Jewellers look to franchisees to expand retail footprint

KOLKATA: Branded jewellers are looking at the franchisee route to expand their retail footprint, a strategic turn prompted by the volatility in gold prices and erosion of margins over the past two years.

Rajesh Exports, Gitanjali Group, TBZ - the Original, PN Gadgil Jewellers and others have opted for this route to grow their businesses as the margins in plain gold jewellery have tumbled to 4% from 15-20% two years ago. Higher rentals, which push up the operational cost, also figure among the reasons for choosing the franchisee route, according to jewellers.

The latest entrant in the franchisee business is the Mumbai based TBZ (Tribhovandas Bhimji Zaveri) - the Original. “In today’s world, the brand has to make an effort to go to customers and franchising model is a global tactic to deepen penetration and explore newer markets,” said Prem Hinduja, CEO of TBZ.

“TBZ franchising opportunity is logical for our brand, which is growing faster by leaps and bounds than its distribution. And we didn’t want to limit ourselves with constraints of high investment costs as long as we found like-minded partners who share the values, ethos and commitment to the brand,” said Hinduja.