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How can I ESTABLISH A BUSINESS FRANCHISE IN INDIA?

October 26, 2008

HANS LAXMAN RAJ asked:


Hi Friends,

I would like to establish a Business Franchise in India. Because it is one of the fastest growing economies in the world, it is a great place to invest. I am currently exploring franchise opportunities that have great market potential.

What actions do I have to take?
Where do I start out and what are the first steps?
What do I have to plave for etc?

If anybody has a any good websites, books, consultancies etc that would be great.

Thanks Friends,

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Comments

3 Responses to “How can I ESTABLISH A BUSINESS FRANCHISE IN INDIA?”

  1. den invent on October 29th, 2008 7:40 am

    with great caution

  2. Hidden Dragon on November 1st, 2008 4:36 am

    hi mate, nice idea, but i think you’ll find that no sooner that you have launched YOUR idea, some mug will have already started FRANCHISING a copy of it.

    yeah i agree that India has great potential, but like with any other developing nation, the foundations of commercial law aren’t quite in place YET! its a case of who knows who and who can give what, you get my drift?

    good luck anyway, hope my negative answer hasn’t dampened your enthusiasm!

  3. fanofmawson on November 2nd, 2008 1:28 am

    I don’t have much insight on the India-specific market, but I am a former franchisee of a company and have done extensive research in the field. These sources may help, to varying degrees:

    Franchising Association of India:
    Mr. C. Yoginder Pal, Chairman SIG
    Veer Nariman Road
    Churchgate, Mumbai 400-020, India
    Phone: (91-22) 282-1413 Fax: (91-22) 204-6141
    E-mail Address:

    A few general sites:

    Site listing consultancies that assist w/franchising internationally:

    I would highly recommend the following two books, for different reasons:

    “From Ice Cream to the Internet”, by Scott Shane
    Very insightful resource on the challenges of establishing your own franchise.

    “The Franchise Ratings Guide: 3000 Franchisees Expose the Best & Worst Franchise Opportunities”, by Gary M. Kowalski
    A great insight for anyone considering investing in a franchise, the book provides a fantastic and thorough section on the due diligence process that should be followed by any prospective franchisee. This section would also be very relevant to anyone considering establishing a franchise.

    As a final bit of advice, if you come across a quote similar to the following, don’t believe it. There are many variations to it with different statistics substituted, but not substantiated.

    “If you buy a Franchise Business, your chances of success are 94%! THAT’S A FACT, according to a recent Gallup poll. Conversely, it’s estimated that only 35% of independent business start-ups survive 5 years.”

    As it’s pervasive, people tend to find it credible; but here’s a link to the FTC’s website that will back up what I am writing. The found the above quote to be “fraud and a misrepresentation”. I would inquire of the source to anyone who quotes similar statistics.

    More credible is an in-depth study by Scott Shane, which showed vastly different results. Dr. Shane found that:

    “…despite the widespread reach of franchising, surprisingly few companies succeed at franchising. In fact, of the more than 200 new franchise systems established in the United States each year, 25% don’t even make it to their first anniversary, approximately three quarters fail within a decade, and only 15% make it to 17 years.”

    Good luck!