Navigating Conflict Resolution in Indian Franchise Businesses

India's franchise sector has witnessed remarkable growth over the past few years. As of 2024, the industry was valued at approximately ₹12,500 crore, with projections indicating it could reach ₹140–150 billion in the next five years, according to the FranCast Whitepaper on Franchise Forecast 2023-24. The country now ranks as the second-largest franchise market globally, with over 4,600 active franchisors operating nearly 200,000 outlets.

Key drivers of this growth include:

• Urbanization: With 38% of India's population residing in urban areas by 2024, there's a significant demand for organized services.
• Tier 2 & 3 Cities: Nearly 50% of franchise expansions from 2021–2024 occurred in smaller cities, driven by rising disposable incomes and untapped markets.
• Government Initiatives: Programs like Startup India and Skill India have provided subsidies and easier licensing for entrepreneurs, further fuelling the franchise boom.

The Importance of Conflict Resolution in Franchising

Conflicts are inevitable in any business relationship, and franchising is no exception. Disputes can arise over various issues, including royalty payments, operational standards, marketing strategies, and territorial rights. If not addressed promptly and effectively, these conflicts can lead to strained relationships, legal battles, and damage to the brand's reputation.

Effective conflict resolution is crucial for several reasons:

• Maintaining Brand Integrity: Ensuring consistent quality and service across all franchise outlets preserves the brand's reputation.
• Ensuring Operational Efficiency: Addressing operational challenges promptly prevents disruptions in service delivery.
• Fostering Positive Relationships: Resolving conflicts amicably strengthens the partnership between franchisors and franchisees.

Here are a few key mantras that industry leaders swear by, to resolve conflicts in their respective businesses: 

• Building from the Ground Up: The Power of Support and Collaboration

Mahendra Sureka, Founder & CEO of MACJ, highlights a crucial yet often overlooked reality of franchising in India — launching a new concept in a market unfamiliar with the idea. “When we started in India six years ago, we were not only selling a new brand but also a very new idea and service,” he recalls. MACJ is a professional home inspection company operating in India, partnering with A Buyer's Choice Home Inspections (ABCHI) USA, a leading global home inspection company. They launched home inspection services in India in 2016 from Kolkata and expanded to multiple cities thereafter. 

In their early days, MACJ signed franchisees in Mumbai, Pune, and Gurgaon, while managing operations in Kolkata directly. However, there was little to no business initially because the Indian market was unaware of such a service. Rather than letting franchisees fend for themselves during this difficult period, Sureka adopted a hands-on approach. “I used to travel to Mumbai, Gurgaon and Pune regularly… even when there was no business coming in. The aim was not just to manage the immediate expectations but to create a support ecosystem by identifying pain points of Indian consumers and building a service around them.”

This experience underlines the importance of responsiveness and presence in conflict management. Instead of retreating when business is slow, franchisors must lean in, guide their partners, and co-create solutions. Today, MACJ’s earliest franchisees are its strongest advocates — a testament to the value of collaborative conflict resolution rooted in transparency, presence, and persistence.

• Transparency as the Cornerstone of Conflict Prevention

Arunabh Sinha, Founder of UClean, a well-known chain of laundromats, dry cleaning, and home cleaning services operating in India, offers a more systemic perspective. “Conflict management is the toughest part of running a franchise business,” he admits. Sinha, an IIT Bombay graduate, founded UClean in 2016 with the goal of organizing the Indian laundry market.

For him, transparency isn’t just a tool for conflict resolution — it’s a preventative measure.

He identifies three critical stages where transparency plays a key role:

1. Initial Sales Pitch: Many conflicts arise due to overpromising or misaligned expectations set at the beginning. A transparent pitch that doesn’t hide challenges sets a realistic foundation.
2. Ongoing Business Operations: Transparency during day-to-day operations helps in solving small problems before they snowball. “This is the reason I am a part of more than 700 WhatsApp groups with my franchisees,” says Sinha. “It’s not micromanagement, but a system for real-time feedback and rapid response.”
3. Intent to Resolve: Even if not all problems can be solved immediately, the genuine intent to address issues builds trust. “Demonstrate that intent to your franchisees very transparently, that’s how you can resolve a lot of challenges in the starting phase itself,” he adds.

Sinha’s model shows that conflict resolution is not about reacting to problems — it’s about cultivating an open, honest, and intent-driven culture where conflicts are less likely to occur in the first place.

• Empowerment and Accessibility: Balancing Control and Autonomy

Franchising often walks a fine line between centralized control and local autonomy. Jasmeet Singh, Chief Commercial Officer at MakeMyTrip, explains how their franchise conflict strategy is built on two core principles: accessibility and delegation of power.

“We’ve created a hotline for our franchisees so they can connect with us for any issue when their customers are travelling to any part of the world,” says Singh. “This ensures that support is never too far away, especially in customer-facing businesses where timely service is crucial.”

However, Singh is also clear that not everything should funnel through the central team. “We have given our franchisees some powers wherein they can take decisions on the brand’s behalf. Empowering franchisees not only reduces bottlenecks but also builds ownership and accountability. This balance of accessibility and autonomy creates a healthier dynamic where franchisees feel supported but not stifled.”

MakeMyTrip.com, India's leading online travel company was founded in the year 2000 by Deep Kalra. Created to empower the Indian traveller with instant booking and comprehensive choices, the company began its journey in the US-India travel market.

Strategies for Effective Conflict Resolution:

1. Clear Communication from the Onset

Setting clear expectations during the initial stages of the franchise agreement can prevent misunderstandings later. Both parties should have a mutual understanding of roles, responsibilities, and performance metrics.

2. Regular Training and Support

Continuous training ensures that franchisees are well-equipped to handle operational challenges. Ongoing support from the franchisor helps in addressing issues before they escalate into conflicts.

3. Establishing Clear Channels for Feedback

Creating platforms for franchisees to voice concerns and provide feedback fosters an environment of open communication. Regular surveys, meetings, and digital platforms can facilitate this process.

4. Timely and Transparent Resolution

Addressing conflicts promptly and transparently prevents them from escalating. Both parties should work collaboratively to find solutions that are in the best interest of the brand and its customers.

5. Legal Framework

Having a well-defined legal framework in place ensures that both parties understand the procedures for resolving disputes. This framework should be fair, transparent, and mutually agreed upon.

 6.The Role of Technology in Conflict Resolution

Technology plays a pivotal role in modern conflict resolution strategies. Digital platforms can facilitate real-time communication, allowing for quick identification and resolution of issues. Additionally, data analytics can provide insights into recurring problems, enabling proactive measures to prevent conflicts.

The Crux

As India's franchise industry continues to expand, effective conflict resolution will be paramount in ensuring sustainable growth. Conflict resolution must evolve from reactive firefighting to proactive relationship building. By adopting proactive strategies, maintaining open communication, and leveraging technology, franchisors and franchisees can navigate challenges collaboratively. For Indian franchisors, the path forward lies in creating ecosystems of trust, support, and shared vision — because when franchisees win, the brand wins.