Problems Faced by Franchise Model Business Expansion in Rural India

Abstract

The Indian urban market has transformed from the normal way of doing business to other means so as to create value for the customers. One area which has seen drastic growth is the franchise model of business. The franchise model has grown well, and the franchisees are able to get better returns for their investments. Franchises are available in the product and service sectors. This study looks into the rural areas where the franchises have not developed, as in the case of urban areas. The study was done with peers in the rural areas as well as the established franchises in the urban area. Franchises in the area of education have seen some success in the rural areas, but the other sectors are lacking. The reasons for the factors were the growth potential of the franchise, affordability of the customers in the rural area, value creation by the franchise to the rural customers, and profitability of the franchise. The analysis gives a direction that the franchises can take for a successful expansion in rural areas by achieving profitability with value creation and affordability to customers and growth of the franchise. Expansion of franchises in rural areas can develop quality service to customers and, create employment, and bring in economic growth for the nation.

Keywords: Challenges, Rural, Franchise, Business, Expansion

View PDF