India an engine of economy

Babette Marzheuser-Wood, a Senior Consultant, Franchise Strategy, FFW Consultancy LLP has been advising clients on international franchising for more than 15 years. Her clients include some of the leading global franchisors such as Starwood Hotels, IKEA, Costa Coffee, Ramada, Dunkin Brand and many more. In an interview with FIHL, she shares various aspects of associating with a western brand through franchising.

Ramanjit Kaur (RK): What sort of potential do western brands find in Indian market?

Babette Marzheuser-Wood (BMW): I think most western brands are attracted to the Indian market as they see India as an engine of economy for the future. Together with China, Brazil, and with number of other eastern European countries, the western brands are targeting India now.  So, without doing too much of market research, they are spontaneous in sealing it to be in India to derive maximum benefits.

RK: Do western brands get themselves modified as per the local requirements of the targeted country or state?

BMW: No, that’s not the case in point. Usually, they would do their own research, and if they find that their concept will not be suitable in the Indian market or in another targeted country, then they would not prefer to come to that country. Rather they will try and go somewhere else.

RK: What a western brand look for in its prospective Indian franchisees?

BMW: Most western brands look for someone who can open upto 20 to 40 stores. The prospective franchisee must be financially sound, have skills to run business effectively and efficiently and must have good amount of experience in managing the employees and the franchise business.

RK: What kind of support do the western brands provide to its Indian franchisees?

BMW: Most good franchisors provide intensive training and regular sessions. They also provide marketing and advertising support. They also give regular brand up dates, innovative ideas for improving business and give access to the helpline.

RK: As every coin has two opposite sides, similarly there must be disadvantages of associating with western brands along with the advantages? Tell us the pros and cons of partnering with a western brand?

BMW: The pros of partnering with a western brand are - 

• A well known brand for which customers already have an expectation for quality and probably are prepared to pay more money. So, there is no need to convince the customers on quality aspects.
• Other biggest advantage is that the concept of franchising is a tried and tested business system.

In discussing about the disadvantages I suppose, western brands are a bit inflexible in how they want everything to be done. They want everything to be done in the same way as done in the West. So, in such cases, how to communicate with the western brand and how to achieve the desired results are some of the most challenging parts of associating with a western brand.

RK: Is there any guarantee for success by partnering with a western company?

BMW: One cannot give cent percent success guarantee in such partnership. Also an entrepreneur needs to do the feasibility study and check out whether a brand which is already successful in UK is going to be equally successful in India or not.   Thus, it is advisable to analyse the potential of the brand, if one is thinking of associating through franchising.

RK: Apart from India, which are the other potential markets in Asia?

BMW: Some markets which are in demand apart from India are Brazil, China, and Russia.