In the last few years someone who has realised his true worth is the consumer. He has emerged as the focal point of all services and is being pampered in every possible manner. Owing to newer set of services being introduced with every passing day, custom
India is witnessing a consumption boom. In today`s age the consumer is the king. Entrepreneurs are offering newer services to lure the consumer as today`s consumer has got more money but lesser time to finish the tasks on hand. This has led to the emergence of new business concepts offering professional services like dry cleaning, pest control, party planning etc. For instance, Mrs Sharma who is a banker can relax on her daughter`s birthday as the party planner is there to take care of the party that she is planning to throw to her friends and family members.
From home cleaning to car cleaning, concepts that were considered `foreign` have now made a mark on Indian shores. Catching these concepts fast, Indian as well as international companies are offering services which were not prevalent in India till a few years ago. To get your car clean you can now visit a car cleaning centre which takes care of it. Further, looking at the need of all these services across the nation these speciality service providers are taking the franchise route to reach out to masses. It not only helps in reaching the far flung areas but is also the fastest and cheapest mode of expansion.
Importance of speciality service franchise
In a service business, being approachable is the biggest advantage. Franchising, a way to partner with entrepreneurs makes the services easily accessible to the customers giving your brand the required boost. Many companies have taken the franchise route to expand their service network all over the nation. Even experts consider the best way to promote a service business is through marketing programmes like franchising. Lesser time required in profit generation and being a low cost opportunity have further added in popularising service business as a leading franchise business.
Optimistic about the future of speciality services in India Vikaas Gutgutia, MD, Ferns N Petals says, “The future of speciality service is very bright in India and is growing at a fast pace as the percentage of the working class is increasing and with this the spending power is also increasing. Today people opt for the specialised services as they are sure of the delivered quality and the value for money.”
He further adds, “Moreover the companies which are providing specialised services are facilitating their customers in one or the other way and are becoming easily approachable. So according to me specialised services would go a long way.”
Talking about taking the franchise route for expansion of Tancean services Sunil Uplap, Managing Director, Tanclean Pvt. Ltd says, “Franchising is considered the best option for multiplying the business rapidly and making it available to the masses immediately, since we address a basic necessity for survival of mankind.”
Tanclean decided to franchise in 2000 when its initial experience of doing the business in Thane and Mumbai was very successful for more than a year.
Godrej Hicare started franchising in 2004. Most of the companies had self owned outlets before franchising, whereas Godrej HiCare went against the wind and started its business with franchising outlets.
Within 24 months of commencement of laundry & dry cleaning services, White Tiger decided to develop the franchise module and on date more than ten successful outlets are functioning under the franchise module.
Godrej is a trusted household name that`s been around for a 100 years. The group, which has vast experience in pesticides and home insecticides for over two decades has recently entered pest management services with the vision of becoming the largest and the most preferred service provider to homes and institutions in India. Godrej`s continuous endeavour is to provide safe and most relevant technology in pest management.
Various services offered by Godrej Hicare include: Intelligel advanced cockroach management, convenient application that kills hidden cockroaches; Termin-8, which is designed to manage termites; Rodex, the advanced rodent management service; and services to control woodborers, bedbugs and mosquitoes.
Godrej Hicare operates through a network of 46 outlets across the country, out of which 23 are run by franchisees.
Talking about the future plans, Anand Seetharaman, Executive Vice-President, Godrej HiCare Ltd, says, “It is an evolving sector and we see it growing exponentially in the future. As far as our company is concerned, we have a strong outlook towards the future.”
Further elaborating on the training given to each franchisee Seetharaman says, “We have an infrastructure to monitor activities of our franchisees.”
A technical course for three months is conducted for each franchisee, post which they need to clear an exam which will then certify them as legally sanctioned to start a franchising outlet of Godrej HiCare.
Godrej Hicare franchisee:
The franchisee should have experience of managing and motivating sales force, team of technicians experience in managing record keeping and comfortable with computer. Being in the business of pest control the SCI needs to have customer orientation to serve them in all adversity (able to manage own fears and defensiveness).
The owner or a person nominated to the company`s satisfaction should be investing his time in building the business and should give high priority to customer service and quality orientation to be able to meet Godrej standards. The break even period for a Godrej Hicare franchisee is three years. Profits can start coming in a year or two.
