What comes to mind when you want to start a business? For some people, it’s a business plan. Others who are not with it (like me) think about the perfect location.
But undoubtedly, the first thing should be the associated costs. This is especially true when it comes to franchises. After all, you are buying into an already established brand. And if you’re considering taking the franchise route, you may want to know the cost of getting an ice cream franchise.
Well, if that’s your current predicament, you’re in luck. Today’s post explores the cost of setting up a Naturals Ice cream franchise. In so doing, you can make an informed decision about whether or not this is the right business for you.
The first thing you need to do when considering the cost of a franchise is to research the initial investment required. This gives you a good idea of whether you can afford the franchise. Generally, the initial investment for a Naturals Ice Cream Franchise is roughly 12 to 20 lakh INR. Let’s break down this figure to see where the money goes:
1. Brand Deposit (aka Franchise Fee)
A brand deposit is an initial fee you pay the franchisor for the right to use their name, business model, and other resources. The fee also entitles you to exclusive rights to sell the ice cream in your territory.
If you have your eyes on a particular territory, ensure your outlet isn’t within a 7-kilometer radius of a similar Naturals establishment. All the same, for a Naturals Ice Cream franchise, the brand deposit is ₹1,00,000 or 1 lakh (thanks to India’s preferred numbering system).
2. Equipment and Decor
You also need to purchase some equipment to set up your store. These may include a chest freezer, frost top, dipping cabinet, an ice cream display case – the list goes on. The cost of the equipment usually depends on the size and location of an outlet, among other variables. That said, the equipment and machinery you need to run your outlet will set you back roughly 2 lakh IN or 2,00,000 rupees.
To operationalize your business, you’ll need some initial inventory on hand. This is the list of products you plan to stock in your franchise outlet when you open your doors. For a Naturals franchise, your list may include an assortment of ice cream flavors -seasonal or year-round varieties.
Hence, the type of ice cream flavors you plan to sell will invariably impact inventory costs. Overall, expect to spend between 1 and 2 lakh INR on inventory.
To most people, marketing is a necessary evil when starting a business. That means setting aside cash to get the word out about your store. Otherwise, how do you plan to get prospective customers through your doors?
The marketing cost will depend on the type of marketing you plan to do. For instance, choosing a marketing strategy that aligns with your target audience is advisable. That may imply opting for digital approaches such as social media marketing if your target market is the millennial generation. Your marketing spends for a Naturals franchise unit may run between 50,000 to 1 lakh INR.
Training is also a vital component when venturing into any business. To this end, your employees will need training on how to make ice cream ‘The Naturals’ Way’ and handle the equipment. Training may also encompass customer service, product knowledge, and managing your store’s finances.
Naturals recommend you have at least six employees at your outlet. Expect to pay 20,000 to 50,000 INR for training, depending on the number of trainees and duration of the training.
6. Opening Costs
Before swinging your business door open, consider the costs of opening a new store. These can include the cost of permits and licenses, utilities, rent deposits, and furniture. Still, such expenses can vary widely depending on the location of your store. That said, opening costs may run between 1 and 2 lakh INR.
7. Working Capital
This is the money you need to keep the business running daily. It includes the cost of inventory and wages. To keep your franchise afloat, especially at its inception, you’ll need some cash to cater to recurring expenses before you start turning a profit, say three or so months.
And while the amount of working capital often depends on multiple factors, to be safe, set aside roughly 50,000 INR as a safety net. That way, your ship won’t run aground after you start your journey.
For the most part, your costs can vary significantly, as the variables we’ve tackled point out. But provided you have the financial muscle to take on the challenge, a Naturals Ice Cream franchise could be yours for the taking – assuming you meet all the other requirements.