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Business Opportunity with Franchise India

January 6 2012

Roadmap
Franchising A tool to growth Global Scenario Franchising in India About Franchise India Channel Development Brief Business Associate Profile FIBL Roll-out plan Business Associate Revenue Model Revenue Lines & Payout FIBL Support Brand & Marketing support 360 degrees Training support

Franchising A tool to growth


About Franchising Global Franchising Scenario Franchising in India

About Franchising
Franchising is the practice of using another firm's successful business model. The word 'franchise' is of anglo -French derivation - from franc- meaning free. Technically, franchising means - the rights of privilege granted. For the franchisor, the franchise is an alternative to building chain stores to distribute goods and avoid investment and liability over a chain. The franchisor's success is the success of the franchisees. The franchisee is said to have a greater incentive than a direct employee because he or she has a direct stake in the business. Things that makes Franchising fantastic: Capital Raising Human Resource mobilization Brand Equity Training

Franchising as a tool to Growth


Key elements of franchising
Rights to a Name, System and Know-How Owner / Operation of outlets by franchisees Duplicating a Proven Business System Network Growth Ongoing Development of Brand
Market Focus

What is required ?
Invest in Systems Invest in Brand Maintain Standards Be sophisticated in business practices - Good record keeping - Good reporting and IT systems - Good compliance systems -Professional in dealings
Business model + Distribution strategy

People
Strategy

Customer Enabler

Employee Agency Broker Dealer Partnerships Cooperative Licenses Franchise Joint Venture

Franchising as a tool to growth


Franchising
A way of carrying on business Independent business owners to be part of a network Defined way to supply the goods or services

Structure
Single unit franchise Master franchise Area developer franchise Multi unit franchise

Competitive Advantage of Franchising


Independent business owner/operators A greater level of commitment and accountability than employees. Simplest way to raising funds (w/o parting ways with equity)

Franchising the Ultimate network


What do Coca Cola, Pepsi, Shell, BP, Mobile, Ford, General Motors, Toyota, McDonalds and KFC have in common? Franchising created the worlds biggest brands by: Sharing vision, ideas, knowledge and process Creating systems for franchisees to develop profitable businesses

In Australia 1000 franchisors and 65,000 franchisees together generating over $128 Billion in revenues 500,000 jobs 25% growth since 2000
In the United States Over 3,500 franchisors and 850,000 franchisees together generating over One Trillion Dollars in revenues 11 Million jobs 20% growth since 2000

Franchising in India: Emerging trends


Grown from a questionable and not so acceptable format to a readily admissible way of business expansion in the country The pioneering companies have shown franchising can work in any country

Brought a graphic change in over all working of the countrys business Technology & internet are helping at both ends:

to create the awareness about new product & services, and helping to serve the consumer better leading to fast proliferation of worthy concepts & products.

Snapshot: Industry growth


Franchising industry growing at the rate of 40% 200 Home Grown Franchisors & 2,50,000 Franchisees (growing entrepreneurship) 85% Success rate vis a vis 90% failure in self start up Industry of over US$ 4 Billion Highest retail outlet density in the world (Approx 12 million) Remains the best entry & expansion strategy Small format businesses are key economy drivers Employs over 10 Million employees directly / indirectly

Franchising in India: Emerging trends


Education - Size of Indias private education sector, including the coaching classes segment, is estimated US $ 40 billion Retail -Expected to grow up to US $ 785 billion by 2015 F&B - Growing at 25 percent to 35 percent every year. Young spenders with hectic schedules and rising incomes are creating new appetites Travel The growing Indian travel & tour industry likely to spawn US $ 128 billion by 2016 Luxury Goods - Market to touch US $ 14.72 billion by 2015 Franchising: Sectoral break up

Features of Indian Franchising Industry

Over 150,000 franchisees currently Only 10% of the businesses are franchised as compared to 70% in U.S. Over 1,500 franchisors at present

Current annual turnover estimated approx. US$ 16 billion


Total annual turnover by 2013 approx. US $ 20 billion Over 950,000people directly & indirectly employed by franchised business

Trends fostering in the new decade


1. Organized approach of franchising
Grown from a questionable and not so acceptable format to a readily admissible way of business expansion in the country Until now limited to the larger companies realizing the potential through the franchising way! However, the new decade would encourage smaller companies to follow the organized/technical way of opting franchising as a tool to growth

2. Implementation of best practices


Realizing franchise as the best entry & expansion strategy Small to medium format businesses will adopt the best practice/ international proven concepts to their business to achieve growth faster

3. Policy & Regulations


Currently, the industry is non regulated and doesnt bind the franchisors in any legal ways However, the scenario is expected to change soon with control & measure regulations binding the franchisor and the franchisee are likely to be announced

Expected key trends in the franchise; Primarily recognition as an industry would be the key !

