Franchise Business: Safe & Profitable Ideas After Un-Lockdown

Which franchise business ideas would do well after un-lockdown? Also, which franchise business ideas will enable a franchisee to earn money after un-lockdown? Moreover, the most important question is, how to identify the best franchise business ideas after un-lockdown? In this blog, we will understand the answers to these questions.

Franchise Business Ideas

In a previous blog, I informed how the country’s economy has slowed due to coronavirus and lockdown and also how it will affect the customers. Furthermore, I also informed that what will be the impact of the slowdown on the economy and the customers? In addition to this, I also shared strategies that a business-person should use in such a time? If you have not read that blog, then here is the link

It is essential to know the answers to the questions mentioned above. Firstly because even after un-lockdown, the situation will not change anytime soon. Secondly, whoever starts a new business in the coming days and months will have to struggle with a similar situation. 

Table of Contents

Impact of Lockdown on Purchasing Power of People

We know for a fact that the lockdown caused by the coronavirus has affected the income of the people. Some people have lost their entire income, some people have found themselves with reduced income and some people in future might not earn as much as they are doing now. This has resulted less money in the hands of the customer in today’s time. As a consequence of the reduced earning capacity of the people, their purchasing power has also reduced. Hence, the most crucial question is whether anybody should start a franchise business at such a time? The answer to the question could be yes, if that franchise business gives decent profit and, on the other hand, ensures there is minimal risk of loss in it. In short, it should be a safe franchise business.

So at such a difficult time, if someone wants to start a new franchise business, then

What are those franchise business ideas, and how should they be found? 

To find the answer to the above question, we should see our franchise business ideas by keeping in mind the following two scenarios.

 Firstly, we have to see which businesses were doing well at the time of lockdown and which businesses will do well after un-lockdown? At this time, those business that were doing well at the time of lockdown are safe businesses to consider. Simultaneously, we should also find those businesses that will re-start after the un-lockdown and have good footfall, even in such a situation. 

Hence the answer to the question ‘how to identify safe franchise business?’ is by identifying those  businesses which 

a) have done good business at the time of lockdown.

b) with those brands which will do good business after un-lockdown.

c) by identifying the brands among the businesses which did well after lockdown and un-lockdown.

For these reasons an individual can associate with those brands by taking their franchise.

It would be prudent to do so because the franchise business, which did well during the lockdown, would have some inherited advantages. Similarly, the franchise business that will do well after un-lockdown will have some benefits too.

Therefore, it would be better to associate with those brands and take advantage of their strengths and best practices.

So, now we know the essential criteria to assess a safe and profitable franchise business. Hence, In this blog, we will discuss the top four franchise Business categories, which are more reliable and profitable to work with after un-lockdown.


So the first category among the top four franchise Business categories to consider after un-lockdown is

Franchise Business Opportunity Within Courier Industry

The franchise business opportunity with a Courier brand is one of the favorite franchise business ideas of the people.

The actual term for the Courier industry is C.E.P. Industry, which means Courier, Express, Parcel industry. This industry came into existence because traditional postal companies such as India Post failed to provide faster services to its customers. Also, companies like India post at one point in time were unable to cope with changing customer requirements.

After liberalisation in 19-91, as the Indian economy started growing and became an integral part of the international market, the growth in the courier industry’s begun accelerating.

If you understand hindi then you can watch my video on courier franchise

Courier Franchise Business

Today, the Indian C.E.P. industry is 18 to 20 thousand crores, growing at an annual growth rate of 17%. 

Importantly, we can divide the courier business into three segments.

First is B2B, i.e., Business to Business – 65% of courier business

Second is B2C, i.e., business to customer – 25% of courier business

The third is C2C, i.e., customer to customer – 10% is of courier market.

Franchisees of a courier business mostly get to work in B2C, i.e., business to customer, and C2C, i.e., customer to customer. And if an individual is interested in working with B2B, i.e., Business to Business segment, that individual needs to start its courier brand.

Advantages of Courier franchise business

Low investment cost in Courier franchise business

A courier franchise business is cheaper than many other franchise businesses; typically, a courier franchise starts in INR 2–4 lakhs, barring some exceptions.

