Hotline: 1800 102 2007
X
Search Business Opportunities
Real Estate 2018-06-22

Anuj Kejriwal’s 5 Tips on How Franchising Works in Real Estate Business

The housing sector is expected to contribute around 11 percent to India’s GDP by 2020.

By Senior Sub-editor
Anuj Kejriwal’s 5 Tips on How Franchising Works in Real Estate Business

Infrastructure and real estate form the backbone of any country’s economy and in case of India, the backbone is strong and everlasting.

The Indian real estate market is expected to touch US$180 billion by 2020. The housing sector is expected to contribute around 11 percent to India’s GDP by 2020. In the period FY2008-2020, the market size of this sector is expected to increase at a Compound Annual Growth Rate (CAGR) of 11.2 percent. Retail, hospitality and commercial real estate are also growing significantly, providing the much-needed infrastructure for India's growing needs.

For those who want to know more about franchising role in shaping the real estate business, here Anuj Kejriwal, MD & CO – ANAROCK Retail explains in the following points how franchising works in real estate business:

  • The system of franchising has been at play since the '90’s and has proved to be a very successful way of conducting retail business - especially in terms of retailers' expansion plans. Interested franchisees identify categories and brands that they are interested in and short-list those that meet their budgets. In the case of high-value brands, only experienced and well-heeled players can afford to make an outreach to such a brand.
  • In most cases, prospective franchisees will get in touch with consulting firms which specialize in franchise opportunities, and after initial communications will meet up with the firm to understand the terms and conditions. Such a consultancy will be quite experienced in not only helping a potential franchisee to identify the most suitable brands based but also in terms of the city, the prevalent demographics there, and competition analysis.
  • If matters move forward from there, the intending franchisee incorporates a company and signs a letter of intent (LOI) or memorandum of understanding (MOU) with the franchisor. This contract creates a formal bond between the two parties, and the franchisee then proceeds to meet the agreed-upon financial requirements. The financial arrangement will usually involve an initial fee and ongoing monthly royalty pay-outs to the franchisor.
  • After the contract is signed, the franchisee must identify a property from which the franchise business can be undertaken. Depending on the category and brand, the property requirements may be quite specific in terms of location, size, fit-outs and tech enablement. The final location will be approved by the franchisor, often after a prolonged search by the franchisee has resulted in a short-list of suitable properties.
  • Then follows the actual building and/or interior fit-out of the premises, after which recruitment of suitably trained personnel takes place. At every initial step, the franchisor will provide the necessary support until the actual launch date as per the agreement.

Real estate business in the country has vast scope for those who want to explore and grow via the franchising model. Not only startups and entrepreneurs but experienced player too have enough space to cultivate their ideas and bear the profitable fruits of it.

Comment
Hari : 04, Jul 2018 at 11:40 PM
Hi Anuj, Why can't big realsters are not interested in midium level cities like TIRUPATHI, Mysore and nellore.if we start house construction business there with reasonable price we can get chance to get more profitability than concentrating in big cities.
Dinesh Dayal : 05, Jul 2018 at 11:36 AM
I am a real estate Consultant and working almost 8 years ,I had a my own setup in Noida and there were 15 people those work for LAND CONNECT Realty Consultants ,we earned well amount in such years but almost past 2 years business is very less my maximum pay/commission forfeited by many builders ...how can I get more success kindly tell us . thanks
Related opportunities
  • Bars, Pubs & Lounge
    About Us: Started by Praveesh Govindan & Celebrity Brazilian chef Guto..
    Locations looking for expansion Maharashtra
    Establishment year 2017
    Franchising Launch Date 2018
    Investment size Rs. 1 Cr. - 2 Cr
    Space required 1500
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Mumbai Maharashtra
  • Others Dealers And Distributors
    About Us: Mad About Dogs (MAD), an ambitious venture of Mad..
    Locations looking for expansion Delhi
    Establishment year 2006
    Franchising Launch Date 2018
    Investment size Rs. 10lac - 20lac
    Space required 400
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
  • Quick Service Restaurants
    About Us: Chowringhee is a well known name in Delhi NCR..
    Locations looking for expansion New Delhi
    Establishment year 2004
    Franchising Launch Date 2015
    Investment size Rs. 5lac - 10lac
    Space required 100
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater South Delhi New Delhi
  • Ice creams & Yogurt Parlors
    About Us: Makers of Milkshakes thrives on the cravings of the..
    Locations looking for expansion Telangana
    Establishment year 2017
    Franchising Launch Date 2018
    Investment size Rs. 20lac - 30lac
    Space required 150
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Hyderabad Telangana
Insta-Subscribe to
The Franchising World
Magazine
For hassle free instant subscription, just give your number and email id and our customer care agent will get in touch with you
OR Click here to Subscribe Online
Daily Updates
Submit your email address to receive the latest updates on news & host of opportunities
More Stories

Free Advice - Ask Our Experts