The retailer

More documents

Recommendations

Info

Business models for alternate therapy services Alternate therapy clinics are operated in various models though franchisee route is most preferred for scaling up operations. Linear Characteristics Prevalence Examples Company owned company operated (COCO) • Company owns and sets up clinic • Company manages operations and bears manpower costs • Moderate • Jiva Ayurveda • Himalaya Franchisee owned franchisee operated (FOFO) • Franchisee owns and sets up clinic • Franchisee manages operations • Company typically bears manpower • High • Patanjali • Ayurvita • Dr. Batra Hybrid Company owned franchisee operated (COFO) • Company owns and sets up clinic • Franchisee manages operations • Low • Dr. Batra Franchisee owned company operated (FOCO) • Franchisee owns and sets up clinic • Company manages operations and bears manpower costs • Low • Himalaya Patanjali and Dr. Batra’s seem relevant examples for growth of alternate therapy clinics through the franchisee route. Both players could ramp up to a sizeable extent across the country due to adoption of the franchisee–owned, franchisee-operated model. Inherent advantages of the franchising option include • Scalability within a short timeframe and efficiently • Franchisees are aware of the local sensitivities and can provide constant inputs to business • Reduced investment commitment needed as franchisees share the investments However, franchisee–owned, franchisee-operated model presents several challenges and bottlenecks • Channel conflicts arise due to price competition among channel partners including franchises • Brand name of the company can be diluted by franchisee activities • Franchisees do not share the long-term vision of the brand • There could be integrity issues with the franchisee entering a competing businesses and distribution/ re-sale of goods to other retailers • Increased expected ROI for the player 14 | The retailer
Strategies to develop a successful franchisee model in alternate therapy services Some of the key learnings and ideas from industry reveal that franchisee management needs continuous focus for success. Linear What should the franchisee business model be? How do we ensure that we select the best franchisees to join the venture? What should the terms of trade be? What are the risks we face in the franchising business and how do we mitigate them? What operational changes will we have to make for the business? How do we ensure the consumer gets the same experience at the company as well as franchisee store? How should financial and operational responsibilities be split between the company and the franchisee? In order to answer the key questions for a franchisee model, there are some imperatives that a player needs to adopt. These are: • Designing a sound franchisee business proposition: Provide a clear and transparent view of the short to long-term opportunity to a prospective in terms of investments, ROI, responsibilities franchisee will have to take up, key risks and losses in worse-case-scenario and monetary as well as nonmonetary support. A pre-requisite would also be to identify the right franchisee partner through stringent selection criteria. • Development of a franchisee management program: This includes creating a dedicated team to assist and engage with partners to monitor franchisee performance and profitability. Typically, this also includes supporting the partner in store launch, training, marketing and system support. • Aligning franchisee performance and compensation to company goals: This includes creating a clear view on franchisee operational parameters such as lease agreement, credit policy, product returns, SLOB management and termination policy. Defining a transparent terms of trade related to revenue, capital and operating expenses is critical for success. • Designing robust systems and processes: Processes need to be defined for recruitment and selection of partner to closure so that standardization is ensured across clinics for various services. This includes processes related to recruitment and selection, onboarding, goal setting and performance monitoring and lastly consolidation and closure. • Ensuring manpower quality: Hiring of manpower by franchisee partners need to be monitored as the service delivery is affected by the quality of hiring. Practitioner selection and training is a critical success factor for ensuring seamless and standardized operations across partners. The retailer | 15
Page 1 and 2: The retailer EY’s publication in
Page 3 and 4: Contents ABC of GST and the key bus
Page 5 and 6: GST is a need of the hour The need
Page 7 and 8: Overall impact of GST is anticipate
Page 9 and 10: Impact of GST implementation in var
Page 11 and 12: Nitesh Mehrotra Director Nitesh is
Page 13: Alternate therapy services: signifi
Page 17 and 18: Ravi Kapoor Director Krishnaprasad
Page 19 and 20: This year’s survey brings good ti
Page 21 and 22: Analytics: stretching your customer
Page 23 and 24: Nitin Mehta Director Sneha Gandhi S
Page 25 and 26: Notes The retailer | 25
Page 27 and 28: Our offices Ahmedabad 2 nd floor, S

The retailer

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?