FRANCHISING

Presented by;
Shrinidhi Amin - 01
Scarlet D’Souza - 09
Pooja Gupta - 16
Kirti Jaiswal - 20
Jai Juvekar - 21
Suraksha Singh - 51
(TYBBI)
 LEARNING OBJECTIVE

• Understand the principles of a franchise.

• Appreciate the advantages and disadvantages of

using franchises.
 INTRODUCTION
MEANING OF FRANCHISING:
Franchising is the practice of the right to use a firm's business
model and brand for a prescribed period of time. The word
"franchise" is of Anglo-French derivation-from franc, meaning
free.

SOME COMMON EXAMPLES OF FRANCHISING

WHAT IS A FRANCHISE?
A franchise is an arrangement in which an established
business name is sold to an individual or company,
who can then start trading under that name.
 PARTIES INVOLVED IN
FRANCHISING
• FRANCHISOR : A franchisor is a person or company that grants
the license to a third party for the conducting of a business under
the franchisor's marks.

• FRANCHISEE : A person or entity to whom the right to conduct a

business is granted by the franchisor or licensor.
WHAT EXACTLY IS FRANCHISING.
TYPES OF FRANCHISES
• Product Distribution Franchise.
A product distribution franchise model is similar to supplier-dealer
relationship, however, the franchisee is required to observe a few
guidelines e.g. agreeing to sell only the franchisor’s brand
exclusively.

• Business Format Franchise.

In a business format franchise, the business integration is more
complete. The franchisee distributes the franchisor’s products and
services under the franchisor’s trade mark, as well as implements the
franchisor’s format and procedure of conducting the business.
• Manufacturing Franchise.
It is a form of service agreement whereby the franchisee provides
the management expertise, format and/or procedure for conducting
the business.

TO BE MORE PRECISED:-
Business format franchise. Product franchise

Manufacturing franchise
IMPORTANCE OF FRANCHISING.
• Leveraging on a recognized brand name.
• Enhancing business image.
• Ensuring consistent quality.
• Attaining higher productivity/better motivated
staff.
• Access to good locations.
• Economies of scale.
• Reduces risk of failure.
PROS AND CONS TO FRANCHISEE
PROS
• Working on a well-
established business.
• Lower failure rate.
• Buying Power.
• Simpler business financing.
• No previous experience
needed.
• Star Power.
• Profits.
CONS
• Loosing of control.
• Time-consuming process.
• Already decided procedures
and norms.
• Costs.
• Terms of agreement.
• Risk of reputation.
 PROS AND CONS TO
FRANCHISOR
PROS
• Business expansion.
• Buying power.
• Operational convenience.
• Franchisee’s contribution.
• Motivation and cooperation.
CONS
• Lack of freedom.
• Franchisee’s financial
situation.
• Franchisee recruitment.
• Selection and retention.
• Communication.
 FRANCHISING IN INDIA.
• India is a vast country with a population of more than one billion
people . With changing lifestyles, growing income levels,
demanding customers and the advent of modern retailing the
franchise market is growing rapidly.

• Another important factor that is promoting the growth of

franchising is the huge entrepreneurial energy and skills that are
available in the country, wherein more than 50 percent of the
population is less than 25 years in age and more demanding of
improvement in the quality of their lives.
• There are already more than 600 franchising systems operating in
the country with a large number of foreign and particularly
American brands that include McDonald’s, Pizza Hut, UPS,
Medicine Shoppe, Kodak, Gold’s Gym and KFC etc.
CASE STUDY.
• Patanjali is the fastest growing FMCG company in India. Ramdev
established the Patanjali Ayurved Limited in 2006 along with
Acharya Balkrishna with the objective of establishing science of
Ayurveda in accordance and coordination with the latest
technology and ancient wisdom.

• Patanjali Ayurved sells through nearly 4,700 retail outlets as of

May 2016.Patanjali also sells its products online and is planning to
open outlets at railway stations and airports.Patanjali Ayurveda has
tied up with Pittie Group and Kishore Biyani's Future Group on 9
October 2015.

• Patanjali Ayurved has also started its FMCG expansion in form of

dealership and distributorship channels across the country and
expects wider growth in Overseas distribution as well.
 A SMALL INTERVIEW.
NAME OF THE FRANCHISE: HARSH TRADERS.
FRANCHISE AND DISTRIBUTOR OF PATANJALI AYURVED.
QUESTIONS
Q1. How many hours do you spend on your business?
Ans- 12 hours.

Q2. How much was your investment? Have you recovered it?
Ans- Investment was of Rs12 lakhs approx and is been recovered.

Q3. Which is the most selling product you have come across till date?
Ans- Ghee , Tooth paste , Honey , Biscuits , Medicines.
Q4. Are there any un-expected costs involved in the business?
Ans- NO un-expected cost.

Q5. What do you think about the marketing and advertising?

Ans- Marketing skills is improving day by day as it is coming up with
new strategies and advertising is really pleasing and different from
others.

Q6. Are there any restrictions on the products you sell or use in your
business?
Ans- We are not allowed to sell other company’s products as a
franchise but as a distributor or retailer it can be done by proper
permission.
Q7. If you had to do all over again would you choose the business or
franchise of the same company?
Ans- Will definitely go in for the same company as it is fast growing
and is going to be global soon.

Q8. What are the other products that patanjali would like to bring.
Any idea?
Ans- Patanjali has recently come up with herbal cigarettes by tying up
with Maan’s ayurvedic and is soon going to introduce its own
clothing brand solely.
THE INTERVIEWED FRANCHISEE AND HIS WORK PLACE.
THANKYOU
