buying needs which further enables us to give them better after sale services.”   

Investing on technology for effective management

Informing further about the capital that brands owners invest annually on buying and upgrading the new softwares and technology, Aneesh Reddy adds: “Enterprises are embracing technology to enhance the way they do business and also as a catalyst to create something new — new markets, new products, and new areas of growth and revenues. We see the first wave of large traditional companies starting to use technology as a driving force for their growth. Depending on their size and scale of operations, consumer-focused businesses typically spend between 0.5 per cent and 10 per cent of their annual revenue on technology infrastructure. Manufacturing and retail are typically at the low end of this range, while finance and health care are typically at the high end.”

On adding about the capital they invest every year to suffice technology needs, Sangeeta Boochra informs: “We invest approx Rs 1 million every year to upgrade our softwares and implement new technology on our business modal. We do not charge any fee from our franchisees for offering technology support. It is a part of our operational cost.”

While, on the flip side, Manpreet Gulri informs: “The company levies a small annual charge for the proprietary software that is provided to its franchisees.” On offering technology support to its franchisees, Anurag Kedia add: “We work on a software as service Model (SAS) with all our technology partners and hence there is no fixed up-front commitment or annual maintenance.  All outlets, company owned and franchisee owned pay a monthly fee to all technology partners.” 

Nordic Kandie, is the new entrant in the India’s confectionery market. Talking about the technology solutions, Thea Tammeleht, Founder & Director, Nordic Kandie, says: “We make use of mobile phone based technology. It’s a Mobile Point of Sale (mPOS) solution for card processing payments including cash. We spend 2 per cent of our income on technology enablement.”

Existing, emerging and new brands are cashing in on technology driven solutions to maintain logistics and supply chain with the use of new software. For instance, the distributors at SUBWAY® restaurants use state-of-the-art software to manage logistics. These softwares enable the brand’s franchisees to place online orders with their distributors and have the option of tracking supplies as well.  Also, Subway’s internal IT department assists its franchisees with tech support and software development.

Furthermore, technologically advanced solutions also reduce the work load of manpower as well. As far Four Fountains De-stress Spa is concerned, their area managers do not need to physically visit the outlets as frequently since audit can be done remotely. Even, payroll processing, leave management, appraisals and other such HR initiatives would take disproportionate time which is now much faster and simpler with the help of technology. To further augment their service delivery, “We are soon going to launch our call center which will help us to improve customer service as well and reduce the manpower requirement at our spas,” confirms Anurag Kedia.

What’s ahead?

To sum up, no one can deny the fact that technology driven softwares are certainly regarded as the tomorrow’s future. Seeing the vigorous growth of retail and franchise businesses across India, the demand of technology solutions seems to be unstoppable. Opting technology solutions is the way forward for franchisors as it not only reduces the work load of management but it helps in providing quick results and boosting productivity and profitability.

Go ahead and invest on cost effective technology softwares to maximize your profits by improving your store’s overall efficiency and performance. Franchising and retailing businesses are nowadays successfully driven by widespread technology deployment. The trend of opting technology solutions is currently catching up excessively in India. Be it an existing or a new brand, technology has undoubtedly casted its spell on businesses across every nook and cranny of the country. From carts, kiosks, shop-in-shops, exclusive or multi-brand stores, every retail format is now dependant on technologically effective solutions to support and enhance store’s performance to an elevated level.   As the rat race of grabbing the top spot is fiercely growing among brands across sectors, the new and existing players are now realising the need for implementing technology oriented solutions to take their business to the next level.

Quick Facts:

  •  According to ‘India RFID Market Forecast & Opportunities, 2018’, the RFID market in India is forecasted to grow at the CAGR of around 25% during 2013-2018. 
  •  6Wresearch confirms that the growth of India POS market is primarily driven by increasing modernization across major industry segments such as Retail, Healthcare, Transportation and Food and Beverages. Further, increasing use of debit and credit cards is also fueling the growth of POS market in India.

Related: Spreading the profit virus!

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