Frequently Asked Questions -Franchising


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Frequently Asked Questions -Franchising

  1. 1. Frequently Asked Questions<br />Q1. Should we look at doing business in “Education as a sector “ ?<br />“India’s education and training sector offers private institutions an estimated US$40 billion market, with a potential 16% five-year CAGR,” says a report by CLSA Asia-Pacific Markets. According to another report - by IDFC-SSKI - India’s current spend on education is at 5% of average household income with a CAGR of 8.6% versus consumption growth of 3.2% over 1995-2005. <br />Why Education ???<br />1. High rates of return- EBIT ranges from a low 15% to over 40%<br />2. Favourable pricing<br />3. Scalability -Insufficient supply offer opportunities of growth<br />4. Revenue Predictability - No of students registered every month will form a base for  revenue for the coming months.<br />5. Negative working capital -Student fees is collected annually or in advance whereas expenses are incurred over a period of time<br />6. Counter Cyclicality -Enrollment in vocational training education increases when economy worsens<br />Q2. Is taking up education Franchise good for me? Would I have a profitable franchise venture ? Which franchise is the most lucrative option for me ? <br />If you like the idea of being self employed yet entering the marketplace with an already established business then a franchise might be a good opportunity for you. If you love education field, interacting with young students of age 17+, have a passion to take lectures, understand the meaning of Quality education &  delivery- then i360 , No. 1 franchise opportunity waits for you. <br />However, there is a lot to learn about franchises before taking a leap into this entrepreneurial world. Your previous business experience, amount of investment, and personal preferences will play a huge role in whether or not you are suited for a franchise. Plus, you will need to have a franchise idea to help you get started.<br />All franchises have the possibility of being lucrative and they all have the possibility of failing. Most of the time the making or breaking of a franchise is the franchise owner and his ability to overcome problems that present themselves not to mention staying dedicated to the franchisor at all times. There are three basic types of franchises, including wholesale distribution, products, and services. The type of franchise you should pick is not the one that has the supposed possibility of making you the most money because this simply won’t work. The most lucrative franchise for anyone is the one they find enjoyable and don’t mind dedicating all their free time to making a success.<br />Q3. What Franchise Idea is Best for You?<br />Now that you have evaluated your liquidity, total investment, and personal business experience you are that much closer to finding the right franchise idea. Remember, however, that while having the financing and experience down there is still one very important element. What’s left you might be wondering? The answer is personal interest. If you are not personally interested in selling training’s and making the general public want to get trained more  and more then you are going to have a tough time making your education franchise a success. So, when considering franchise ideas keep these three key points in mind, investment, experience, and personal interest, to make sure you find the best franchise for you.<br />Q4. Should I take single product franchise or multi-product franchise?Specialized Product Approach Vs Generalized Product Portfolio <br />i360 has a full fledged product bouquet to counter any business risks /any territory issues/ business cycle<br />In Non-metros specially Generalists are more successful that Specialists, as they lack basic education services which are more prevalent in metros<br />Q5. How is i360 comparable to other players in the same space?<br /><ul><li>i360 has a comprehensive product at competitive pricing
  2. 2. Retail Product + Corporate+ Institutional package gives complete solution to the business partner at a competitive cost ?</li></ul>Q5. What makes the business successful? <br /><ul><li>Working very hard on the ground by BP, handling business pressure
  3. 3. Having a selling & service attitude- franchisor gives business blueprint not customers
  4. 4. Team player – managing relationship with franchisor, employees, customer, schools, colleges & Corporate</li></ul>Q6. Why Corporate & Institutional sales given by i360 & Not by other ?<br /><ul><li>Gives opportunity for business partner to connect with them locally
  5. 5. Programmed “how to approach”, “canned presentations “ and “pricing models” from i360
