Huge strength of brands from international market is penetrating into Indian market with easy flow, thanks to franchise mode of business expansion. Study by KPMG, ‘Collaborating for Growth’ on the industry, suggests that foreign brands are finding franchise route prolific to make their foothold strong in India.
Sectors such as food and beverages, education, fashion and tourism are at the centre of growth witnessed in India through franchising. Previous reports by KPMG too mentioned that businesses expanding through franchising will generate revenue in quadruple by 2017.
However, recent development made by Indian government on FDI regulation in multi-brand retail format that allows foreign retails to enter Indian market with company-owned stores could simmer down the predicted enthusiasm in franchising industry.
Nevertheless, the reports claim that franchising remains an efficient mode for brands to serve to the customers exuberantly especially in tier 2 and 3 cities.
Currently, India is home to more than 3, 000 brands that are extending its reach through franchise partners.
Some leading foreign businesses that are witnessing successive growth through Indian customers are KFC, Mc Donald’s, subway, Bata ( first franchisor to lead in India), Archies etc.
Home brands are too in the leading race of expansion in foreign land via franchise route. Brands such as Saravana Bhavan in food services in the US, Canada, Singapore, West Asia, United Kingdom, China; Gitanjali in jewellery retail in the US, Japan, Dubai and VLCC in health and wellness in the UK, West Asia, Singapore and Malaysia