About Franchise India

About Franchise India Group


Group revenue of over 10 Mn USD Completely debt free company Privately held company with complete equity ownership with promoters One of the top 10 Management Consulting companies in India Largest B2B Exhibitor in India with shows being held over 50 cities in India Largest Indian B2B Advertiser in leading English dailies. Largest network in service industry in India 95% of the total franchise fraternity refers to Franchise India before making a decision.

Franchise India
Consulting Events & Exhibitions Business Brokerage Media Property & Capital Services

Licensing

Franchise India
Franchise India (FI) is Asias largest integrated franchise solution company since 1999, and an absolute authority on franchising and licensing.

Consulting
1 3

Marketing

Transaction Platform

Franchise India Platform

Francorp - Oldest & most experienced franchise management consulting firm Bradford Licensing LLC - First 360 degrees license solution provider Fran Legal - Pioneers in providing franchise legal services

Knowledge Platform

single window for all Franchising Solutions

Franchise India Holdings Limited Media - The Franchising World, The Retailer Events & Exhibitions 65+ Franchising shows in a year Franchiseindia.com Most goggled website

Marketing Services

Franchise India Brands Limited Consulting Business Brokerage Capital Services & Property Services

Transactional Platform

Franchise India Ecosystem


Francorp Franchise India International

Fran Legal

Bradford License

Franchise India Ecosystem


Franchise India Brands

Franchise India Publications

www.franchiseindia.com

Franchise India Property

Franchise India Exhibitions

Franchise India Progression


Expanding portfolio

2002

2006

2008

2011

Franchise India Knowledge Based Platform


Francorp Bradford License FranLegal

Francorp

License India

FranLegal

Franchise India Holdings Limited


Media Events & Exhibitions www.franchiseindia.com

Franchise India Publications

The Franchising World - Indias


No. 1 Business Opportunity Magazine with circulation of 1,00,000 copies

The Retailer - Indias highest Selling Retail Opportunity Magazine with 60,000copies

Franchise India Publications

Franchise India Exhibitions

Franchise India Website (www.franchiseindia.com)

Franchise India Brands Limited

Franchise India Brands


Franchise India Brands Limited (FIBL), is the leading business brokerage group anchored in India. It provides the structure to develop, grow and expand a range of business models for a profitable and sustainable growth through partnering. With a Pan India network, strong and best of breed deal makers and over 600 valued partners, FIBL enjoys a governing presence in the Indian business brokerage space. FIBL is an absolute authority and Asias largest franchising solutions company that provides a single window in channel development to all product/service brands to expand their distribution strengths across geographies. And hence we are proud to articulate that No-One Sells More Businesses Than Us We have expertise in the following areas of business:

Franchise India International

Franchise India Property

Franchise India
Sector and Specialty Approach Service Lines

Strategy I Legal I Operations I Marketing I Sales I Training


Focused sector practices | Coordinated service lines | Specialty groups
Sector and specialty approach Apparel| Aviation training school | Pre school| Pharmaceuticals retail| Retail & Consumer products | Business school| Online MBA programs | Hospitality | Media & entertainment | Real estate & training | Telecommunications | Facility management| Soft skills training | Beauty & wellness | Jewelry | Home dcor & furnishings | Consumer services | Food & Beverages| Home based businesses | MLM businesses |

Franchise Indias Service lines Advisory Strategic planning Franchise feasibility Review & recommendation approach Franchise development model Legal Franchisor legal agreement Franchisee legal agreement (Master/ Area/ Unit) Marketing Development of Marketing communication for franchise sales Operations Operating procedures Sales & Training manuals.

Business Associate
Pan India Roll-out plan Business Associate Profile

Franchise India Indias Largest Business Broking house

Presence in 231+ cities across India 1.5 lakh+ Registered Investors 8 Zonal Offices Serviced 1100+ brands till date Break even in first year of operations

Effective, anytime-anywhere integrated business transaction capability

Business Associate Roll-out Plan


Channel Partner Locations (marked in red) FI Zonal Offices (marked in blue)

1. 2. 3. 4. 5. 6.

North Amritsar Ludhiana Jalandhar Jaipur Lucknow Nepal East Patna Bhubneshwar West Nasik Nagpur Raipur Indore Bhopal Surat Baroda Rajkot South Vizag Vijaywada Coimbatore Calicut Kochi Sri Lanka

1. 2.

North Chandigarh Delhi East Kolkata West Mumbai Pune South Bangalore Chennai Hyderabad

1.

1. 2.

1. 2.

1. 2. 3. 4. 5. 6. 7. 8.

1. 2. 3.

1. 2. 3. 4. 5. 6.

Business Associate Profile

Analytical Thinking

Attributes

Networking Skills

Marketing Skills

All the three combinations in any franchise owner is expected and given first preference to be a franchisee.

