PROPERTY MONKS PHASE 1

REPORT
ON
REAL ESTATE FRANCHISE MODEL
SUBMITTED BY
NAME ROLL NUMBER MOBILE NO

SAGAR WARGHADE 2013PGP454
9584255
HARIHARAN A 2013PGP151
509099
ARUNMO!HI G 2013PGP0"
95891"8393
PURBALI DAS 2013PGP29 903"29305
DATE# 11 $%&' 2014
INTRODUCTION
REAL ESTATE FRANCHISE
The real estate sector in India is a highly industrious sector that not just contributes in the
gross domestic production but also in employment generation. Even the Government of India
has accelerated the growth of real estate sector by opening the doors to Foreign Direct
Investment (FDI). Besides this, the increasing industrialization, urbanization and
outsourcing businesses have necessitated huge demands for the commercial buildings and
urban residential areas. These rising demands have generated huge franchising
oort!nities in the real estate sector. any well!"nown realtors have also recognized the
potential of franchising, thus, finding innovative ways to generate profitable real estate
franchise opportunities.
In the real estate sector as elsewhere, franchising involves the sharing of intangi"#e caita#
such as trademar"s and goodwill between the franchisor and the franchisee. In the real estate
industry, nationa# tra$emar%s or brand names are useful to consumers because it is difficult
for buyers and sellers who are unaware of a local housing mar"et to obtain information on the
#uality of services available from local bro"ers. Instead of trying to gather information on
their own, many buyers and sellers rely on a national trademar" as a guarantee of minimum
#uality of service. $or this reason, the value of franchise affiliation to the real estate bro"er
hinges on the #uality it &g!arantees' to buyers. Given the shir"ing problems inherent in any
profit % sharing arrangement, franchisors prefer to charge a lump!sum franchise fee &e(!a#
to the e)ecte$ resent va#!e of the stream of rofits& there would be no ongoing payment
from the franchisee to the franchisor'. (nd ro*a#t* fees are often included along with a
fi)ed!fee in many franchise affiliation agreements. $ranchise opportunity in real estate
includes
*ousing +roperty
,ommercial +roperty
-enting service
.easing service
+roperty selling etc.
/ome of the real estate franchises in India are -e0a) India, ,entury 12 India, .3 *oo"er,
+robro, 45 (cres, $ranchise 6ing, and a) India +roperties. 7e have considered Re+,a)
India franchise in real estate sector and -reen Tren$s in non!real estate sector for the
analysis of franchise "!siness mo$e#.
-REEN TRENDS
Green trends focuses on providing ersona# st*#ing an$ "ea!t* so#!tions to everyone in the
family. It started in 1881 and it has become one of the biggest organized salon retail chains in
India. Green trends have segregated the franchise operations in to various departments. (ll
the departments wor" collaboratively for successful operation of the franchise.
The Teams.
Project team:
9fficials from the organization will investigate the viability of the franchise in
particular location.
They involve in site selection and analyze its feasibility
They help in the interior salon design and layout
They also involve in estimating the startup costs for the franchise
Operations management:
+rimary wor" of operations team is to
o +ut in place operations system and procedure
o T: of people, resources and materials.
o +rovide +9/ support
o /et!up to end database management system
o +rovide training in ,-
Supply Chain Management:
The team focuses on selection of suppliers for the products used. They also manage
the inventory and evaluate the costs associated with it
Maintenance team:
-epairing and servicing of all the instruments used
,hec"s the cleanliness of the salon.
Marketing team:
( combination of nation/i$e romotions (ATL) and #oca# store romotions (0TL)
ta"e place periodically every year. $ranchise will ta"e the responsibility of BT.
promotions ;,osts and operations<
Franchise support and business development team:
They are the first point of contact for any of the franchise #ueries and complaints.
Training and staffing:
Employees will be recruited by the franchisor. Targets will be fi)ed for the employees
and will be continuously monitored.
$ranchise has no rights in recruiting0terminating a service provider.
Training ;including soft s"ills< will be provided to all the employees periodically
Franchise se#ection rocess.
$ranchise should have the following re#uirements such as financia# "ac%gro!n$1
"!siness histor*1 acco!nts an$ a$ministration caa"i#it*
(pplicants fulfilling the re#uirements will be given an orientation program about the
business
( non!refundable amount e#ual to 234 of franchise fee should be paid as
confirmation fee
5 month re6oening co!rse will be conducted in any of the outlets for the new
franchise
The teams from green trends help in setting up the franchise and operation consultants
guide until the outlet is launched
:uality
products
Employees
Brand image
(dministration
Em#o*ees
The service providers interact directly with the customers. /ales depend on how they interact
and how efficient they provide service. *ence the employees are trained well in Trends
academy run by the organization
0ran$ Image
,avin"are, a successful $,G brand is well "nown for its brand image among the
customers. The company has pioneered the concept of 7Fami#* sa#ons8 in India with its
specialist brands % .imelite and Green Trends. The services offered across all the salons are
standardized.
9!a#it* ro$!cts
The products used are of high #uality and the service offered is top notch. /uccessful brands
li"e .oreal, .a"me, -evlon are used.
A$ministration
The successful operation of the franchise lies in its a$ministration. *ow service is provided,
how employees are monitored, how revenue is shared, how technology is leveraged etc. are
some of the chief #ueries which has to be administered periodically
Commission+ Ro*a#t* fee
No amo!nt will be collected from the franchise for the initial month. $or the ne)t 4 months,
it is :4 and for the ne)t 21 months it is 234 and after that it is 2:4; This is followed to
help the franchise recover their fi)ed costs involved. The membership is valid for : *ears and
can be renewed later for a considerable amount subject to negotiation.
The "ran$ fee an$ ro*a#t* fee has to be paid mandatorily for south Indian franchisees. In
north India, the brand has not penetrated well and hence the fees paid can be negotiable.