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Franchising Funda

India 's Rs 73,000 crore (Rs 730 billion) Education business offers huge business opportunities. Not only it is recession-proof and growing at an amazing 13% annually, but demand also continues to outstrip supply.

Franchising in the Education segment is common all over the world, so why not in India? According to the Confederation of India Industry (CII), 17% of world business is through franchising; while in India it is less than 3%.

Franchising models-

In the early days, franchisees would ask us, 'Will you treat us the same? Will you do for us that you do for your centers?' Today we have pretty much gotten over that and there is much better understanding of complexities of the processes that go into running instition, and why we insist on what we do.

The business model what we follow has been derived from our collective experience of handling important portfolios in the top corporates of the country and also after running Centers for the last four years. We are sure that our business model can launch the business to profits in very quick time, without wasting too much of money in brand building.

What franchisees can expect from us-

A franchisee enjoys the best of two worlds. As the owner of an independent business, she is free to leverage her entrepreneurial capabilities and knowledge of the local market. She also knows that a nationally recognised brand minimizes her risks.

All the knowledge and expertise required to successfully run the business are ensured from us. Being part of a large network allows the franchisee to offer world-class service without spending a fortune.

We have been in the business for sufficient time, and have standardised systems and processes to such a degree that the franchisee doesn't have to waste time inventing the wheel. She can immediately get going on value-adding activities such as creating and driving the market rather than waste time designing an envelope or putting together a brochure.

At the project stage, we assist on:

Market study.

Site selection.

Architecture and interior design.

Selection and procurement of equipment.

Project coordination.

Manpower selection and training.

Information technology.

Marketing strategy.

Commissioning and pre-launch activities.

 

IT support is through a comprehensive Center management software solution.

After the center is launched, we help the franchisee upgrade his skills and those of his employees through continuous training programmes. For example, once selected, franchisees undergo a comprehensive training program to orient themselves to the needs of the segment.

Apart from the managerial support, we also support the franchisee by building the brand. It's a sustained marketing initiative both at the national and local levels with promotions, direct marketing activities and a comprehensive public relations exercise.

Center Management-

We typically need front office managers, Personnel Manager, Account staff, Business Development executives, Public Relation Officer and required house-keeping staffs.

The one person we definitely allow the franchisee to have is their finance person because we want them to feel that it is their project and we want to be very open and transparent. They feel more comfortable and we feel much happier that way.

We need the freedom to put in the right people to handle day-to-day operations, to administer quality in terms of people, materials and services and to have a certain kind of control on communication, in terms of the way the logo is used, the type of brand, advertising, etc.

Broadly speaking, there are a certain number of things that have to be done but how they are done varies from center to center. The mechanics really depend on the extent of promoter involvement, the level of senior management and the level of their support and assistance.

We think we succeed because all the people who work in our centers are not there only for a livelihood but also because they enjoy seeing people get better, enjoy working with the process of healing.

 

What we expect from a franchisee-

Franchisees must appreciate what we stand for in terms of quality care for the patient and if something is needed, we expect the franchisees to support us.

We need them to be with us on investment decisions and we definitely need them to be with us in HR policies because no center runs without people. Keeping people happy, motivated and constantly committed is a fairly complex thing.

Franchisees need to understand the elements of our HR policy and to give us the freedom to administer HR in that manner.

Service quality depends on the people in the organisation. It's critical that the franchisee understands this, has the ability to recruit the right people, can motivate them and invest in their training. We also warn franchisees that they should not be reluctant about standing behind the front office counter or opening the door for a sick old lady. They have to be as much a part of the team as anyone else. One can't talk good things and not do it.

Franchisees also need to have a certain amount of commitment to quality in terms of local materials purchasing. They have the option to plug in to our group purchasing system though it is not a compulsion. But they must listen to us in terms of specifications.

People often worry about quality when talking about franchising, but in the end everything boils down to the franchisee. If your franchisee is right, half the battle is won; and if she is not right, no amount of policing will help.

The ideal franchisee

Some franchisees, including institutions just want the brand. The starting point is, I am a running an institute, I can run the center, I can handle the processes but I want your name up there, it will help me push the breakeven point from year three or four to few months, let me be your partner.

The challenge is to make her change her mind. Capturing the value of the brand is not enough, the brand comes with a lot of quality initiatives.

Before we appoint a franchisee, we conduct a few checks. Obviously one is his ability to invest. The franchisee must look at healthcare and service quality the way we look at it.

The ideal franchisee is someone whose concern for quality is similar to ours, someone who expects good returns from the business but does not expect it tomorrow. She is a person who can create markets.

People orientation, the ability to drive and create markets, understanding service quality and an utmost conviction that Education is a business that is here to stay, if these four things are clear, we're in business. The lack of even one factor means a 'no'.

Facing competition-

In any growth sector, competition is bound to increase. Effective brand building and promotional activities in the area will quickly place the business. Then, to run this business profitably, we do not require mass. 20 to 30 students per month is what we are looking at the initial stage. Commitment to quality, consistent marketing efforts and brand value together will keep us above the competition.