Courier franchise business benefiting from E-commerce:

The e-commerce industry has significantly expanded in the last few years. As a result, it has also contributed a lot to the growth of the courier industry. 

According to a report by Goldman Sachs, India’s e-commerce market will increase to $ 100 billion next year, which will further expand the courier industry. E-commerce has helped the courier industry a lot. As the e-commerce business grows in India, so will the courier business will also increase. It is a known fact that Amazon and Flipkart have their courier and logistics firms. Hence if somebody feels that the growth in these e-commerce brands will not benefit the other courier companies, then such people can take solace from the two significant developments. First, many product vendors of Amazon and Flipkart are in places where these companies do not have their service. Hence, such vendors have to depend on other courier brands to deliver their products. It is expected that in the future, the number of such vendors will only increase.

The second point is that some big names have a plan to enter the e-commerce segment shortly. Hence these new companies will depend on existing courier companies to deliver their products.

The dependency of Retail Brands on Courier Companies for Delivery:

The third advantage for the courier companies is that, after the coronavirus, many retail sector companies are promoting their online model aggressively. The push for the online business comes, on realizing people’s reluctance to get out of their house and to encourage social distancing. The courier companies will benefit from this push by retail companies.

Things to keep in mind while starting the Courier Franchise Business.

Courier company should be reliable in systems and processes:

A courier company should have an online system or an app so that the customer can track their package’s delivery date. The customers should have an idea of the delivery date so that he can ensure that there is someone to take the package, or they could give instructions to whom to deliver in the neighborhood. If the package is delivered before time or late, then, in either case, the concerned customer should get intimated about it.

Maximum pin code delivery:

A courier franchisee earns not only by delivering parcel but also by booking parcel. So it becomes essential that while taking a courier company’s franchise is, that company should be able to provide delivery at the maximum pin codes. Thus, resulting in easy bookings of the parcels.

Go to institutions for a tie-up for the courier pick up:

Taking a franchise of a courier company does not mean that it is only about booking or delivering a courier. A franchisee should also do business development in it’s assigned territory. Like, tie up for courier-pickup with institutions or businesses that regularly send couriers within its designated area.

So, when kept in mind before taking a courier franchise, these points help a lot.

Point of concern for courier franchise business

Now one point which may be of little concern for the courier industry is the competition from India post. This P.S.U. is no longer the same old India post as it has also changed with time. Many e-commerce companies also have a tied-up with it. India Post has 1.5 lakh branches, which are mostly in rural areas. And it can be assumed that India’s post can give stiff competition to private courier companies in the coming time.

This was the analysis of the courier franchise business. Next Franchise Business Idea after un-lockdown is 

Franchise Business of Multi-Brand Automobile Repair Workshop

The franchise Business of a multi-brand automobile repair workshop is one of the business ideas of modern times.

When we talk about the franchise business of any automobile repair workshop, the first thing that comes to mind is the authorized service centers of automobile manufacturers. Though the authorized service centers are an option, the franchise model we are discussing here is the multi-brand automobile repair workshop every passing day. The multi-brand automobile repair workshop is gaining in popularity with every passing day.

We know that in the authorized service centers, vehicles manufactured by the authorizing company only gets repaired. Whereas in the multi-brand service outlet, the vehicle of every brand gets repaired. It should be noted that two-wheelers and four-wheelers franchise opportunities are separate in the multi-brand automobile repair workshop. 

Advantages of the franchise business with a multi-brand automobile repair workshop

Ever-Expanding Automobile Market:

The auto servicing and repair market is worth about INR 33000-37000 crores. Due to ever-increasing sales in the automobile sector, business opportunities with multi-brand automobile repair workshops are a great option. 

If somebody has the question in mind that due to lockdown automobile sales are down, will it impact business prospects? then the answer is in two folds

  1. Drop is sale due to unforeseen circumstances is usually a temporary phase. Sales pick-up once those circumstances are over. Similarly, people who need and afford will start purchasing vehicles once this crisis is over, and we have already started seeing a positive trend.
  2. There may be some people who cannot afford a new vehicle due to loss in income in present circumstances. This would mean that they would then carry on with their existing vehicle, requiring higher servicing and repair.

