Digital Franchising

India is a major player in the global franchise market, and digital franchising is poised to be a major growth driver in the coming years. The digital landscape has transformed the way businesses operate and engage with customers. Digital franchising offers a unique proposition, allowing entrepreneurs to establish a presence in the online realm, leveraging technology to provide products or services.

There are a number of factors that are driving the growth of digital franchising in India. First, the increasing penetration of the internet and smartphones has made it possible for businesses to reach a wider audience online.

India is the second largest franchise market globally, and five years from now the Franchise industry is looking to touch $140-150 Billion market size. Focusing on digital franchising, the recently launched Francast Franchise Forecast 2023 states that “Digital franchising is the new frontier of franchising that will revolutionize how many businesses operate, by combining power of the internet and cloud-based applications with the distribution scale of franchising.

Currently, in India, there are 4,600 active franchisors across all sectors operating in nearly 2 lakh outlets. More than 300 companies are starting franchising every year and 53% of all franchises are by multi-unit franchisees, it added. In this, regional brand dominates with 50 %, 34% from a national brand and rest 16% is with the local brands.

Out of this 35% of franchise concepts are F&B brands and Rs 5-10 lakh is the initial investment level for 40% of the franchisees. Though the Indian franchise market is still nascent, the industry accounts for close to 2% of the national GDP but has created one million jobs.

The global franchise market size reached $100.7 billion in 2021-2022 and is expected to grow at a CAGR of 9.73% till 2030. "The global franchise market is expected to reach the value of $175.9 billion by the end of 2030 .

With the emergence of digital franchises, offering a low-cost and flexible avenue for entrepreneurs to leverage technology and provide products or services exclusively through digital platforms. This innovative model allows aspiring business owners to tap into a proven business framework with minimal overhead costs and a broader market reach.

Dr. Deepak Kumar Sahu, President & CEO, VARINDIA