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Street Vendor Franchise Model

When we think of franchise, big names, high cost etc. comes to mind. Franchise has been traditionally associated with successful brands; investor seeks to use existing brand awareness, associated brand premium to establish their shops. If you do a quick search on Google, a classic definition that pops up is “a business method that involves licensing of trademarks and methods of doing business” [WIKIPEDIA]

Although big franchise in retail, food, media etc. are famous. But have you heard of franchise at street vendor level!! I will try to explain this by an example from streets of Bangalore.

Panipuri [http://en.wikipedia.org/wiki/Panipuri]

If you don’t know what Panipuri is, please visit the attached link. Basically it is type of snacks. It is available throughout India, although customized according to taste and liking of region.
So when Bangalore started with bang on software development arena, many things happened. Lot of people from northern part of India started working in this city; also there was boom in education sector, lot of engineering colleges opened and along with came huge student population from north India. Now there was market for north India variant of Panipuri. Locals didn’t knew how to prepare it, there were very few authentic shop around which served according to taste buds of north Indians. Someone in the city saw this gap. Hence they started severing Panipuri (North India Style) beside roads and shopping malls. It was instant hit. This lead to start of hidden franchise model for Panipuri. The guy at already famous Panipuri stall started associating like minded people. He not only trained them how and where to put up the stall, but also started supplying the raw materials. Panipuri guys in one area sourced all the raw material from one place, this not only made them keep the taste intact but rule of volume also kicked in and their raw material became cheap.



So two main things happened which is back bone of franchise concept
a)      Sourcing of raw material from single source, hence standardization of taste ( This can be termed as unique achievement of this business, as there is no other food chain in India except few big house like CafĂ© Coffee Day which is able to achieve, single point sourcing)
b)      Using the brand equity of already hit product

If you now visit Bangalore, you can find these Panipuri stalls at almost every nook and corners. Although not all of them are associated together, but if you enquire enough you will definitely find that, he is not alone, but part of group consisting of 10-20 similar vendors, selling at different locations of same locality.

Although these vendors are poor people, they have very well mastered the art of one sourcing the raw material and using the already brand (here taste).
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