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The Benefits of Indian Fast Food Franchise

The Benefits of Indian Fast Food Franchise

According to popular belief, the world’s first restaurant opened its doors in Paris in 1765, serving a single meal to tired travellers.

However, since then, dining out has a much different meaning. Restaurants were initially solely intended for travellers far from home, and it wasn’t until the late 18th century that dining out started to become a popular pastime for residents.

Despite the change in this tendency, the idea of quick food didn’t exist until the late 19th century. As the term implies, “fast food” describes meals that are frequently constructed using components that have already been heated or cooked, prepared in large quantities, and provided to customers in a matter of minutes.

When the first significant fast food chain, McDonald’s, arrived in India in 1996, the populace was still mostly reliant on street sellers, Udupi eateries, and “tiffin” lunch boxes. India was one of the marketplaces for fast food that was slow to adopt it at first, but it is now one of the fastest expanding.

The Indian Fast Food Chain

In India, the fast food sector, sometimes referred to as Quick Service Restaurants (QSR), has grown rapidly. Since McDonald’s opened its first shop in India in 1996, a CRISIL analysis claims that multinational fast food chains have had a 63% share of the country’s quick service restaurant sector. A rising young population and a rise in disposable money have been attributed as the main causes of this trend. These factors will cause the Indian fast food business to grow at a 10% yearly pace and reach a value of US$27.57 bn by 2020, establishing it a new mega-market for foreign competitors.

The franchise model has played a major role in the expansion of these fast-food restaurants both internationally and in India. Food franchises have grown to be so well-known over the years because when you think of a “franchise,” the first few names that spring to mind are always those of food franchises. The franchise model has shown to be advantageous for both the franchisor and the franchise owner, as seen by the over 400 McDonald’s locations, 1200 Domino’s locations, 500 Subway locations, and 422 Pizza Hut locations. Haldiram’s, Bikanervala, Naturals Ice Cream, Frontier Bakery, and many more Indian businesses have successfully adapted this strategy. As India grows into one of the quickest increasing F&B businesses in the world, it’s safe to set one’s bets on the fast food industry while attempting to develop a lucrative business in the nation.

Starting a fast food franchise in India Has Many Advantages

According to the International Monetary Fund, India has the world’s fastest-growing economy, and it is no secret that Small and Medium-sized Enterprises (SMEs) have played a significant role in this expansion. So it seems sense that individuals would want to create a SME, with the fast food industry being among the most popular options. However, not everyone wants to take on the risk of starting a business from scratch, which is why franchise brands come into play. The following is a list of the main benefits of starting a fast food franchise in India:

A Simple Setup: Franchises may be set up rather easily. Typically, a franchise owner must pay both an initial start-up charge to the franchisor and an annual licence fee. In exchange, the franchise owner has access to the franchisor’s well-known brand, devoted clientele, recipes, and trademarks. The franchisor provides assistance with employee training, clothes, and the layout and decoration of the shop. Especially for those who have no previous experience starting a business, this support system is what makes purchasing a franchise so alluring.
Demand for fast food restaurants is constantly rising: In a nation of 1.37 billion people, with 65% of the population under the age of 35 and more than 600 million internet users, exposure to different cuisines from around the world and global trends have had a significant impact on consumer choices in India. It is not surprising that the bulk of foreign fast food businesses have seen great success here. According to a survey, India is predicted to experience a four-fold increase in consumer spending by 2030, with a middle class predicted to increase from 50% to 80% and account for 75% of all consumer spending. As a result, a sizable share of the benefits of this adjustment will be borne by the fast food business.
Easy Access to Cost-Effective Labor: India, which boasts the world’s biggest young population, has significantly easier access to skilled, trained, and labour that is both cost-effective and efficient. With a workforce of more than 500 million, it is not hard to discover workers in India who are better suited for the various job responsibilities in the restaurant industry. The English language proficiency of Indian labour is another noteworthy benefit, making it very well for serving customers from varied cultural backgrounds and assisting foreign firms in building a genuinely global reputation.
Quick brand identification: Finding the best ways to advertise the brand, increase familiarity, and efficiently attract customers is one of the most difficult jobs involved in starting a fast-food restaurant business. In a market as competitive as India’s, it’s an essential stage in business establishment and has the capacity to make or destroy the brand. This is a significant danger element that fast food chains virtually remove. A franchise outlet benefits from the franchisor brand’s existing customer base as well as the overall brand’s marketing assistance, which gives new company establishments a much-needed push.
Simple Innovation: Since customers will always seek tastier, more inexpensive, and quicker meals, the fast food sector will never go out of business. Additionally, innovation in this industry is less expensive than in many others since, for example, introducing a whole new menu does not always necessitate purchasing new equipment or hiring new personnel. A franchise owner also need not worry about the creative expenses associated with changing their goods in response to the always changing wants and needs of the consumers because they are a part of the franchisor network.
Before starting a fast food franchise in India, there are several things to think about.

