Towards the end of 2019, the world witnessed the outbreak of COVID-19. By January 2020, the World Health Organization (WHO) declared COVID-19 a pandemic. The impact of this pandemic on businesses in general, and franchising in particular, cannot be ignored. As the number of COVID-19 cases increases daily and governments struggle to develop a strategy to contain the spread of the virus, like every other sector, the franchising community too must prepare itself for the new normal.
The pandemic has set off a deep economic crisis where crucial changes will be made in how individuals, organizations, and economies work in India. The franchising community in India has never encountered an emergency like this. The quick impacts are obvious with the closure of the salon, pre-schools, K12 schools, food outlets, retail shops, and others.
However, with economic adversities, new ventures and opportunities have arisen bringing a renewed hope of recovery. Organizations offering door-step banking, telemedicine, online specialist consultation, online retail, online instruction, and others have to a great extent witnessed a positive effect.
Here are the top 3 sectors in which you can invest in the current time:
1. Edtech Sector:
In recent years, education has evolved to incorporate more innovative technologies in the classroom. The recent COVID-19 pandemic has accelerated this digital transformation, as educators have been forced to think outside of the classroom-sized box to ensure continuity of education while quarantine keeps students out of schools. With it, the growth of tech innovation, as well as access to online courses and digital content has exploded. Institutions of every size and type are now experimenting with various ways to teach and learn on the internet.
The global tutoring market is growing at 13.7% CAGR, and Asia is emerging as one of the most lucrative markets for online education. Advancements in technologies, including the incorporation of artificial intelligence, are now making it increasingly possible for students to seek and receive virtual tutoring assistance at the point of need.
If you’re looking to invest in an edtech business, here are the top 3 brands that will reap you huge profits:
1.1 WhiteHat Jr:
As per industry experts, coding is the next big frontier for Edtech. In fact, Edtech startups in the coding and programming segment have come into the limelight post-Byju’s acquisition of WhiteHat Jr. Experts say that coding classes help children build a cognitive and analytical thinking process and will be crucial for their career development.
To target the current market, the Edtech firms are devising a franchise model to strengthen local networks. For instance, WhiteHat Jr offers partnerships to business owners at an initial investment of Rs 5-8 lakhs (depending upon the population of the city/town) for an exclusive zone limited to 2-3 pin codes. The franchise partners can earn over 15 percent of profits for each enrollment. The partner is responsible for the enrollment of students from the region and operational management of the franchise. The company provides marketing collateral, an online platform, content, and trainers/teachers.
1.2 UpGrad:
UpGrad is an online higher education platform providing rigorous industry-relevant programs designed and delivered in collaboration with world-class faculty and industry. Merging the latest technology, pedagogy, and services, upGrad is creating an immersive learning experience, anytime and anywhere.
The company offers two models of franchising: Authorized Business Associate and Channel Partner. Authorized Business Associates acts as a representative of upGrad and are required to have an office space of 500-700 sq. ft in a commercial/semi-commercial location. The initial investment required for this model is Rs 15-17 lakh, which includes a franchise fee of Rs 5 lakh. With a 15-35 commission on sales, the company claims that Authorized Business Associates are able to recover their investments in a period of 6-8 months. On the other hand, the channel partner model doesn’t require any physical space and works solely on a commission basis.
1.3 Testbook:
Developed an online test preparation platform intended to help students to prepare for competitive exams. The company offers a platform for students to learn new concepts, attempt mock tests, and compare their preparation levels with other users, enabling users to easily prepare for online exams.
Edtech startup Testbook is creating a local partner network in Tier 2 and smaller cities. Notably, the price points offered by the franchise partners are quite lower than the prices offered by the company directly, which helps in sales and building trust among the local customers.
2. Generic Pharmacy:
As per recent reports, the Indian pharmaceutical industry is largely dominated by ‘branded generics’ that are cheaper, more effective, and safer. When it comes to manufacturing, retailing, and exporting generic pharma products, India is one of the major players present in the world. Being the second-largest producer of generic drugs, the Indian generic market is anticipated to offer so much to the Indian economy. India is among the big players in the manufacturing and exportation of generic pharmacy products but the manufacturing and exportation alone are not enough to make such products accessible to the general public.
If the business of Generic Pharmacy excites you, here are the best 3 brands for investment:
2.1 Genericart:
Genericart Medicine is India’s No.1 Generic Medicine Franchise Company. This is India’s only company that is providing quality control certificates of every product, every batch. Customers can check these certificates online in existing shops.
