My Dollar Will Go Franchise Again

(Saturday, May 31, 2008) - The US-based discount retail chain My Dollar Store (MDS), which started off in India rather "unsuccessfully" with a franchise model, may revert to the same, but with a twist in the gambit this time around.

The industry buzz is that the 50-odd MDS stores slated to be rolled out in this calendar could all be franchisees. However, now, sources said, the retail chain is making sure of three aspects — whether the franchisees have their own property, their expectations on the returns on their property and the location.

Soumitra Ghatak, CEO, MDS, said: "We are open to opportunities, if the expectations can be set right."

A retail analyst said the franchise model will help the retail chain expand its footprint in India and, more importantly, will ensure that its resources are shared.

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When MDS started out in India a few years back, the franchisee model stumbled resulting in brand dilution. The chain re-evaluated its strategy and realised that the typical franchising method as followed in the US was not resulting in a proper brand communication to the consumer.

MDS was then aiming at a more upscale consumer. Consequently, it felt there was a need to change its business model by owning most stores.

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