Customer Preference For Repairing Outside Authorized Service Centers

The automobile industry has a particular trend that after the warranty is over, 65% of the vehicle owners do not go to the authorized service stations. Hence the franchise of a multi-brand automobile repair workshop has a perfect opportunity.

A one-Stop shop for repairing all the automobile brands:

A one-Stop shop for fixing all the automobile brands is one of the significant advantages of a multi-brand automobile repair workshop. It does not matter if the four-wheeler is from Maruti, Hyundai, Tata, or another manufacturer. Similarly, it does not matter if the two-wheeler is from Hero, Honda, Bajaj, or another manufacturer. All the vehicles get repaired in one place. This advantage enables more customers to drive-in, thus resulting in a large customer base.

Quality service by skilled and trained technicians:

A multi-brand automobile repair workshop has a qualified and trained workforce. As a result, the customer gets excellent service, and a satisfied customer does the positive word of mouth publicity.

Availability of quality spares:

When someone gets their vehicle repaired at a local garage, they are circumspect about the quality of the spare parts used. While quality spare parts are available in a multi-brand automobile repair workshop, the customer has no stress of poor quality spare parts gets used. As a result, they would prefer to get their car repaired in a branded service center instead of a local garage.

Better work than local garages and cheaper work than authorized service centers:

In a multi-brand automobile repair workshop, repair quality is better than that of a local garage. Simultaneously the cost is lower than the authorized service center. Hence a customer gets quality work at a lower price.

Things to remember before considering the franchise business of multi-brand automobile repair workshop

  • First, fix the budget because here, franchise opportunities start from a few lacs and go up to 1.5 crores.
  • Second, what services get offered to the client other than repairing? It is essential to understand if a franchisor provides additional services like cashless insurance, onsite repair, and vehicle towing.
  • The third thing to note is what is the franchise model. Is it COFO? i.e., company-owned franchisee operated model or FOFO, i.e., franchisee-owned franchisee operated. If anybody requires more information on COCO and COFO, then the following blog could be read. This clarity is needed because if somebody is interested in the COFO model. Then for them, FOFO models become irrelevant, and if somebody is interested in FOFO, then the COFO model becomes irrelevant.

This was the analysis of the Multi-Brand Automobile repair center franchise business. Next Franchise Business Idea after un-lockdown is 

Franchise Business of Pharmacy

The pharmacy franchise business is among one of the evergreen franchise business ideas.

 In 2019, India’s Pharma sector was worth $ 21 billion, converted in Indian rupees; it is little more than one and a half lakh crores. This huge turnover is possible because of achievements like 

  • India is the largest supplier of generic drugs worldwide. 
  • The Indian pharmaceutical industry caters to more than 50 percent of the demand for various vaccines worldwide. 
  • In the U.S.A, Indian Pharma companies hold 40 percent market share for generic medicine.
  • The Indian pharmaceutical industry caters to 25 percent of all the requirements of drugs in the U.K. 

Advantage of Pharma franchise business

Future Is Bright: 

An estimate says that people in India will spend 9-12 percent more on medicines in the next five years, thus ranking among the top 10 countries spending maximum on drugs.

Thus we will see more growth in the business.

Pharmacy Franchise Business comes under essential commodities:

The pharmacy business comes under the essential commodities, so it operates under all the circumstances. Hence there is no disruption of business and income.

Franchisor Guidance:

A franchisee gets guidance from the franchisor While getting a Pharmacy license; hence the task becomes a little easier. Additionally, the franchisor gives the product training and guides about the kind of medicines that need to be stocked and how much should be the stock. Hence it is an excellent option for those who do not have any experience in the Pharmacy sector.

Before taking a Pharmacy franchise business, it is essential to pay attention to a few things like

  • What will happen to the stock that remains?
  • Are generic medicines also sold?
  • What other products get sold other than medicines? As in the early phase, non medicine products are very helpful in bringing customer footfall.

