Cars have evolved from being a luxury to a necessity today. With increased disposable income, people are ready to spend on this necessity. This has led to the car industrys current high character. But many potential car buyers can not fulfill the dream due to the high cost of brand new cars and skyscraper rates. Therefore, a bypass car can be more convenient in such situations. Although due to the unorganized actors in the industry, one can buy a truck or a scooter to be a dicey decision.
But with the filing of the organizers and the assurance they received about the condition for the cars, its not just a bad choice to buy a bypass car. Some of the organized trademarks of the previously owned car market are Mahindra and Maruti. Given the increasing demand for proprietary car players in the industry, the franchise route has been chosen. This has added another segment in the automotive industry. Franchising is the best way to further develop and make available this wonderful opportunity to every nook and corner of the nation. Like Jagdish Khattar, Chairman and CEO, Carnation Auto says, We propose that we follow the franchise model as it will provide wider dissemination to our network and help build our brand. This article discusses the franchise opportunity in this new industry and the various players in the sector.
Automobile franchise concept. The market for pre-owned cars in India is dominated by the unorganized players with only 20 percent contributing by the organized players. The size of the previously owned car market is expected to be the same as for new cars, which is about two million vehicles a year. The market is speculated to grow by 20 percent per year over the next five years. According to Yatin Chaddha, VP, Mahindra FirstChoice, the industrys current size is about 2.2 million vehicles per year, that is, the same as the new car market. Due to the thriving economy and rising income for people, the previously owned automotive industry is expected to grow exponentially.
With the input of companies like Mahindra FirstChoice, Popular Car World, Maruti True Value, Carnation and many more, the sector is ready to grow aggressively. Few of these companies (Mahindra FirstChoice and Popular Car World) successfully exert the franchise model to expand their presence across the country while the others (Maruti True Value and Carnation) focus on franchising their businesses to spread across the length and breadth of nation within one near future. As Chaddha says, Franchising is a good option to enter into flourishing business of proprietary cars.
Enter the previously owned car market. Most of the organized actors in this domain have dared into the negotiated car sales with the mission and vision to give consumers a wide selection, to make it professionally organized by providing transparency, quality and trust. Supports this, says Chaddha. A customer looking for a previously owned car had no choice of cars, could not be sure it was technical that the car was shown that he could not control the background or legality of the previous owner and did not have the benefit of handling an organized player at national level. It was this need gap that led to the start of Mahindra FirstChoice. While Maruti True Value channel its expertise to ensure transparency and fairness about its transactions in previously owned cars, which helps to expand its relationship and emotional relationship as it thinks about its customers.
Ability. With the efforts of the various actors, the sector offers huge growth potential not only for the franchisors, but also for the entrepreneurs aspiring to be part of this new sector. As Chaddha says, because of their knowledge of local conditions, franchisees can greatly assist in areas such as personal involvement, promotional actions, labor planning and retention, etc. If you also weigh your prospects into this promising industry, franchising is that best option to get you started with your own company of previously owned cars. All you need is a sound economic background to be able to finance an investment ranging from Rs 20 lakh to three crore depending on the outlet area. Mahindra FirstChoice requires an area of 500-1,000 sq ft along with a 15-20 car parking space for its franchise store while for its supermarkets it requires an area of 25,000 - 40,000 sq.m. with an investment of Rs one to three crore. However, the criteria for choosing car franchisees differ from company to company.