Entrepreneurship 2014-04-11

Ideal location,assured success

Before deciding upon any major aspect in a franchise business, you must first decide where exactly is your store going to be located. Selecting a right location holds a vital role in the success of any business. Many businesses have failed just because of

Ideal location,assured success

Will the customers drive to my store? Will it be a convenient place? Will the customer feel safe here? Will my store be a neighbourhood shopping place for them? All these questions must arise in the mind of a franchisee or franchisor before finalising any spot for his store. Sales and service- The most important facet in a store can also be affected by the location. Arun Raje, CEO, Tech Guard Technologies says: “Each business is unique in its design. While some require road front properties, others require larger open areas. The requirement is based on the product and business model.”

Moreover, the better the location, the superior are the chances for a brand to beat the competitors. But, without proper market knowledge and sufficient study, nobody can be a champion in site selection process.

Desired location

The franchise market in India has the potential to grow to $20 billion by 2020. In this growing market, every brand wants its stores to be present in the best malls and high streets but certain factors like cost and availability can stop them. For most niche brands in Retail sector, the most desired location has always been Malls. Many internationals brands that have entered Indian market recently have opened their outlets in Malls and high streets only. Sunshine Kebabs, a brand from Australia has recently entered India. Chaitanya Kumar, Managing Director, Sunshine Kebabs says: “Before opening any outlet, we do a systematic survey of the location proposed by the franchisee. After complete market study and other provisions, location is finalised. Our priority is always high street and ground floor locations.”

Kaivan Shah, VP, Aarya 24kt says:" One of the major factors why Aarya 24kt has been Successful in all their franchisees so far is the right decision in selection of the location . Targeting the right segment of customers as per your product category is one of the prime things . Right Product marketed at the right place will always grow with maximum number of customers . Even though the commercials vary from place to place in selecting the right place , it is very important to give preference to the location and then put the estimates and targets."

Favoured destination

Expansion through franchise route is an inclination these days. Most brands want to expand fast via the franchise route and wish to spread across every city on pan-India basis. Depending on the liking and the business prospects it holds, brands have their favourite destinations too. India is witnessing a phenomenal increase in the spending capacity. Raje of Tech Guard Technologies agrees that several cities like Kanpur, Jabalpur, Nashik, Kolhapur, Rajkot, Bikaner and many more are now much more promising than they were a couple of years ago. The shift in the perspective of the customer, exposure to global brands, innovative brand marketing by companies and incubation of a different model by large brands to cater to these new and promising markets makes it more exciting to see these cities commanding a sizeable share in the gross revenue for a brand. The same will be more visible in the next couple of years when more brands leverage on this opportunity as against the saturated metro markets.Franchisees already running a franchise business and planning any relocation must start location selection at least nine months in advance. Shah of Aarya24KT opines:" Aarya 24kt products deals in a category where every one can afford it . We have always preferred malls in tier I cities where we can get maximum foot fall and in tier II cities, the mall culture is yet to pick so we have given more preference to high streets . We have always preferred to do society marketing but never looked for a franchise outlet in a residential area."

Market research

A franchisee or franchisor must conduct market research before finalising any spot. Find out if there is a need for your product or service and who your competitors are, their strengths and weaknesses and how your business will differ from theirs. Putting lots of effort into research and study will help you conclude whether you can turn your location into a profitable business or not.

Factors that make a location superior:

•    Parking facility- The location must have a hassle free parking space where customers can just park their vehicles and start shopping without any waste of time.
    Population- The store must be located at a fairly populated area. Chances of a store working at an isolated area are very less. Moreover, the store will have to bear extra expenses also to manage the store at such an abandoned place.
•    Visibility: The name of the store and its entry must be clearly visible to the buyer. Visibility plays a major role in the sell out of its products.

•    Accessibility: The location must be easy to reach. Means of transportation should be extra and the spot must offer easy access.
•    Feeling of safety: The location must be easily reachable and provide the customer with a feeling of safety upon their arrival and exit.

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