JUMBO KING RE-INVENTS ITS FRANCHISING MODEL

Jumbo King has been one of the most successful modern day franchise stories. In a recent development, the brand has now decided not to appoint any more individual franchisees and go in for master franchisees instead. Confirming this the MD Dheeraj Gupta said, "we have seen that our franchisees who are operating multiple stores are far stronger and stable and are able to weather ups and downs in the business environment than single store operators who are more vulnerable. With this insight, the company has now decided to give out franchisees only to people who can invest in over 5 stores or about 50 lacs." Another important insight was that in general, any other franchise business requires a min investment of 25 to 50 lacs. Since the Jumbo King model is low on investment, the franchisee will be able to make multiple investments and reap better benefits. Adds Gupta, "Unlike other food formats where he would invest all his money in one store and the risk of site selection would be very high, the same money spread across 5 locations gives him tremendous flexibility. Going forward, company owned stores and master franchisees will be the strategy for Jumbo King." In an almost unprecedented move, the company has also offered to buy back the stores within a stipulated period where the franchisees investment gets protection at a certain depreciated rate. The role of the master franchisee will be that of a pure investor, while the company identifies the sites, puts up the store and manages it. The brand has presence now in the states of Maharashtra and Gujarat and is now looking at Mumbai, Hyderabad, Ahmedabad, Bangalore, Nagpur, Pune and Delhi as focus areas. Jumbo King is valued conservatively at about 40 crore and is now all set to be a major contender in the food and beverage industry, which according to industry estimates is growing at 40% year on year.