We have 57 franchisees and to grow way faster: Dr. Batra’s Group CEO

Homeopathy market in India is currently worth Rs 2,758 crore. The organised Homeopathy market is Rs 270 crore, which is about 10 per cent of the total market. In the recent years, the Homeopathy industry has evolved to become more organised.

When we talk about Homeopathy, Dr. Batra’s Healthcare is a ‘must talk about’ brand in the category. Founded by Dr. Mukesh Batra, a Homeopath of international repute, Dr. Batra’s Healthcare has is spreading its presence rapidly, not only in India but in overseas market as well.

In an exclusive interaction with WI Bureau, Sandeep Saxena, Group CEO, Dr. Batra’s Healthcare has shared the present scenario of the brand’s franchise model in India along with its business growth and expansion plans of expanding its presence in southern region of the country.

Franchise model on offer

We have gone into franchise model with two very strong pre-requisite models. We have perfected a business model ourselves, where unlike many other brands, we’ve started franchising after achieving 100 centres of our own, running successfully for a substantial period of time to get a sense of what will be the return on investment, how perfected is a model in terms of profit and profitability, and after 100 centres, we’ve started looking at franchising as an option.

Our strategy is to really penetrate smaller towns, which are the B&C class towns, where franchising would be a better mode of reaching out and penetrating rather than doing things of our own because there will always be resource and investment constraints. So, we’ve kept top metros, class A, class B+ categories for ourselves, and tier II & III towns for franchising model.

Terms of franchising

It’s a revenue sharing model and its only one model. It’s driven by a clear financial treatment, which includes the franchiser and the franchisee. It’s based on an expected investment. The return which a franchiser will get over his investment and therefore, the revenue share model has evolved which is beneficial for both the franchisee and the franchiser. We are very clear that we want our franchisee to be profitable and to earn money and to sustain in the business and invest in the business. On an investment of above Rs 25 lakh, the ROI is between 6-8 per cent per month and the payback is probably the shortest in the industry, which is about 12-18 months. There are certain franchisees, which have got 100 per cent payback in about 12 months time. Today, we run about 57 franchisee centres. Our franchisee model is initially for the tenure of 5 years, and it is renewable over a period of time.

Top franchisees

Khatwani Sales, who started with us with 1 franchisee in Jabalpur, have expanded it to 8 clinics in Madhya Pradesh and Chhattisgarh over the last 1.5 years. He started with 1 clinic, and then he found our partnership and brand attractive in terms of business proposition. So, this has been a great success story, and I can tell you that Khatwani Sales today contribute about 15 per cent in our overall franchisee business.

Emerging trends

In terms of the emerging trends, I can say that the highest penetrating category in franchising is Consumer Service space. The second one is F&B (Food & Beverages) and the third category is Education. These three categories are very well evolving in terms of increasing number of centres and increasing business through the franchisee route. For example - Compared to 2,800 franchisee businesses in consumer service, the number is expected to reach 15,000; in consumer service or F&B space, the number would be reaching 20,000; whereas in Health & Wellness, the number is likely to reach 17,700 by 2017.

Growth driver

There is an acute scarcity or gap in healthcare industry – what is desired and what is available to the people. That’s the reason why healthcare, and not just franchise in healthcare, is showing a lot of growth, which includes Pharmaceuticals, health, healthcare industry in terms of hospitals and all. There is a big gap between the healthcare categories itself. The next big issue is accessibility and our model is catering to the needs of the people. Hence, we can see a lot of retail, family healthcare, and home care models emerging in the healthcare space. All these categories are driven through the franchising route. In my view, Franchise is the preferred route to scale up the numbers initially. Today, Dr. Batra has got 207 centres across India and world, out of which, 57 centres are franchised outlets and we are expecting to grow the franchise business much faster in order to penetrate in more towns. So, it’s a attractive category. The category itself is growing fast and has a lot of potential.

Criteria of franchisee selection

We have a very experienced team who is working on the franchise business. We look at things like what is franchisee’s experience in wellness service sector, whether he runs and have some understanding of the category, his track record in terms of running various businesses that he is running, which also involves the financial capabilities of the person, and most importantly personal interviews, in which, we try to understand how much the person is passionate about or interested in getting into healthcare.

Franchise-franchisor relationship

We provide medical expertise or the homeopathy expertise to our partners, which include the knowledge of the medicines, the medical protocols and all providing support to the franchisee in terms of selecting of the doctors and medical team and then the medical training for two things – medical processes and patients’ processes. That is where the real expertise comes in for Dr. Batra’s. We handhold the franchisees right from the selection of the location of the properties, guide them over the design of the clinic, providing design support to them, also medical process, patient process and also on how to run their business, which means a lot of support comes in form of digital marketing. We provide them all brand design, campaign design, and call centre support which is very important for feeding patients into their clinics. It’s like 360 degree support, which is all the time available to all our franchise partners.

Touching the untouched area

We now want to explore south as an area, where we are underpenetrated. So South India is our focus area for further expansion, which includes Salem, Trichy, Rajamudri, Thrissur, Gulbarga and Udupi. These are the towns we are looking at for inviting franchise partners.

Future expansion plans

Right now, we are looking at homeopathy and also we are looking at franchising of pet care.