Introduction
Venturing into the food service industry in India can be a rewarding endeavor, especially with a well-known brand like Five Star Chicken. Originating from Thailand under the Charoen Pokphand Foods (CPF) conglomerate, Five Star Chicken has rapidly gained popularity in India. If you’re contemplating this franchise opportunity, understanding the associated costs is essential. Here’s a detailed look at what it takes to open a Five Star Chicken franchise in India.
Five Star Chicken in India
CP Foods launched its first Five Star Chicken franchise outlet in November 2012 in Bangalore. By 2013, the brand continued expanding in Bangalore and entered the Chennai market. Since then, Five Star Chicken has grown to over 350 franchise outlets across Bangalore, Chennai, Kochi, Goa, Pune, Mumbai, and Hyderabad. The brand has also tied up with IRCTC for Kerala, Bangalore, and Chennai markets and partnered with key delivery platforms like Zomato, Food Panda, Swiggy, and Ola.
Why Five Star Chicken Franchise?
- Nominal Investment: Requires a comparatively lower initial investment.
- Strategic Approach: Competitive strategies to stand out against established brands.
- Lower Risk and Higher ROI: Promises lower risk with higher return on investment.
- Managed Supply Chain: CP Foods manages the entire supply chain process.
- Training and Support: Extensive training and support to minimize food wastage.
- Established Franchise Model: Currently operates over 350 franchises across India.
- Expertise: Over 27 years of experience in leading food processing.
- Complete Package: Offers a comprehensive support package to franchisees.
Five Star Chicken Franchise Investment Details
The total investment for a Five Star Chicken franchise ranges from INR 9 to 10 lakhs. This includes:
- Franchise Fee
- Equipment
- Interiors
- Branding and Signage
- Refundable Deposit towards Supplies
Initial Investment Breakdown
- Franchise Fee: The initial franchise fee typically ranges from INR 3 lakhs to INR 5 lakhs, covering the right to use the brand name, business model, training programs, and ongoing support.
- Setup Costs:
- Infrastructure and Interior Design: Costs range from INR 10 lakhs to INR 15 lakhs, including furniture, fixtures, kitchen setup, and decor.
- Equipment: Essential kitchen equipment like fryers, grills, and refrigerators can cost between INR 5 lakhs to INR 8 lakhs.
- Initial Stock and Inventory: An initial stock of raw materials and ingredients costs around INR 2 lakhs to INR 3 lakhs.
Ongoing Costs
- Royalty Fees: Franchisees must pay a monthly royalty fee, which is a percentage of the gross sales, typically ranging from 4% to 6%.
- Marketing Fees: An additional marketing and advertising fee is usually around 2% to 3% of the monthly gross sales.
- Operational Costs: These include rent, utilities, staff salaries, and other daily operational expenses. The exact amount varies based on the outlet’s location and size.
Location and Size Considerations
The cost of setting up a Five Star Chicken franchise can vary significantly depending on the location. High-traffic urban areas might have higher rental costs but offer the potential for greater returns due to higher footfall. Conversely, smaller towns or suburban areas may have lower setup and operational costs but could require more intensive local marketing strategies.
Support and Training
Five Star Chicken provides extensive support and training to its franchisees, including:
- Initial Training: Covers operational procedures, customer service, food preparation, and hygiene standards.
- Ongoing Support: Regular updates, marketing assistance, and periodic training sessions to ensure consistent quality and efficiency.
Responsibility of Franchisee
To ensure the success of the franchise, the entrepreneur must:
- Recruit adequate and quality staff two weeks in advance.
- Retain staff to ensure consistency.
- Maintain QSC – Quality of the product, Service, and Cleanliness.
- Be personally involved for 2 to 3 hours per day.
Conclusion
Opening a Five Star Chicken franchise in India demands an initial investment ranging from INR 9 lakhs to INR 10 lakhs, including the franchise fee, setup costs, and initial stock. Ongoing costs such as royalty fees, marketing fees, and operational expenses should also be factored into your budget. With its strong brand presence and robust support system, Five Star Chicken offers a lucrative opportunity for aspiring entrepreneurs in the fast-food industry. Ensure thorough research, a detailed business plan, and adequate funding to successfully embark on this venture.