To broaden the service spectrum, save capex and tap the unexplored growth opportunities latent in mini cities of the country, prominent salon chains of India are optimising their market potential by a co-branding model with existing salons and beauty parlours located in small-town India.
Two of the country’s largest salon chains, Jawed Habib Hair and Beauty Ltd and Naturals Salon and Spa, are of the opinion that small towns offer tremendous opportunities for expansion, provided incumbents develop a viable business model.
Speaking to Indiaretailing, Jawed Habib, CEO, Jawed Habib Hair and Beauty Ltd says, “Through licensing and franchising models, we plan to expand our reach and invite third parties to come join hands with us.”
“Initially, we are looking at Jawed Habib Salons in small cities of West Bengal with a minimum of 2,000 outlets. We wish to change the market completely. The conversion of a small beauty parlour into a brand will add to the vast potential of the Indian market and its latent growth. We are looking at beauty parlours in the smallest of small cities,” he adds.
“Our concept is to impart quality education and even a city with a total population of 10,000 is still viable for us. Starting with West Bengal, we plan to cover the whole of India.”
C K Kumaravel, founder of the Naturals Salon and Spa chain, agrees that this kind of arrangement paves way for salon opportunities in small towns, which are largely on the rise due to the twin factors of increased disposable income and consumers’ aspirations.
“The world has shrunk today and everyone is well connected with television and internet access. This has led to film stars and cricket players exerting strong influences on the way people in small town think and behave,” he notes. “The smartphone revolution is currently on a boom in India today. It has also raised aspiration levels among small-town residents.”
Having said that, Kumaravel cautions that a co-branding model also depends on sourcing the right partner in the right location, otherwise sustaining a franchise model would remain a challenge.