Profile on 5 Point Scale

Financial Strength 5 Passion for business(Sector)

4
3

Business Analysis Skills

Comfort level with Brand Owner

2 1

Professional Experience

0
Marketing Skills Ability to manage manpower

Educational Qualifications Networking Skills

Space and Location

Benchmark

Business Associate Profile


Chartered Accountants Business Consultants Management Consultants Law Firm owners Advertising Agencies Insurance /IFA Agents with strong networking Sub brokers of leading financial companies Leading Real Estate firms

Business Associate
Value Proposition What you get as a Partner

Value Proposition for Business Associates


Identify right set of investors Identify the business needs and provide them need based business solutions Investor relationship management Different products for different needs Leverage Franchise India eco system Transaction/Consulting and Media

Right Investor Acquisition

Multiple Product Sales

Differentiated Services Strategies


Cutting edge technology Centralized Back office Centralized Business Associate helpdesk Exclusive Key Account Manager's to support on ground Strong & experienced franchising research and robust training

Business Model

Business Associate Channel Partner Direct Sales Team

Support to Business Associates


A. Technology

Associate Portal: Our comprehensive CRM provides access to clients investment details, Area availability, industry reports and more in just a few clicks.
Cutting-edge technology: Our superior softwares and an excellent technological platform assures a seamless transaction experience geared to meet all the business buying needs of the investors. B. Industry/ Category Research Our teams closely monitor the market trends and hence release number of research reports on the growth of a particular industry and how your investors can benefit from it.

Support to Business Associates


C. Ongoing support Centralised Back office A dedicated team at our centralised back office in Head office provides seamless back office support.

Training and Development We offer extensive training facilities for all our Associates, which cover aspects like product information, systems acquaintance, operations and sales and compliance etc.
Exclusive Business Associate Helpdesk An exclusive Business Associate desk assists you in acquainting you with our processes, coordinate with various operational departments and solve all queries. Network With presence across 231+ cities and a network of 8 own branches; we are Indias 1st Business Brokerage house.

360 Degrees Support

START-UP TRAINING
3 days residential training on
Franchise Overview Franchise Sales Strategy & Lifecycle Management Franchise Development Process Certified Business Broker Training

LAUNCH PLAN
City specific launch plan
Business Associate Launch event Visibility support round the year PR support Dedicated FI team to work closely with you

SOFTWARE SUPPORT
Access to integrated CRN Robust online MIS tracking Reports at a click

360 Degrees Support

LISTED BRANDS
Access to all FI listed brands from Day 1
National International

MARKETING SUPPORT
Leads support for business generation Access to Franchise Retail Opportunity shows Access to Business Opportunity Shows* Reward & Recognition Platform

VALUE ADDED SERVICES


Access to
Property Services Capital Services Referral Fees

Reward structures on new brand acquisitions

Professional Consultancy on
Business Finalization Project Planning Project Execution

Support to Business Associates


Brand mileage Franchise India is one of most identified and trusted brands in India in the field of franchising One stop shop for all business solution to the Investors needs. Hand-holding to identify business potential and to develop the business in your local markets

Exclusive Relationship manager to support on ground.


Basic induction and training to Business Associates for operational knowledge. Special training programs on the industry & franchising and on evolving trends Technology that guarantees seamless connectivity at all times. Unique back office support. Appropriate presence in print and electronic media. Marketing support- Local area programs, All product brochures and Franchise India branding.

Business Associate
Set-up Cost Revenue Model Revenue Lines, Sharing & Basic Contract terms Payment Collections & Reconciliations Payouts

Set-up Cost & Revenue Structure - Citywise

ELEMENTS Signup Fees Service Tax (12.36%) Total Signup Fees

City A 105000 12,978 117,978

Revenue Structure

Revenue Lines, Sharing & Basic Contract Terms

Registration fee Success fee (On deal closure) Third Party Product (TPP) fee Phase II Consultancy fee on Taxation services Phase II

The initial contract will be for 3 years, renewal every year there on Profit sharing Pattern: On Investor Acquisition 30% On Investor Servicing: 20%

Payment Collections & Reconciliations


All collections against Registration, Investor Service fee or any other fee to be collected in either cheque, Draft or Pay-order favoring: Franchise India Brands Limited No other mode of payment allowed All payments to be deposited locally in informed FIBL bank account number Reconciliations to be done by HO with data from CRM

BA Payout
For revenue against Registration done to be released by 7th of next month for all payment collections reported by Finance for the period 1st of the month till month-end For revenue against Deal Closures in the same calendar period, payment to be released by 7th of next month No payment would be made on accrual basis

Key Legal Points


The Channel Partner will not be allowed to function with any other business from designated model Data secrecy has to be maintained through CRM and at all levels Payments are only supposed to be collected in form of Cheque, Draft or Pay-order or Internet transfer. No other mode would be allowed Legal rights of property to be clear Contract binding tenure initial for 3 years & every year there on

Thank You