Friday, June 17, 2011

Taking a Play School Franchise? Beware...

Have you heard of the "Baby Boomers"??? This referred to the people born just after the end of WW-II in the next decade or so which provided a sudden spike in the world population. (Refer wikipedia http://en.wikipedia.org/wiki/Baby_boomer) OK...so what?

In a freakonomics inspired article, I will try to connect my post title to the above topic...so here goes...

Baby Boomers were not just an event but a whole phenomenon specially in Europe and America. As these babies reached various stages in life - namely teenage, adoloscence, marriage etc etc they resulted in expansion / creation of industries which were either non-existent or did not have much relevance before then. The marketeers had "reinforced a sense of generational distinctiveness" into the generation and resulted in getting huge profits for themselves. Of course the parents stopped the production plants and the population explosion was halted...

Something similar happened in India around 10-15 years back. Its called "Information Technology". The phenomenon was huge and within just few years, every middle class family had some relative who had graduated and then gone to either Bangalore or Pune and was working either "in software" or "in BPO".

These ladies and gentlemen had very similar backgrounds. Their parents had held either government posts or had a small business of their own. They had been brought up with the constant "get settled" ringing sound in their ears. They had seen the "neighbour's son" going to America and making a fortune. They had tried their best to study and get good marks so that they could also follow that neighbor's son...and then suddenly Mr.Narayanmurthy and his counterparts elsewhere had blessed them with the IT Revolution. Not only did these people start dreaming of having a "well settled" life and be what their parents had always hoped they will be but they also realized that they could get a lot better for their kids... They had enough to spare to see the children getting good education and then possibly going on to do big things....

The result of the IT revolution???

  1. The Mall culture boomed. I still remember the first time I went to PVR Anupam in Saket, Delhi in 1994 and realized that it had 4 halls in one place...AND there was a pizza parlor and few other fast food eateries on the ground floor and I felt....WOW!!!! Again, I came to Bangalore in 2006 and possibly the only few places we could go to on weekends were Forum mall / Garuda mall / Cunningham road. Within 5 years, there is a mall on every corner...I can see one from the balcony of my apartment! Of course, most of these constructions and paper works had started some years back.
  2. McDonalds and KFC's mushroomed. Yeah....again I will attribute it solely to the tremendous spending power of the young crowd. They got what they wanted and these were the "in" things....so was your next door CCD which is now as frequent in Bangalore (and Kolkata and Mumbai and Delhi and even to some extent in Guwahati) as a mom & pop store!

Then what happened..? As these were developing, the "IT folks" started getting married. And who better to get married to than someone who understands your work as well as you. Hence marry "Renu aunty's daughter who is also working in Bangalore" (as told to me by a friend who was reciting his mom's statement)...

And up came the 2BHK (Bedroom, Hall, Kitchen flats) and the 3 BHK apartments in multistoreyed "societies". These provide amenities like parking for your car, security and if you are planning a little upper class lifestyle - a clubhouse with maybe a swimming pool, gym etc etc etc....and of course a play area for your kids. Initially these were available for prices as low as Rs.30 lacs which have now climbed up to a crore or more for the place within 5-6 years!

What next? These are the current phenomena which have been growing rapidly...:

  1. Play Schools...popular play schools are now distributing franchisees like they were available at a dime a dozen and they are finding enough suitors as well who are willing to invest in their own business. This started around 8-10 years back (around the time the first "IT folks" were getting married and having their kids???)
  2. Kids' birthday party theme based companies (or whatever I may call them)....you get everything your kid needs here...and not just for the parties, even international children brands are jumping into India now.
  3. International Schools which are gaining rapid popularity for those dreamy eyed parents who want to give everything that they could not get for their children.... Walking past some houses yesterday, I actually saw an "International School" inside a 2500 sqft apartment!!!!! (It was my inspiration for this article so I should not complain)

Will this phenomena stick? Going by past record, I will say it definitely will move on to something for teens maybe in another 5 years......and marriages in another 10-15......

So will you like a Play School franchise? Or maybe open a marriage hall in the same location to cater to these "IT BOOMERS"...?

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