Food and Beverage Aug, 18 2010

Relish Sweet Benefits of Candy Franchise

Chocolates and candies are not only considered a child’s delight, but adults and oldies are also relishing the sweet treat. Franchising has propelled this industry to reach sky high. If you have a fetish for sweets and chocolates and want to explore bus

By Ramanjit Kaur
Feature Writer
Relish Sweet Benefits of Candy Franchise

Indians love sweets and their obsession for sweets have helped the industry to grow immensely. The emergence of international players to the Indian shores has further given the required boost as far as candies and chocolates are concerned. To keep a pace with the rising demand, few brands have taken the franchise route for expansion. In addition to this, the low cost franchise investments, less space requirement, and continuous support of franchisors for better returns, have motivated large number of entrepreneurs to take up candy and chocolate franchise. India being the second largest populous country in the world offers immense potential for such products. The article attempts to highlight the untapped opportunity of this highly potential industry.

Growth opportunity

The chocolate and candy industry in India is extremely fragmented with a wide array of products such as bars/slabs, jellies, lollipops, toffees and sugar candies to cater to a wide variety of consumers. The sector has a turnover of around Rs 3,500 crore, out of which the organised sector accounts for Rs 1400 crore. It is estimated that the sector will grow at a rate of nine per cent per annum. Vrinda Rambhia, Director, Premium Pralines Pvt. Ltd says, “India has a huge base for growth as the Indian consumers are always ready to experiment with the new and wide range of high-quality products being available. This is the major factor that helped us to select Leonidas and bring the brand to India to enhance the palate and evolve the taste buds of the Indian consumer.”

Franchising benefits

Undoubtedly, the industry for candies and chocolates is quite big with the presence of exclusive brands but when it comes to franchising, the industry is still in its nascent stage. There was a time when Cadbury and Nestle had a monopoly in chocolates’  and candies’ sector was soon followed by Amul. In spite of ruling the industry for so long, these brands never considered franchising. But with the changing economic scenario, and rising consumerism, brands such as Sweet World, Candy Treats, Leonidas, and Chocolate Room have taken the franchise route for expansion. Though franchising is still limited to few brands, this sector still has enough room for growth and offers low cost franchise investment opportunity through kiosks and shop-in-shop formats.

Eligibility criteria for franchisee

The sector offers lucrative franchise opportunities through its three successful formats: kiosks, shop-in-shop and standalone stores. The low cost franchise investment varies from brand to brand, for instance, to take up the franchise of Sweet World, an entrepreneur needs to invest Rs two to five lakh, while for a brand like Leonidas, investment may range from Rs seven to 50 lakh. Besides this, the franchisors require entrepreneurs to have a good location with high footfalls, and are dedicated to work hard. According to Vikas Panjabi, Director, The Chocolate Room, “We seek franchisees with qualities like financial credibility, favourable retail background, motivation to run the show and open multiple outlets, customer service skills to educate the customers about the brand.” While Rambhia says, “We believe in people with passion for their work, ambitious and who have a long-term vision. Every person has different skills and attributes that he/she bring into the business to make it successful.”

Support and services

As far as the support and handholding is concerned, the franchisors usually provide their franchisees with all the necessary training and assistance to get a grip of the business and operate it smoothly and profitably. The franchisors even help the prospective entrepreneurs with the site selection or rentals, staff recruitment, training and on-going support.

Future outlook

Sugar confectionery is the largest product category which includes hard-boiled candy, toffees and other sugar based candies followed by chocolate and gum category. With the rising demand for these products, the industry is speculated to remain as the most lucrative category in the near future. Apart from this, the sector is alluring foreign brands to establish their base to get a fair share of the Indian market. In short, the industry offers immense opportunities to the aspiring entrepreneurs with low cost franchise investment and high return benefits.

Related: Savouring success with local taste

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