  6. 6. Makes business better with different avenues to earn </li></ul>Q7. Do you think “Recruitment of faculty” is not an issue with i360 ?<br />Staff Selection & management is the task of the franchise and is also one of the challenge when starting a new business<br />Ozone, recruitment arm of i360 has access to data banks which can be leverage by Business partner<br />Franchise would always have a challenge of getting work done from the team. Effective team management would ensure loyal & confident team. <br />Q8. How i360 has positioned themselves in the vocational training space?<br />i360 is a young organization vs older counter parts<br />We are agile, aggressive, process oriented<br />Have CRM and ERP as guiding principles<br />Strong Backend operations team <br />Franchise Support process<br />Audit procedures<br />Faculty/Student operations<br />R&D /Course Creation/Revamp/Product re-packaging<br />Marketing to conceptualize various promotions<br />Q9. What is the ideal franchise fee I should pay ? <br />The franchise fee usually covers the cost of training, support and site selection. The items or benefits that are included in a franchise fee are different for every company. It would have two components : Fixed (Franchise Fee), Royalty (Variable paid on monthly revenue)<br />i360 franchise fee is very competitive. You may combine the fees of all courses available thru competition Vs Ours<br />Our motto is “ More for less”<br />Q10. I am planning to buy an existing franchise. Which provides a better return on investment? <br />There is little evidence to suggest that buying an existing store will generate a better return on investment than a new outlet. <br />Existing outlet: This may appear lower risk as it is an already established business with existing performance indicators and regular clientele. However, even a site that has been profitable is not a guaranteed success for future owners – this is dependent on the hard work and attention of the owner. <br />New outlet: Although it may appear higher risk and will require a lot more work up-front to raise the profile of the business, there are benefits. A new site is a clean slate and owners won’t have any hangovers from the previous owner’s choices, mistakes or reputation. <br />Q11. What are the Qualifications for owning i360 Franchise ?<br />Cash liquidity requirement: Rs 3 lakhs – Rs 5 Lakhs (excluding Capex)<br />Business Experience: Industry experience or General business experience, Marketing skills<br />Operations – Absentee ownership of franchise is NOT allowed.<br />Royalty- 25% , Agreement Period -3 years<br />Training & Support – TTT for your new hires at HO or State centre, Marketing strategies, Sales Promotion Programs, Creatives for promotions, Meetings, Operation support processes, Certification, Indent Policy, <br />Q12.  Why education franchise? What is the scope of Vocational Training ? What type of programs are available from i360 ?<br />•        A booming young population <br />•        Demand for quality education<br />Spends on private education to increase to $80bn by 2012E:<br />•        Non-formal segments are fast-growing areas of the education landscape - 18% CAGR expected against 13% CAGR for the formal education space.<br />•        The $50bn education market, estimated to expand to $80bn by 2012<br /> This reinforces the scope of vocational trainings like Call centre training, Retail Sales, Service and operations training, Accounts and Financial training- Insurance, Mutual Fund and Stock Broking. To complement these Job oriented program are English Speaking, IELTS and Personality Development Programs.<br />Q13. When someone starts a franchise, it is a small business idea transforming into reality. He works with a Franchisor to seek guidelines and support to shorten hislearning experience. What are the Roles of Franchisor and franchisee ?<br />Franchisor -R&D, Alliances, Content Aggregation, Industry Vetted Curriculum ,Assessments, Industry Project Workflows, IT Enabling, ERPs, Certification, Sales Operations, Branding<br />Franchise - Responsible for the functioning of the center <br />−        Staff Recruitment<br />−        Center/Sales Operations<br />−        Go to market initiatives<br />−        Infra<br />•        Local Area Marketing<br />•        Local Placement Initiatives<br />Q14. What are the top reasons of franchise failing? <br /> Business Planning<br />No spend account for done -local area marketing <br />Waits for franchisor to work on ground<br />Business ownership disputes<br />Operational costs not accounted for while buying franchise<br />Low accountability/Interest in some other business in some other business<br />Serving personal goals/Family issues<br />Staff & Centre Management<br />Leaving setup to be run by Centre teams<br />No Staff, owner runs everywhere<br />Trainers/Staff not retained<br />Center operations in Chaos<br />Centre management outsourced <br />Very strict/insulting//abusive with Staff<br />Pays low salary/Un-hygienic work environment<br />No Marketing Understanding<br />No Alliances with Students, Institutes<br />No plan to student acquisition marketing programs<br />Visibility of centre is not there <br />Franchisor warning/directions have no impact<br />Q15. Don't assume a franchise is an easy, risk-free option – A Comment.<br />You'll be running your own business with all the responsibility and hard work that running a business entails.“<br />Following franchisor guidelines can make you successful<br />Follow startup, operational, academic procedures<br />Staff recruitment & training guidelines<br /> Local area marketing is a role of franchise<br />Working hard on ground <br />Alliances with corporate, institutes & Schools for students acquisition<br />For more details call us at 9311069401/419,<br />