Gaining glittery, golden profits

A peek into the Indian jewellery industry reveals that the global market for jewellery is expected to surpass USD 257 billion in 2017. The market is predominantly driven by the Asia Pacific and The Middle Eastern markets, but U.S. continues to remain the dominant player in the industry. Indians no longer prefer buying jewellery from the traditional family jeweler. Because of the readily available designs and huge variety, people are giving preference to organised retailers.

Walking the franchise route

India is a much diversified country and it is quite difficult to set company owned stores in most cities, So, a franchisee helps in enhanced understanding of the local market and to bridge the gap from an organised jeweller to a local jeweller. Ajay Nihalani, CEO, Maya Jewels, says: “Gitanjali is a strong brand name pan India. Our franchisees help us in establishing Maya Jewels as top jewellery retail chain across the length and breadth of the country.”

While ORRA has a strong presence in tier I cities, it has rapidly expanded its presence to tier II cities and is looking at a more robust expansion in the future. Demand for branded jewellery in urban areas and tier II cities is fast increasing as customers now prefer   buying from a trusted national branded player vis a vis their local family jeweller and so, ORRA took the franchise route for faster expansion.  There is no doubt about the fact that partnering with a franchisee helps any brand grow at a faster rate as the franchisee brings with him an in-depth knowledge of the local market and better hold over the market.

Tanishq jewellery from Titan has been franchising since 1997 and has expanded to 150 + Tanishq boutiques. Sandeep Kulhalli, VP, Retail and Marketing- Jewellery, Tanishq opines: “Franchisee is important for retail channel expansion because they understand local market trend better and can connect to consumer at an emotional level. Also, they can come up with promotional activities relevant for their market and since they have invested in the brand, they equally feel responsible in the growth of the company by bringing out their strengths.” For Primmero Jewels franchising is the fastest and successful expansion strategy where the franchisor need not worry about the finances for the expansion of the brand.

Road ahead

In the fast growing jewellery Industry, almost every retail brand is expanding via franchise route and thinks it to be the safest way to expand. Maya Jewels is currently present in around 14 cities with about 25 stores. The brand plans to open 150+ stores on a pan India level. ORRA is now looking to move to the next level of being a full service branded jeweller across its stores. The brand plans at least eight franchise outlets by Dec 2013. “While we are looking at consolidating our presence in the existing cities, we are also looking at a robust expansion in tier II cities, as there is a huge potential for the branded jewellery market in the smaller cities.” says- Vijay Jain, CEO, ORRA.

Tanishq targets 25 franchise outlets by end of 2013. The new entrant in franchising, Primerro Jewels acknowledges the amazing response to its products from Indians and plans to adopt the franchise route. Ram Mohan Rawat, Founder, Primmero Jewels comments: “Once the brand opens and manages to operate four to five stores successfully, then franchise route will be much easier.”

Criterion for franchisee selection

Taking a franchise of any recognised jewellery brand can be a lucrative franchise opportunity for aspiring entrepreneurs. The jewellery industry has a lot to offer to the prospective franchisees. Tanishq was Titan’s first diversification project after it had established itself as the leader in the watch industry in India. Most of the brands assert on the fact that a franchisee must have proper understanding of the market. Tanishq assists in getting the franchisee completely equipped to handle operations starting from recruitment of staff, a structured training programme covering induction, product training, and developing required skills, behavioural and business related training for both franchisee and the staff. For most of the brands, the imperative criterion for selecting partners is that they should be committed and able to understand what it takes to run this business. Santosh Srivastava, MD, Gitanjali jewels says: “All our franchisees are taken through an induction program where they are given intensive product, sales, and operations training. Training is also provided to the staff by a team of special trainers. Training to staff includes product knowledge, communication skills, current schemes offered by the company.”

Why Jewellery franchise

• Jewellery is one of the fastest growing industries.
• Branded Jewellery is likely to be the fastest-growing segment in domestic sales. The sector is expected to grow at 40% annually.
• Sustained economic growth in India.
• Jewellery is no longer perceived as investment only; now it’s emerging as a fashion accessory.
• New Potential Markets in tier II and III cities and towns.
• No formal degree or qualification required. Just passion for jewellery.
• Excellent RoI
• Most franchisors provide complete training and support.
• Large number of aspirational consumers moving to branded jewellery segment.

A look at the world markets

• Hong Kong's jewellery industry is dominated by the precious jewellery sector. Its development has been facilitated by the expansion of the local market, including sales to tourists.

• Traditionally, the Chinese jewellery market has been dominated by large white diamonds used on bridal occasions but there has been a structural change in the China market. Chinese consumers are increasingly seeking diamond jewellery as a daily fashion accessory.

• U.S. currently accounts for the largest jewellery market in the world with more than half of its market being dominated by the diamond jewellery segment.
• Platinum has gained strong foothold in India within a decade of making its debut in a country heavily obsessed by gold.

Conclusion

The global market is now witnessing a step up in the overall jewellery sales and with the rising disposable incomes and changing lifestyles; the global jewellery market is set to experience a strong growth over the approaching years. So, get ready to choose a dazzling and money-spinning career in the jewellery franchising Industry.

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