Three significant risks that the pharmacy sector is facing in current times.

  1. According to a report, affordable medicines under the Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP) have saved people Rs 1,000 crore (the U.S. $ 143.08 million) in the financial year 2019. The business model of the PMBJP is in direct conflict with the business model of the pharmacy sector.
  2. Generic medicines: Generic medicine stores are opening very fast, which is a big challenge for the business model of the traditional pharmacy business.
  3. Online/App Pharmacy: There is a big challenge brewing for traditional pharmacy stores from online/app-based pharmacy stores. Slowly and surely, online and app-based pharmacy stores are strengthening their grip on the consumers.

This was the analysis of the Pharmacy franchise business. Next Franchise Business Idea after un-lockdown is 

The Grocery Store or Supermarket Franchise Business Idea 

A grocery store or supermarket is one of the favorite business ideas among people looking to start a safe business.

If we want to understand the supermarket or grocery store market, then we have to look at the FMCG (fast-moving consumer goods) market in India, which is $ 110 billion out of which.

F&B 19%

Household & Personal care 50%

Healthcare 31%

So if we remove health care as these products are not sold in grocery and departmental stores, then F&B and Household & Personal Care combine to become 69% of the FMCG MARKET. In terms of revenue, it becomes $ 76 billion, which, when converted to rupees, is INR 5.6 lakh crores. This is a huge market with great potential.

Advantages of the grocery store and supermarket franchise business.

The Grocery Store Franchise Business is a low-cost option:

It does not cost much to open a grocery store. This business gets started from a few thousand to a few lakhs rupees.

A business model in every size: This is its great advantage. If an individual wants to open a tiny grocery store, then that person can do so. Also, if someone wants to open a hypermarket, then that person can start that. Here the franchise business model is available according to every pocket.

Low operational expenses:

Operational expenses or monthly business expenses are meager in running a grocery store. At the same time, there is no separate cost to sell the goods.

Cash and carry business:

All the supermarkets or hypermarkets have cash and carry business, so there is no headache of credit and creditors. Likewise, the grocery stores also have most of its sale in cash. Alternatively, if a grocery store has to give some customers credit, that amount is secure as the customer belongs to the neighborhood, and the money is safe.

No bargaining:

As the customers buy the product on M.R.P., thus resulting in hardly any bargaining in this business. As there is no haggling by customers over the right price, the grocery store owner can maintain peace of mind. 

Points that should be carefully analyze before starting the grocery store franchise business

High competition: 

As grocery business can be started even with less money, there is high competition in this segment.

Important To Pay Attention To Following Points

Less margin:

The margins on all branded products are meager, and the customer prefers to buy branded products more hence resulting in less net earnings.

Deadstock problem:

The issue of Deadstock is in every retail business. It is natural that some items go unsold, which becomes dead stock after some time. But the dead stock becomes a problem when it exceeds the limit.

Risk of a discount store opening in the neighborhood:

This risk is for small grocery stores. If a hypermarket begins in the same or nearby area and plays at a discount to gain customers, it may become difficult for the grocery store to retain the customer.

This was the analysis of the grocery store and supermarket franchise business.

In your comments, kindly let me know what you think of these franchise business ideas.

Conclusion:  

All the franchise business ideas have their strengths and weaknesses. Similarly, all the franchise business ideas have their risks and rewards. It entirely depends on an individual to go with the option which suits it the best.

Summary:

Lockdown due to coronavirus has impacted the earning capacity of many people. Hence anybody planning to start a new business in the coming months will have to ensure that its a safe one. Safe businesses got identified based on their performance during the lockdown and after lockdown. It makes a lot of business sense to take the franchise of such a reliable business. The four franchise business ideas that were analyzed are

  • Courier franchise business
  • Multi-Brand automobile repair franchise business
  • Pharmacy franchise business
  • Grocery store and supermarket franchise business

Disclaimer: This blog is created solely for informational and educational purpose. Ideas and suggestions given in this blog are not substitute for the guidance under the expert. Readers are advised to do own due diligence before taking action based on this blog. This blog is not warranted for content accuracy. Reader’s discretion is required.