Gaurav Marya (34), started his first business at the age of 16 and over the years has started and sold some 15 other businesses ranging from mobile phone, career advisory, restaurant and entertainment businesses. It was not until the age of 24 that Gaurav discovered his real passion in life – franchising. He was first exposed to it while on a business trip to the United States in 1998: franchising was the buzzword there and Gaurav dreamt of seeing similar happenings in India. The dream turned into a reality in 1999 when he formed his own company. Today he is the main force behind India's largest integrated franchise and retail solution company, Franchise India Holdings Ltd. (FIHL).

Marya admits that while he has run several businesses, some have been hugely successful and some not so successful; but the learning and domain knowledge he has acquired has been tremendous. This has helped him share what he's learned and has given birth to his consulting career. He has interacted with over 25,000 budding entrepreneurs with the focus on helping them select and meet the challenges of start-ups. His forte of consulting success has largely been in creating a win-win partnership between the channels and large organizations. He has offered consultancy to over 250 large and small corporations including the Gitanjali Group, Emami, Videocon, Landmark Group, Tata Steel, Unilever India, Levis, Welspun …

Shiv Khera, the noteworthy motivational speaker of India, dubbed Gaurav as "Father of Indian franchising" in 2004 at one of India's biggest franchise forums and it is the title which has remained with him ever since.

Non conformist, confrontational style…

Marya is widely admired for his non-conformist, confrontational style of management and aggressive marketing business tactics. Marya has also chaired several global business forums on franchising and retail. He is the author of the bestseller book on franchising, "The Science of Reproducing Success."

Excerpts from and interview with Marya:

A debt-cautious generation giving way to an aspirational one

IE: How do you compare the franchising industry in India vis-à-vis other nations?
Gaurav Marya: After a year of slow-down and financial crunch, the Indian economy is reviving from the last quarter of 2009. The middle class has never had it so good, with plenty of options, credit available in abundance and at competitive rates. There has been a change in mindset; a flamboyant generation is gradually replacing the debt-cautious.

Franchised operations are becoming more popular in geographically vast and culturally diverse nations like India, as franchising helps to overcome the difficulties posed by having a chain of company-owned outlets.

In India, the franchising industry received a fillip during the 1990s due to the opening up of the economy. Sales from franchised business have grown at an average rate of 25 to 35 per cent compared to a growth rate of the economy of 6 to 9 per cent. India is a self-governing and competitive territory for doing business. Franchise companies enjoy economies of scale. Based on the successful companies that have enjoyed handsome financial gains since the silent franchise boom during 1990, the future of Indian franchise appears bright.

India is on the cusp of something big. There is the potential for an increasingly powerful internal consumption dynamic, an ingredient missing in most other Asian development models, including China. Vigour in private consumption is a more powerful growth leverage compared to investment-led lever.

The Indian government is taking keen interest in the development of franchise business and is considering enacting franchise laws.

Still in the early stages…

IE. How is the climate in India in terms of franchising options? How big is the market? How do you further accelerate growth in this sector?
GM: Franchising is in its early stages in India. It has become increasingly popular as a means of doing business in recent years. As early as in the 1960s, international soft drink and hotel franchises arrived in the country; but in 1977, government put restrictions on foreign brands; these gradually started re-entering India around mid 1980s. In 1991, as the market opened, foreign franchises started coming though it faced many hiccups along the way.

Franchising became a popular method of doing business within India with the franchiser granting numerous unit franchises. This has been the case in respect of IT education; then there are local food chains, health, fashion and lifestyle businesses. It took some time for international franchises to become acceptable. Indian businesses initially could not understand why the Indian party had to make all the investments and on top make hefty payments in foreign exchange to the master- franchisers.

IE . You have been in the market for a decade now. How do you look at competition?
GM: Franchise India, in the working span of 11 years, has established itself as an authority on franchising, licensing, retailing, real estate and marketing, with well-integrated divisions catering to a large clientele. We offer comprehensive end-to-end solutions to our clients through our strategically formed divisions and this is our core strength. No one else in the industry offers such services under one roof. We do have competition emerging in different verticals like media. We believe that to hold on to the leadership position, it is important for us to hold on to innovative thinking and maintain well-integrated systems. We feel that competition in the industry is healthy. It helps all the stakeholders. Till date, Franchise India has successfully engaged 90 per cent of the total domestic brands present in the market. The turnover of the group is Rs 48 crore.

More franchises in the pipeline

IE: Any further deals in the pipeline? Where do you see opportunities?
GM: From deals perspective, each division of FI is well-engaged and has lot in the pipeline such as 3M, Sumeet, Lamborghini, Manchester United, Kenny Rogers, Wheat, Guinness Book of World Records, Pampered Girls, Beverly Hills Country club... Our core business and forte is in the franchising and retail domain only. The SME sector contributes to a major part of our economy and great potential for retailing and franchising. With the burgeoning retail sectors in India, franchising is now becoming more and more popular with small entrepreneurs who want to start their own business because of its "almost" risk-free nature of the business. Franchising had expanded its stakeholders and is now benefiting not just franchisers and franchisees but consumers, franchise professionals, government, franchise suppliers and many others. SMEs are also responsible for driving innovation and competition in the industry. Globally SMEs account for 99 per cent of business numbers and 40 per cent to 50 per cent of GDP.

IE: Would you look at inorganic growth? Would you look at diversifying into other service offerings?
GM: Yes! We definitely would be looking at the inorganic way to grow by exploring international acquisitions, capitalizing on our competitive and efficiency advantage. There is immense potential in Australia and Europe where operating costs are too high! India is most efficient in providing cost-effective systems. We would also look at acquisitions in other developed countries like South East Asia and Africa this year.