After discussing the benefits of investing in the fast food sector for prospective investors, let’s look at a few things to take into account before starting a fast food franchise in India:

Capital Required to Start a Franchise

A potential franchise owner must first and foremost be aware of the financial and personnel resources needed to establish and manage the franchise outlet. Even though the franchise model largely eliminates the risk of failure, it still necessitates a sizeable capital investment on the part of the business owner. This capital investment includes the rent or ownership of the outlet, start-up costs, annual licencing fees, hiring talented staff, and occasionally also sharing a percentage of revenues. In other circumstances, investors could even need to demonstrate that they have the financial resources to establish many stores over the course of a few years. Therefore, in order to ascertain whether the franchise business option is cheap, one must conduct extensive study on the franchise they wish to purchase.
Species of Food: There are many various types of restaurants to pick from when you are thinking about buying a franchise, even though there isn’t much room for creativity once you’ve purchased a franchise. Although the fast food industry may have started out with hamburgers and fries, it has since seen a significant evolution, providing customers a wide range of alternatives. Similar to this, a potential franchisee can choose the type of cuisine they feel most at ease selling. The wide selection of hamburgers at McDonald’s, the variety of freshly cooked cold sandwiches or salads at Subway, the bigger choice of fried chicken at KFC, or the freshly baked pizzas at Domino’s or Pizza Hut are a few well-known examples. If you also wish to provide Indian cuisine, think about using Haldiram’s or Bikanervala as examples of Indian brands.
Employing Personnel: The personnel of the restaurant, the waitress, the delivery guys, and the management are the ones who engage with customers the most frequently. Hence, it is of essential importance that you pick competent and dependable employees: cooks, managers, waiters & waitresses. Additionally, it is crucial that they comprehend the brand’s vision and aim and effectively apply it to their work responsibilities. Industry norms include regular feedback, training, prompt salary distribution, and paying overtime.
Recognize many franchise ownership models: Franchisers frequently provide a variety of ownership arrangements. Some of the typical alternatives to select from include a single-store franchise, multi-store franchise, area developer or master franchise. Before you decide to plunge into the fast food franchise industry, it’s necessary to comprehend and assess the advantages and downsides of each sort. The sort of franchise owners that would be suitable for you also depends mostly on the amount of funds and time you are ready to put in the business. For example, first-time investors could select the single-store model to understand the complexities of the business while seasoned entrepreneurs might opt to develop a multi-store franchise firm without numerous partners to reduce the risk.

Overall, India has shown to be both a fiercely competitive market and a consistently expanding one for the fast food sector. Unquestionably, opening a fast food franchise business is among the simplest methods to launch and operate a successful business. It is not surprising that large multinational F&B firms are adapting to Indian consumer preferences and working to maximise their market share in India given the country’s fast-paced economy. Please fill out our Investor Enquiry Form if you are interested in learning more about how to start a franchise restaurant in India.

An engineer by qualification, Gaurav started his career in sales and marketing due to his affinity towards networking with people. After learning the tips and tricks of the trade, he made a fresh start as an entrepreneur in the franchising industry back in early 2018, with a vision to bring order and transparency to an unorganized sector. He founded and spearheaded Frankart Global Private Limited, where he consulted, developed, and scaled more than 120 domestic and international brands all over India ranging from different industries such as food & beverage, beauty & wellness, and FMCG retail to name a few. Post-Covid, in mid-2021, he developed FranDocX, India’s first ready-to-use franchise documentation service portal, for the MSME entrepreneurs who were severely affected by the pandemic, and wanted to avail an affordable franchise solution service. His aim is to regularize ethical business practices in the franchising sector so that a greater number of investors can participate and avail the benefits of a structured franchise framework.

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