There are several reasons why potential investors are looking at Nike for future endeavours. Some benefits to owning a Nike Store include:
Nike is a minimum-risk entry into the growing Sportswear, footwear, athletic apparel and innerwear retail market and the potential owner has a high chance of succeeding as the market continues to diversify. Very few markets in India have such a potential for growth as does semi-luxury Sportswear, footwear, athletic apparel and innerwear retail for men and women.
An unknown store will surely have a hard time attracting the attention of customers in today’s competitive atmosphere. But Nike itself is a huge brand. Operating under this brand will help the owner enjoy an automatic sense of trust and commitment from the existing customers of Nike.
- Receiving proper training, support and guidance
Nike provides proper training to the owner as well as listed employees before the store starts operating. Even during daily operations, franchise support is available 24/7 and routine guidance is provided to owners across the country. These owners also enjoy the benefits of high quality data analysis used by Nike itself.
- An affordable franchise option
When it comes to big names in the Sportswear, footwear, athletic apparel and innerwear retail market, no other brand of this scale has come up with a franchise option that is this affordable. Nike Franchise Store can be opened by new and young enthusiasts who have the capacity to invest a lot of effort and time but only little capital.
Starting a Nike Franchise- Eligibility Criteria
The eligibility criteria for the Nike Franchise Store are as follows:
- Personal Details: Personal details include name, professional and educational qualifications, address proof, ID proof, passport size photograph, email and mobile number.
- Bank details: General bank details like account number, PAN card etc are required. It is also advisable to keep an account of your credit score and available funds handy for inspection.
- Proof of meeting requirements: Franchise requirements are listed below. Make sure you meet all the requirements before applying.
- Store ownership/tenancy documents including lease agreement. (A picture of the shop is also required.)
- Applicant’s GST number
Requirements To Open Nike Franchise Store:
Nike is going for a brand image that prioritises simplicity and casual comfort. Some basic requirements set by this brand include:
The minimum investment criteria set by Nike is 50 lacs – 1 Crore. The expected cost of investment between setup and product purchase is between 50 to 80 lacs. The company has a set of guidelines that it expects any franchise to maintain as these guidelines reflect through the company really is.
The company has put a lot of focus on the floor area requirements. It is expected that the store should have 1000 to 2000 square feet floor area. The minimum requirement set by Nike is 500 square feet.
For potential owners who don’t have the perfect space ready for a franchise store, the cost of floor area will depend on where the store is located.
Mostly, a good location with readily available customers is preferred by the company.
Nike has a standard franchise agreement of 10 years. The payback period of each unit franchise is 1 years and will be stated clearly in the franchise agreement.
Nike requires each store to have at least three employees. For franchisees, the company encourages having multiple employees, as long as the recruitment is in favour of better management practices. Nike is very cautious about employee costs and prefers to hire individuals with versatile skills and job profiles.
- Basic location requirement
Allocation requirements for Nike are flexible, but the company has been giving precedence to one or two tier cities. Within a city, a locality that has affluent customers willing to pay extra for a good product are beneficial for both the company as well as the individual owner.
All resources that will fulfill the above mentioned requirements must be already available or guaranteed to be available to the owner when they apply for a franchise with Nike.
Nike Franchise Store – How To Invest ?
In order to succeed as a Nike Store, every franchise will need a solid investment, management and growth plan. Nike franchise representatives help new owners develop a solid business plan that can withstand the highs and lows of business.
Building and maintaining a solid investment plan requires experience, knowledge and expertise. The total investment is expected to be around 50 to 80 lakhs.
Nike as an organisation is heavily involved with the initial and routine update of product catalogue for every store. The franchise has to meet the product requirements set by Nike specialists on a regular basis. The owner needs a solid plan to tackle the rising initial costs of these routine changes.
Nike has had the issue of rising employee costs recently. This organisation values the quality of life among its employees but at the same time needs to cut down on the exceeding cost of labour. Work benefits and additional employee benefits can sometimes act as a substitute against monetary solutions.
Just like every other business, in order to succeed the owner needs a proper plan of fund allocation. Even if business funds are loaned for the running of this franchise, a proper financial management technique can swiftly lead to regional growth.
Nike Franchise Profits & Margin:
Nike has promised an initial commission of 40% to the franchise owner. Since this is a popular brand in India today, owners can expect to earn 35% to 45% profit margin on every product in their store. Nike also has the capacity to buy wholesale products at a much cheaper price than normal retailers. As a franchise, the owner will also be receiving products at incredibly low costs.
It is expected that India will soon become the fifth largest Sportswear, footwear, athletic apparel and innerwear retail market in the world and among the top manufacturers of high quality beauty products around the globe. Nike has decided to tap into this amazing opportunity with its fascinating revenue model. The company has maintained that every franchise owner will receive territorial rights to the unit franchise and will also be able to take all managerial and operational decisions.
Conclusion:
The Nike Franchise Store is a great option to build a successful beauty store from which the owner can develop a valuable understanding of this industry and expand their expertise further. In the end, Nike Franchise should be taken up by those who are willing to make medium to large scale investments on their store and can employ highly trained employees.