Currently, the company has more than 1100 registered shops named “Swast Aushadhi Seva/ Genericart Medicine” in Maharashtra, Karnataka, Kerala, and Goa. Out of them, 950 shops are running successfully, while 150 shops are under the opening process. The company has already registered more than 500 district heads, and over 60 lakh satisfied customers are taking benefit from its shops. Genericart Medicine’s turnover crossed Rs 40 crore in the last four and a half years. The brand has a full product range of more than 3000 products.
With an initial investment of Rs 10-12 lakh for an area of 120-250 sq ft, one can get a Genericart Medicine franchise. This franchise has an average medicine sale margin of 50%, with an ROI of 18-24 months.
2.2 Generic Aadhaar:
Generic Aadhaar, a very young and innovative startup, is founded by one of India’s youngest entrepreneurs, Arjun Deshpande. Known as a Pharma Wonderkid, started at the novice age of 16, this startup is a new revolution in the Indian pharma industry.
The company’s sole mission is to provide affordable and accessible high-quality medicines to every Indian. Ratan Tata joined hands with Arjun Deshpande in this highly impactful venture Generic Aadhaar for the betterment of every India.
To own a Generic Aadhaar franchise, 200 sq ft of area and investment of Rs 4,00,000 is required.
2.3 Sanjivani:
Sanjivani is a well-known name in the pharmacy segment of the country providing comprehensive, world-class solutions in the field of pharmaceutical retail and distribution. Sanjivani specializes in providing a complete bouquet of products under its store, particularly in the pharmaceutical industry.
The company is a reputed name in the field of distribution and aims to provide people with complete solutions catering largely to their health care needs.
To own a Sanjivani franchise, 500 sq ft space is required with the initial investment starting from Rs 10 lakhs.
3. Logistics Sector:
Coronavirus pandemic has caused direct or indirect effects on every industry. Many grappled their way through the lockdown and unlocking stages. Perhaps, the case before and post-COVID-19 has declared a pandemic was different globally. Logistic enterprises impacting movement, storage, and flow of goods have been directly impacted by the pandemic. As a basic piece of the supply chain, interruptions in operations will affect competitiveness, economic growth, and job creation alongside facilitating trade and commerce. 30% of the product cost is held by the last mile thus optimizing it is important. Deliveries have become safe for agents and clients by making contactless last-mile delivery arrangements post lockdown stages.
Looking to enter into the logistics business, here are the top 3 brands for making an investment:
3.1 DTDC:
A home-grown logistics firm, DTDC is one of India’s leading express parcel service providers. Founded by Abhishek Chakraborty in 1990, the logistics behemoth has a presence in 500+ district headquarters. With a network of 10,500+ franchisees servicing 10,500+ pin codes in the country and 240 international locations, DTDC handles more than 12 million shipments in a month. To forge better in-roads in the global industry, the company has recently partnered with Asendia, a joint venture between French postal service La Poste and the state-run Swiss Post.
DTDC’s franchise network is built on the fundamental idea of fostering entrepreneurship; creating business opportunities for people from all walks of life; and forming a channel for social change. The company has a countrywide system of 10,500+ low-cost franchises which cover more than 95% of DTDC’s network and contribute to 75% of its business.
The brand offers different types of franchise models including single-unit franchise, covering a small territory, or a particular pin code requiring an investment of Rs 1.5 lakhs for an area of 250 sq feet. DTDC also offers a master franchise of an area within city limits and a super franchise that covers a district or territory.
3.2 Shadowfax:
Logistics is a much-growing industry today. With the sudden growth in the requirement of delivering goods to the doorstep, the logistics industry is witnessing fast growth. Investing in logistics is a very profitable one as B2B, B2C as well as a new area D2C are in need of delivery services today.
With the rise of dark store concepts, a new model of D2C mode of delivery has come into existence, where the product is directly delivered to the consumer. These kinds of innovative models are most often seen in logistics. With changing scenarios, logistics get newer models. But it doesn’t stop. Hence, investment in this sector is a safe one.
In order to invest in the Shadowfax franchise, you require an investment of Rs 10,000 - 50,000 for an area of 200-400 sq ft. ROI received in this franchise is 50%.
3.3 IHAUL LOGISTICS SOLUTIONS PVT. LTD:
Ihaul logistics solutions provide B2B goods transport services to MSMEs/Industries /Manufacturing units. They are the aggregators of LCV/goods vehicles and provide a technology platform for industry owners/managers to book & plan their goods, product delivery or supply. Their intelligent technology platform optimizes the route planning & capacity planning of our fleet and ensures the least cost for transportation. Ihaul offers customers reliable services with a dedicated fleet in each industrial hub, GPS-enabled Mobile Apps to track vehicles, and system-generated accurate billing. They have 20-50 franchise units across the nations and initial investment can be from Rs 2-5 lakhs.