The water-based Industry in India is estimated at about Rs 18,000 crore which includes drinking water, industrial & process water and waste water treatment and purification. It is totally an unorganised sector and the industry is in the process of slowly being professionalised.
In India, and even in the developing world today, the general public is not aware of the requirements of proper hygiene and healthy sanitation conditions, particularly relating to drinking water, which is the source of more than 60 per cent of diseases that affect mankind.
The need for scientific cleaning of drinking water storage tanks has primarily arisen due to rapid urbanisation of India, where the demand is way ahead of the supply, which emphasizes the need to have more and more water storage facilities at various points of distribution. This in turn necessitates maintaining the rapidly rising number of tanks in a scientific and professional way to keep them totally hygienic and safe.
Tancleantm has overcome all the demerits of conventional methods of manual cleaning of drinking water tanks with a six stage scientific process of cleaning and disinfection of the drinking water tank rendering it totally safe and bacteria free. The process works in almost the same economics of operation as the conventional methods.
Tanclean cleans around 1200 tanks everyday in about 90 cities and towns in 21 states in India. It has 280 franchisees and about 40 more are in the process of commencing the commercial operations shortly.
Talking about expansion through franchise route Uplap says, “We expect to have at least one franchisee in each and every town having population of more than three lacs. In the next three years we have identified about 400 cities and towns where we would target about 800 franchisees to serve the people.”
In the speciality services business training plays a major role to make the franchisee competent to run the business. Uplap says, “We have a full-fledged in-house training department headed by a training manager who takes care of the initial training and the subsequent refresher training sessions required for the franchisees and their staff, for various aspects of marketing and communication skills; further we have regular motivational workshops conducted by professionals in the industry.”
He further adds, “We also provide complete training for execution operations of the business where various aspects of maintenance and efficient job execution are practically provided.”
The prospective franchisee should have prior working/business experience, preferably in any competitive service based or housekeeping industry and should have a liking for general hygiene and cleanliness. The franchisee is also required to provide for at least four persons in its set up, one of them to be trained for marketing, another to be technically trained for supervision of cleaning operations and servicing of specialised cleaning equipments and the other two to work as cleaning operators.
A franchisee not only works under the guidance of the franchisor by following his direction, a speciality services franchise also plays a major role in developing the business. To this Uplap says, “The franchisee should be willing to work hard under our guidance and directions and should be able to commit full-time personal efforts and attention for the development of this business.”
Profits and break-even:
Talking about the break-even period for the franchisees Uplap says, “Since this is a basic necessity that we are addressing which has a high rate of repetitive service requirement at least three times a year, the business reaches its break-even right in the first year itself.”
He adds, “We have franchisees who have reached a break-even in the seventh month of operation itself.”
On an average, a franchisee starts making profit after recovering the investment, between 12-18 months of operation.
In India, dry cleaning was initially considered esoteric and availed only by the upper class alone. But, as fashion permeated different classes, fabric care became integral to lifestyle and with it, demands for dry cleaning of expensive clothing stepped up.
However, this led to mushrooming of service providers many of whom conducted business at heavily discounted rates while keeping their customers in the dark on how their precious clothes were treated.
It was in the midst of this dirty unorganised mode of business, that the Noida based Dhrovv India Limited launched a chain of dry cleaning & laundry stores under the brand name of White Tiger in 2002.
Operating from its mother plant in Noida with a built-up area of 70,000 sq.ft, the dry cleaning and laundry services major employed world class equipments & trained personnel to deliver door step services to quality conscious customers.
The laundry & dry cleaning industry in India is estimated at more than Rs. 2,000 crores and the brand White Tiger is presently based in Delhi & NCR where, in a by and large disorganised sector, the brand can easily boast of more than 30 per cent share of business in the organised sector in just five years of its operation.
White Tiger has ten franchisees and all efforts are being put in to establish another ten to fifteen franchisees in the financial year 2008-09.
For supporting the franchisees an established software is installed for the system standardised at all outlets and proper training is provided in the plant in all the departments before the opening of the outlet. Two customer care executives at every outlet are fully trained before they are put on the job. Refresher training courses are organised at regular intervals.
