In an interaction with Franchise India, Sameer A Kachru talks about the modern day franchising, the franchisee and the franchisor relationship and the speed traps in the business.
How is the modern day franchise owner’s model changing?
We are looking at new units, new cities. We are looking at metro cities as a start point. We have now gone into Tier-II and Tier-III markets. Home grown brands like ours which is to be functioning in India before are also looking at the international markets because of the reason that one with the exchange rate benefiting us internationally and it is a very viable option. The other thing is the Indian foods demand worldwide has increased tremendously. Newer markets have come up. Initially there were only parts of US and parts of UK and parts of Gulf which were interested in our foods in India. But today the Australian market and even the South African market, in fact we have got a lot of leads from Australia and South Africa where people are interested in taking Indian Franchise brand to their country because they believe that there is the market gap which is available. The modern day Franchisor is now looking at entering to new territory and is what I would look at above all.
How to create an atmosphere of positive franchise relationships and avoid the pitfalls of being always adversarial?
The best relationship is always when the franchisor is making money because the franchisee is making money. So, if the franchisee is going to make money you are going to be happy at the end of the day. But more or less you need to make sure that your support is just massive that you are always behind the franchisee when they need the help. For example; as on today if we have flown down someone to US specifically to give support to our franchisee at our cost this is not as per contract only because we feel that they need support. They are currently doing well but we know that they can do far better. So, if they do better than eventually my royalty in India is going to be higher. Providing them support so that they can start new revenue channels is important. Right now they are only focusing on fine dine so that they can focus on to go packages that will give us money coming into the business for the franchisee and franchisors both.
How do you find the concept ‘the slower you move the faster you die’? How appropriate is this in food business?
I think the faster you move the faster you die because the carpet will roll behind you. You will not be planned at all. You need to move initially quite slowly, take the plane to the runway by fuelling it rather than not trying to fly without fuel and crash landing. So, if you are building a brand spend two years on your backend minimum and employees are resources which should have 15 years of experience each across various industries vertical not just QSRs rather look at QSRs, casual dining, fine dining and bars. This will give you a clear picture even if you are creating a QSR chain. So, I would move slow initially and then speed up. Once you are totally ready you can fly.
Tell us about your company. How is the backend structured?
For last few years we are only pumping money in to the backend. Systemise operating procedures have been put in; reporting is kept on daily basis. We even enforce something called a daily PNL which is kept with the franchisee. They are supposed to report to us on a daily basis. Everything is systematic now and backend is in place.
Tell us something about your journey?
The journey has been tough. we are built to franchise not to operate on our own. We have learnt a lot through our franchisee in this journey and we are going abroad was a biggest learning for us as a brand.
What advice you would like to give to the new restaurateur?
Be very clear whether you want your own brand or a franchise. If you want to franchise learn to play within other people boundaries and don’t go out of that because that is illegal. If you want to play on your boundaries don’t franchise. Create your own brand and you’ll be happy.