New Delhi, March 25: Franchising as a way of doing business has arrived. Essentially a business model, the franchising industry in the country is estimated to be around Rs 10,000 crore per annum and growing at the rate of 25 per cent annually.

A boomtime for the franchise model of business is being predicted in a latest study conducted by TNS India, the Indian operation of the US-based marketing research company, along with Franchise Plus, a new bi-monthly print magazine that has just been launched by Exchange4 Media, a media and advertising portal.

Franchise Plus editor Vinod Behl said the maximum chunk of the franchising cake is cornered by the education sector, at 40 per cent. Next in line are retailing with 30 per cent, food and beverage with 12 per cent, healthcare with 10 per cent and professional services at 8 per cent. These are the main domains that include several sub-domains, said Behl.

The study says there are more than 1000 franchisors in India today, spread across sectors like education, retailing, food and beverage, professional services and healthcare.

Experts say that franchisors are ready to put their money in the highly profitable education sector as poor government spending and lack of adequate infrastructure have hampered programmes in this sector. There is a big demand for objective-oriented education.

To fill this void, companies have come up with franchisee model of institutions in information technology (IT), primary, preparatory, finishing and vocational schools, the study said.

Market analysts said in the food and beverages sector, the returns are quite high and, along with private and career-oriented education, it is one of the fastest rising areas in franchising.

The study points out that 12 per cent of the franchisors are in the Rs 50-100 crore bracket, while some have a business turnover of over Rs 500 crore. Also, 40 per cent have international-level operations, while 42 per cent operate at the national level.

The survey for the study was based on face-to-face interviews with franchisors and franchisees in Delhi, Mumbai, Bangalore and Chennai, with annual turnover between Rs 10 lakh and Rs 500 crore.

Franchising as a business model in India is prevalent from the 1970s but the growth has been seen only in the recent past.

“Driven by a resurgent economy, booming retail markets and increasing consumer spending, franchising has established itself as a high-growth business in a short time,” said Behl.