Break-even in one year.
Weddings are a recession proof business in India, considering that a majority of Indian population is under the age of 30. The wedding industry in India is pegged at Rs 3500 crores, out of which Rs 98 crores is what the online matrimony market consists of. The category has been growing at a rate of almost 50 per cent year on year, and will be seeing a huge surge in the coming years. Though the Indian wedding industry to date remains largely unorganised some companies are making it an organised industry with their professional services. Shaadi.com is one such company.
Talking about the launch of Shaadi.com Centres in an unorganised matrimony market, Omprakash Hassanandani, Business Head, Shaadi.com Centre says, “We wanted to alter the hitherto unorganised wedding industry in India, and give it a more organised and defined shape.”
Shaadi.com Centre (earlier known as Shaadi Point) is the offline version of Shaadi.com, the world`s largest online matrimonial service provider. Launched in 2004, it is a national network of centres providing one-stop matchmaking services through retail outlets. Targeted at the facilitator (parents, siblings, relatives) of a bride and groom, Shaadi.com Centre allows members to sit in their respective cities and search prospective matches nationally and worldwide for their sons or daughters, according to their criterion. Today Shaadi.com Centre is present across 87 locations in India (which include Tier II, Tier III towns) and has a network of over 155 centres out of which more than 140 are franchisees, while the rest are wholly self-owned centres.
Talking about adopting franchising as a business model to expand, Hassanandani says, “When we launched the service we started with our own offices. However, after a short while we realised that it would be better for us to partner with people who had been in the retailing business. Their experience within local communities provides a local flavour to our offering, which would not be managed as efficiently if centralised.”
He further adds, “Combining our expertise in matchmaking with a franchisee`s experience in retail and local communities was the best bet to deliver superior service and a personalised experience to our customers; it also allowed us to expand and grow the business and reach out to a wider audience, in a short span of time.”
By the end of 2008 Shaadi.com is aiming at expanding its presence across Tier I and Tier II towns in India and launch more than 500 centres in India. It also has plans of entering the overseas market in the same period.
Talking about the kind of training and support a franchisee would get Hassanandani says, “We provide them with intensive product training combined with technical and operational training. We also train our franchisees in the mass media and advertising strategies we follow, so that they can maximise the visibility of the brand for their regions.
Franchisees are well trained in recruitment as well…after all we are in industry which involves dealing with people and building relationships, getting the right kind of talent is crucial in our business.”
The break-even period for a Shaadi.com centre franchisee differs from region to region. Normally, however, a safe average to take for a cash breakeven would be six months.
Indian logistics industry has been the backbone of our economy. Logistics sector is worth $90 billion. The sector is on an upswing and witnessing a robust growth. At present it accounts for more than 10 per cent of our GDP. Estimates suggest that the logistics sector will keep growing at a rate of 10-12 per cent in the coming decade. It is expected to become a $125 billion sector by 2012. The Indian logistics sector is predominantly fragmented with smaller regional players making up the larger share. There are hardly 12-15 large national players in this industry. Also, less than one per cent of the industry is organised. But with emergence of larger players, the industry has been witnessing a healthy growth. Companies like Safexpress hold a market share of 27 per cent.
Talking about the bright future of the industry, Pawan Jain, MD Safexpress Pvt Ltd, says, “The speciality service market has a very bright future in India. As the customers become more demanding, the services too need to be tailor-made to their liking. Therefore, not only every segment but also their various sub-segments have specific requirements. In order to cater to them it becomes imperative to provide them with efficient customised solutions.”
Safexpress began its journey in 1997 as a national company. It started franchising in the same year. It provides express surface, air and multi – modal connectivity and follows an outsourcing based business model.
Giving reasons for the franchise route Jain says, “Concept of franchising appealed to our business as we were looking at covering every square inch of the country. Franchise model was the perfect solution to our requirements.”
All outlets of Safexpress are managed by franchisees, which in turn are supervised by its company offices. The company has different kinds of franchisees working for different jobs like booking, delivering, trucking etc. At present its associates are managing offices in excess of 700. In addition to these, it has an additional 750 outlets run by franchisees.
