With interest being generated in the health and beauty-care sector, companies are seeking to expand their business into this sector through different routes. Interestingly, most of the brands have chosen the franchising route to expand. Franchising is a b
With interest being generated in the health and beauty-care sector, companies are seeking to expand their business into this sector through different routes. Interestingly, most of the brands have chosen the franchising route to expand. Franchising is a business strategy a company may use in capturing a market share. “We were successful in our ventures mainly because of franchising. In 1979, our first franchise was opened in Calcutta, where I trained one of my friends, Threety Irani, and gave her the rights to use my brand name and my specialized treatments. In 1980, we entered the international market through the Festival of India in London where we rubbed shoulders with the biggest international brands. From there, we moved on to London, Paris, Japan, Milan and Spain.” said Shahnaz Husain, Chairperson and Managing Director, The Shahnaz Husain Group. Today, Shahnaz Group of Companies has over 400 franchise ventures worldwide.
With a buoyant economy over the last half-a-decade individual lifestyle has changed radically. Vivekanand, MD, Fitnessone India says, “After living in the US for 17 years and using health clubs regularly I found it a good opportunity to start a fitness centre in India. The gym and fitness sector is a sunrise industry and franchising allows us to expand more rapidly.” Fitnessone has a total of 75 centers across India, out of which 25 are owned or franchised health clubs and 50 are corporate fitness centres.
Evolve, one of the pioneering companies under the fitness sector, is a niche authentic health hub focusing on fitness solutions for different fitness needs and not merely a gym equipment facility provider. “There is lot of entrepreneurship talent available in India and franchising provides a good opportunity for growth to both, franchisor and franchisee.” says Manoj Shah, CEO, Evolve, Foothills Wellness Systems. Also commenting on franchising, Sandeep Ahuja, MD, VLCC, says, “We entered the franchising route three years ago and currently we have 40 franchisees of VLCC centres and 17 franchisees of VLCC institutes across India, essentially in Tier II cities. Beyond a certain site, franchising mode eases the ability to extend our reach at a partner way.”
Growing consumerism, healthy spending power along with changing lifestyle has lead to over consumption and a sedentary lifestyle resulting in diminishing quality of our lives. “Franchising model helps the company to scale up operations, penetrate faster, manage investments better and leverage local strengths of franchisee partners. This helps growth and profitability. Currently we have 40 labs, 700 centres in India and outside, we have collection centres in Nepal, Srilanka, Bangladesh and Kuwait.” says O.P.Manchanda, CEO, Dr Lal Pathlabs. Toeing Manchanda’s line, Parichay Upadhyay, MD, New Look Laser Clinic, says, “Since we have all the expertise and technical know-how related to this field, surely we have strategically decided to expand through the franchise way.” NLLC, Asia’s largest skin laser centre and a leader in this segment for the last 12 years, provides end-to-end solution to all sorts of skin problems through the latest and upgraded technology. Today, they have more than 17 successful clinics pan India.
Dr Madhav Sane, the pioneer of Sanecare, who opened his business from a small clinic in Ghatkopar, Mumbai, treating over 150 patients a day with his herbal formulations and some health regimes, has started franchising with the view of standardized treatment at different locations.
Offering training and support:
Since franchisors give training and support to their franchisees, franchising business is considered safer than running an independent business. Shahnaz Husain provides a pillar of support to franchisees in terms of R&D as well as in launch of innovative products and specialised treatments. “We also assist our franchisees in site selection, project management, layout and interiors, marketing and all standard operating procedures, equipment sourcing, trouble shooting tips, product planning,” added Shahnaz.
On training and support to franchisees, Vivekanand says, “We have the Academy of Fitness Management in Chennai, where we provide initial and ongoing training in front-desk management, sales, marketing, fitness trainer’s certification, physiotherapy and nutrition.”
