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Key Strategies/Methods to Set up a Franchise Model in the IVF Sector The franchisor's business model changes to "support" rather than "working" model and market share, brand appreciation, and incomes increase as a result

By Dr Anagha Karkhanis

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The incidence of infertility has increased over the decades mainly due to delayed marriages, increased use of contraceptives, urbanization, pollution, stress, lifestyle patterns - alcohol intake and smoking, PCOS, endometriosis, STIs, stress, obesity etc. 1 in 6 couples face infertility. It is estimated that there are around 27.5 million infertile couples in India and only about 1per cent of these are currently accessing treatment. 2015 saw approximately only around 100,000 IVF cycles were performed.

The Market

The IVF market has grown at a CAGR of 18per cent in the last decade despite this the IVF market is highly under-penetrated with demand being 9 to 12 times higher than the present market, even in big metro cities. We face a serious challenge of high infertility rate and significantly low treatment rates. IVF market is expected to grow at a CAGR of ~20per cent thus estimating 260,000 cycles in the year 2020.

Today most of the retail companies offer franchise which allows for early and easy scale up and faster growth for the individual businessmen, similarly, the market for IVF services in India is growing. In the last few years, some of organised IVF institutes have started franchising their brand to scale up their business but franchising is not an easy method to achieve success for that they need proper strategy and methods. Franchising is a very unique business model and is very different from a traditional business. The main difference is that the franchise holders are self-governing business operators, not workers. This difference makes the franchise a desirable option for an individual clinician who wants business growth and yet does not want to lose the autonomy of self-employment.

Perks that India Offers

Our country offers a lot of latent in the franchising sector. Apart from Indians being very entrepreneurial, franchising as a way of doing business has been well recognized in the market. Franchising in India is at a very budding stage, but this business has clocked the growth rate of 25-30 per cent, the 2nd fastest rising industry. This when married with the expected growth of the IVF industry probably makes franchising a way forward for chain IVF clinics.

To franchise IVF business one needs to create proven methods and proven brand with proper SOP / do & don'ts of business and adopt a different approach as far as the industry is concerned, especially in technology which is the key factor for attracting individuals who are looking for new business who have that sort of a mindset from a very long-term investment point of view. Standardisation in all processes and especially success rates is a crucial factor. The key to an effective franchise operation is the brand itself. Franchisors must have a brand that people wish to invest in and be linked with. The brand should be identifiable, esteemed and suitable for use across different regions of the country. There should be a plan for constant outlay in the brand. Before franchising, one needs to set vision and mission which will get the company moving in the right direction and keep the focus strong as franchise owners are added to the community. Depending on the franchise model IVF business is a high investment with good ROI. Most of the institutes in the IVF industry follow FOCO (franchise own company-operated) model but few are focusing FOFO (franchise own franchise operated), model. Once the business model is ready the company need to finalize the Go to Location and understand the market potential to plan a marketing strategy for both B2B and B2C. Selection of franchise is also a very important factor as apart from doctors non-medical individuals will also interested to invest in this fast growing sector which requires a certain level of quality and consistency and this needs to be mandated by the franchise agreement.

IVF franchising company licenses its Trademarks, Copyright, know-how and established a business model to "franchisees'. These franchisees adopt that business model, including the brand and then function in new marketplaces. The franchisor's business model changes to "support" rather than "working" model and market share, brand appreciation, and incomes increase as a result. A firm should have a clear sales proposition that is imbibed and effortlessly communicated. Whether it be based on value, quality, provision, convenience or whatever - the scheme must be able to be constantly deliverable.

Dr Anagha Karkhanis

Senior Gynaecologist, Infertility Specialist and Director of Cocoon Fertility

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