Safexpress is looking at future expansion, as the business grows all across the country. In the near future, it is looking at adding a franchise a day.
The franchisees are trained in customer handling and are familiarised with the company`s operations through workshops. Safexpress associates need to have sound financial capability, have self-owned commercial vehicles and should be prepared to take responsibility.
If the resources are managed properly by the franchise then within a period of six months he is able to stand on his own.
At present, Safexpress is a Rs 500 crores organisation, growing at a phenomenal rate of over 30 per cent year on year. The company is aiming to attain Rs 1000 crore turnover by 2010. It has 41 hubs and superhubs, around 2,500 employees and a fleet of 3300 GPS equipped, weather-proof ISO-9002 certified containerised vehicles covering 5 lakh km daily. These vehicles are serving over 550 destinations and delivering 3 million packages every month. The warehousing space of Safexpress exceeds 30 lakh sq.ft.
Ferns n Petals
Ferns n Petals is a group of companies with its primary business being retail of flowers.
It is a Delhi based company, and the only branded chain of floral boutiques in the country having a wide network all over India. These boutiques offer a vast variety of fresh cut flowers and unique flower arrangements, artificial & dry flowers, and an exclusive range of object d`art such as scented candles, candle stands, imported Italian glass vases, wooden gift accessories with intricate carving, photo-frames, miniature exportable gift items, fragrance items based on aromatherapy and potpourris etc. The boutiques offer a great variety of exquisite flower arrangements and displays to match the distinct needs and tastes of the customers.
FNP has a wide range of flowers from a normal flower to a rare or exotic flower which is imported from abroad.
The company`s division FNP Weddings specialises in thematic wedding décor for high-profile weddings. FNP Events is into planning any corporate event or conferences. It provides one-stop-shop solution for all corporate related requirements ranging from venue selection, caterer, hospitality and entertainment to designing of invitation cards and trousseau packing.
The company`s other division Professional Hostess Agency brings a level of professional perfection by deputing well groomed hosts and hostesses for handling seminars, corporate events, workshops and for management of exhibitions etc. It also has an elite group of models to serve the advertising world.
The odyssey of Ferns `N` Petals retailing commenced in 1994 with the establishment of its first retail florist outlet. FNP entered into the franchising structure soon after and the first franchise outlet was established in 1996.
Talking about its market share in the flower arrangement business, Gutgutia says, “Flower arrangement market is huge in India. It is very difficult to describe it. Ferns N petals has a stand in the market and it undertakes approx. 20 per cent of the flower arrangement market.”
He further adds, “FNP has still to go a long way and is targeting to take over at least 50 per cent of the market.”
Started as a single outlet, today Ferns `N` Petals has become the only branded retail chain of florists in India, boasting of 60 outlets nationwide and `we have revolutionised the concept of franchising in this sphere`.
Profits and break-even:
Talking about the break even period Gutgutia says, “The break even period is approx. a year. After that one can start making profits. In some cases the break even comes within 6-8 months depending on the location and place where the shop is established.”
Sign A Rama
Sign A rama, is known as the world`s largest sign franchise.
It has been around since 1986 with its headquarters in the United States. It has grown over the years and has presence in over 50 countries now. The concept in itself is not new; it is new to India.
Sign A Rama started operations in India in October 2007 with two partners Daniel Peavy and Ravi Venkataramani taking its master franchise.
Sign A Rama franchisee;
Talking about the requirements from its franchisees Ravi Venkataramani, Director, Sign A Rama says, “We look at franchisees as partners in our business. We are all going to work together to spread the brand name. We want franchisees who are willing to work with us and we will give them the support and to take them to greater heights.”
About expectations from India Venkataramani says, “We expect 1,000 franchisees over time in India. We want it to be sooner but we expect that over 20 years we will definitely get our target.”
When the franchisee has gone through the evaluation process and has signed the agreement with Sign A Rama, that point on it assists the franchisee from selecting the location and helping them even negotiate leases. The franchisee and a couple of members from his team are taken to US for training at the company`s corporate headquarters in Florida. They go through a three week process training. Once this stage is completed then the franchisee is taken on to a short tour where they basically shadow the existing franchisees to observe the running of a Sign A Rama store.