Mbark Franchise Management


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Mbark Franchise Management

  1. 1. %MBArk Read on ................................... Franchise Management rapidly since then. Our membership of the World Franchising Council gives us access to Franchising Associations -Dhawal Shah of all the major countries. This helps to tap many global business Franchising is a business model of retailing, wherein the franchiser provides opportunities in this area, which in the brand name, business format and related training; while the franchisee turn enables us to provide superior puts in his capital for the retail outlet. Franchising, thus involves a contractual quality service to a growing relationship between the franchiser and franchisee, in which the latter pays a number of members that currently one-time license fee and typically an ongoing franchise fee, as an agreed include prominent companies like percentage of revenue generated by his outlet. Kodak, Lakme, Lever etc. . The Association's aim is to ranchising is a certain entrepreneurs. In the U.S almost spread knowledge on Franchising way of expanding 50% of retail trade takes place in India and the related best business because the through franchising as against a practices around the world. franchiser provides a meagre 2% in India. Towards this end, FAI has been tried and tested business conducting many workshops and What has your role been format along with the brand seminars in different parts of the in setting-up FAI? What inputs. The franchisee has a strong country. For more information on are the primary activities motivation to make the investment careers in franchising, you can visit of the association? work because of his share in the the association’s website at revenue. C Y Pal, President of The I have been associated with the Franchising Association of India Franchising Association of India and Chairman of Cadbury’s, since its birth in 2000 and have had What is needed to pursue shares his views on prospects in the privilege to see it a successful career in franchising and how an MBA can grow ent Franchising? help you to make a successful and Typically, a large Managem lucrative career in the field of How does franchise franchising. an MBA help in What is the potential of Franchising? Franchising in India? Franchising, by definition, is an entrepreneurial activity wherein Franchising as a business model a franchisee with the help of a brand, the business format provided has tremendous potential for Franchise to him and the related training in systems sets up a franchise outlet. growth in India because of the This necessarily requires expertise in all business related activity obvious boom in the retail and even if on a smaller scale i.e. Finance, Operations, People services sector, inspired by the Management, Logistics and other standard business activities. changing lifestyles and the An MBA provides all necessary training for holistic operation of a resultant rapid increase in business and is therefore in my view a very good qualification for an demanding customers - both for individual setting up an enterprise as a franchisee. products and services. The Besides becoming independent entrepreneurs and franchisees, Franchising model also fits in well MBAs also have tremendous potential to grow in the position of franchise with the inherent skilled manager in a company. enterpreneurial resources that The success of a franchisee depends largely on the manner in which have always existed in India. he or she is able to run his outlet. The growth and success of the business Franchising also has the potential also depends significantly on the overall competence and commitment of to create a huge number of jobs as the franchisee. While the commitment and investment angle has to be well as many successful ensured by the franchisee as an individual, an MBA qualification certainly contributes to the competence aspect of managing a franchise business.
  2. 2. %MBArk Read on ................................... manage a franchise company, which is conducting its outlet? franchising retail business through more than as an one business model, will have a While the franchisee needs to option? franchise manager to look after have the abilities of an overall that aspect of the business. He business manager, specialisation in Yes, many MBAs have should preferably have a marketing and/or finance will started looking at franchising, as marketing background, a good certainly help to succeed. As far as they perceive the tremendous knowledge of the market and clear operations are concerned, the growth potential the field offers. conceptual understanding of the franchisee would get sufficient What are the typical way franchising works. An MBA assistance from the franchiser to challenges that one would with a specialisation in marketing, learn the operational details of face in this field? and 8 – 10 years’ experience in business. However, when it comes marketing and sales is an ideal fit. to managing the franchise outlet, Well, there are several As far as the franchisee is it will be a big plus if one has a challenges. The first would relate concerned, the major knowledge, at least in principle, of to the drafting of a fair and proper requirements, in addition to a retailing, marketing and finance franchise agreement with a sound and good education management. franchiser, and choice of proper background, are business acumen business of a franchise venture. What are the current and strong entrepreneurship skills. You also have to absorb details of trends in Franchising? The person in this role should be the business model thoroughly and able to relate effectively with the Franchising as a business model assimilate the training inputs from franchiser on an ongoing basis in has become exceedingly franchisers effectively besides order to absorb all the inputs successful, particularly in service setting up the franchise outlet as related to the brand, best practices provision, with consumers per franchisers’ norms and and training needs. The becoming increasingly demanding standards. But the greatest relationship between the in the quality of service they challenge is perhaps that of franchiser and franchisee on an receive. Franchising as a concept generating higher sales by creating ongoing basis plays a very originated with manufacturing, as the right ambience. important role in ensuring success in the case of cola companies What has your personal of the business. setting up franchise units for experience been like? bottling. Of late, however, the Are there any typical growth in franchising is being The major challenges I have specialisations which primarily driven by the services faced in franchising related to would help an MBA to sector like IT education, childcare, manufacturing were in the area of successfully run grooming, beauty services, achieving the projected sales or hospitality, food and beverages, volume and managing its etc. relationship with production volumes committed to franchise Do a lot of MBAs units. A major area that requires look at continued focus of the franchiser is the profitability of the franchisee, because at the end of the day the franchiser – franchisee relationship becomes sustainable only if both are in a WIN-WIN situation. The author is a BMS student and is fascinated by Economics.