Evolve trains its franchisees in all the aspects of club management starting from inquiry management, customer management, infrastructure management and technical support. “We provide HR assistance in recruiting, hiring, and staffing people. We have a strong process architecture and automation in place that reduces the burden of execution from the franchisee’s end,” says Shah. He added that the entire franchisee team is provided rigorous training for four weeks initially and then 100 hours of continuous training every year. “We also have a module called “We Run You Earn”, a franchisee-owned, Evolve-managed model. Here, the franchisee invests in the business but Evolve manages the business on their behalf,” adds Shah.
“NLLC imparts extensive training to its franchisees, which includes product knowledge, operation knowledge, technical know-how, data base management, revenue generation and marketing and advertisement strategies as per the city to be adopted,” says Upadhyay.
“We provide all possible professional and technical support to our business partners, as, their growth is directly related to us. We believe in the power of two-way communication hence, the process of integrating with our franchisees becomes smooth sailing,” says R. H. Choudhary, Director and Head, Business Development, Orb Health Sanctuary. Health Sanctuary supports their franchisees in site selection, project management, staff recruitment, staff training, centre launch, equipments, marketing support and quality control.
Likewise, Kudos Ayurveda provides pre-opening training to the franchisees. “A confidential operations manual detailing day-to-day operations is provided for easy reference to replicate our success in your business,” says Karan Goomar, Marketing Director, Kudos Ayurveda. The medical formulas at Kudos Laboratories, a healthcare unit with over 100 years of experience in the science of Ayurveda and herbal treatment, are an inherited legacy of the forefathers who were pioneers of Ayurvedic knowledge and practices.
Dr Lal Pathlabs also extends training to its franchisees, which constitutes training on specialised tests, soft skills and doctor sales closing techniques. “We have a dedicated training department that undertakes these programmes for our franchisee partners,” says Manchanda. Dr Lal Pathlabs also provides marketing support to its franchisee partners in terms of launch and post launch support, branding of the outlet, help in holding camps and also training the franchisee partners’ sales staff and providing him all the marketing know-how.
Future – very promising
On his company’s future plans Upadhyay says, “Looking at the huge potential in India, we plan to reach to a level of 40 centres by 2011 for which we shall be open to franchising. Anybody who is aware and conscious of his or her wellness in terms of appearance and between the age group 10 to 50 years is our target group. In fact, with males also becoming concerned about the way they look, 35 per cent of our customers are male.”
“We will be extending our ventures on franchise system and are looking at all major cities and towns in India,” says Shahnaz. “We have recently opened a Shahnaz Husain Store and Salon at Select Citywalk Mall in Saket, New Delhi, and intend to open more such salons in malls,” she added.
Evolve is looking at 40 new centres in the next 2 to 3 years. “Our target markets would be mainly Tier I and Tier II cities, like Mumbai, Delhi, Mangaluru, Chennai, Kolkata, Hyderabad, Ahmedabad, Surat, Baroda, Nagpur, Nasik, Aurangabad, Chandigarh, Coimbatore and other upcoming and maturing markets,” said Shah.
While Fitnessone is planning to open 10 new outlets within a year, Sanecare is targeting on Vidarbha, Karnataka, Madhya Pradesh and Gujarat. “Our company has aggressive plans in terms of scaling up network through franchising and other M&A formats. We plan to roll out 20 more labs in FY 10.” says Manchanda. Kudos Ayurveda is targeting to open 500 clinics by March 2011. “As we are already present in Tier I cities, so, we are trying to expand our geographic footprints in Tier II and III cities,” says Ahuja.
Health Sanctuary is targeting Tier I and II cities through 50 centres pan India by the end of 2010. Chaudhary of Health Sanctuary says, “We expect to have a tally of 12 centres in Delhi and NCR so as to cover all the areas and provide our services within a reasonable reach of everyone. With most of Delhi already having been covered with running-in pipeline centres, opening for centres at Noida and East Delhi remain. We expect to reach the targeted 12 centres in Delhi and NCR within the next 6 to 8 months. Simultaneous expansion in other cities is already under progress.”
The health and beauty-care sector is moving ahead at the same rate without being affected by the economic slowdown. Its low-level risk provides new opportunities giving encouragement to desiring businessmen who may be afraid to invest their money in today’s slugging economy.