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HomeFMCG/Retail FranchiseBursting MYTHS about DMart Franchise - Cost & Profit

Bursting MYTHS about DMart Franchise – Cost & Profit

India’s retail sector is immensely huge, and finding a lucrative brand to partner with is certainly thin. With the likes of Reliance Smart Point, JIO Mart, and other popular stores operating their own outlets, DMART is certainly a brand that has grown extensively in the last few decades.

The bulk purchasing power, self-operational capabilities, rent-free stores, and what not—these fabulous features of every DMart store haven’t only given them an edge over their competitors but also given an exciting return to their equity investors.

If you have heard of its franchising opportunity or, by any chance, are looking to partner with them, you should definitely devote your precious time to reading this informative piece.

DMart Franchise Opportunities
  • Brand: DMart
  • Founded: 2002
  • HQ: Mumbai
  • Industry: Retail
  • Founder: Mr. Radhakishan Damani
  • No. of outlets: Over 338+
  • Expansion: Self-owned and operated
  • Franchise: No
  • Traded in Stock Market: Yes

Overview of DMart Franchise

Overview of DMart Franchise

Founded in 2002 by one of India’s renowned stock market investors, Mr. Radhakishan Damani, DMart is a chain of hypermarkets and supermarkets in India, offering a range of grocery and household items at affordable prices.

Primarily, the chain is owned and operated by Avenue Supermarts Limited (ASL), which has more than 338 stores across several towns in India.

Well, before starting DMart stores, Mr. Radhakishan had deep experience in the stock market, which has also helped him make a fortune.

The chain is most popular and renowned as a one-stop supermarket chain that stocks home utility products, including food, toiletries, beauty products, garments, kitchenware, bed and bath linen, home appliances, and more, available at highly competitive prices.

In 2017, its operating firm, ASL, went public, and its IPO was regarded as one of the most successful and profitable in India’s share market history.

Its strong financial performance, unique business model, and bulk purchasing and stocking power have helped the chain establish itself as one of the largest retail chains in India.

According to the latest information and official website, Avenue Supermarts operates its complete chain of DMart stores through its own network of self-operated outlets and doesn’t offer franchise opportunities to independent investors or entrepreneurs.

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Key Facts on DMart

Sr No.TypePublic
1Trade NameDMart
Avenue Supermarts Limited
(@BSE &@NSE)
2IndustryRetail
3Founded2002
4Founders Or Parent CompanyMr. Radhakishan Damani
5Corporate HeadquartersMumbai
6Number of locationsOver 338 stores
7Area servedPAN India
8ModelSelf Operated,
Not a Franchise
9Item offeringA Range of household products
10Revenue₹ 30,353 Crores (FY22)
11Websitehttps://www.dmartindia.com/

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What are the USPs of the DMart franchise?

DMart USPs
  1. Unique Business Model:
    • Unlike other small businesses that rely mainly on selling their franchises for store expansion, DMART focuses primarily on low-cost operations and high inventory turnover, helping to reach a wider audience.
  2. Self-owned and operated business:
    • To be specific, all of the DMart stores are owned and managed by the company itself. With none of their locations being franchised, DMart strategically plans to open their outlets at high-traffic locations.
  3. One-Stop Stores:
    • DMart has built a reputation as a leading retail chain that caters to a wide range of affordable household products, such as groceries, home appliances, clothing, and much more, under a single roof.
  4. Robust Supply Chain and Bulk Purchase Power:
    • With a legacy spanning nearly two decades, DMart has certainly mastered its niche. Additionally, as the franchise primarily operates as an independent entity, it gives them an extra layer of security and benefits in managing their stores and maintaining proper inventory.
  5. Tends to avoid extra expenses:
    • Believe it or not, rents are the major expenses that can entirely disturb the net margin for any retail store.
    • To avoid these, DMart prefers to buy the premises instead of renting them.

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Does DMart franchise in India?

Unfortunately, DMart doesn’t work on the franchise model, and neither has any plans to do so in the coming years. The chain has been one of the pioneer retail brands in India that has continued to operate as a sole entity since its establishment.

If the current statistics are taken into consideration, DMart has over 338 retail outlets across several Tier 1 and Tier 2 cities in the country. Though one can’t become their approved DMart partner, one can become their supplier or pickup point operator (discussed in the upcoming section).


How much does a DMart franchise cost in India?

DMart is a home-grown brand that currently competes with a few well-established and gigantic retail brands in India.

Though DMart is a publicly listed brand and anyone with a legit DEMAT account can buy their share and become their partner, the chances of owning their franchises are completely negligible or nil.

Over the years, DMart has opened multiple stores, and as land and labor costs have skyrocketed, so has their initial investment capital.

As per the estimate, DMart usually spends around ₹2 crore to ₹5 crore, excluding the land cost. And obviously, managing the DMart store and its employees, including the store planning, inauguration, and making it a successful venture, requires immense expertise and managerial skills.


Is DMart Franchise profitable?

Are DMart Stores profitable?

To understand the DMart franchise profit margin, one needs to understand their working and earning model.

On digging further into its annual report, we found that there are primarily four sources of income for DMart:

  1. Revenue from store’s operation
  2. Earnings through their food plaza
  3. e-commerce platform (Online and multichannel operations)
  4. Retail trades (engaged in packing and selling)

For fiscal year 2022, DMart posted a total income of ₹30,493 crore, a significant increase of nearly 270.8% on a yearly basis. The majority of income was generated from the store’s operations, while other units also saw a significant rise in revenue.

During the same fiscal year, the chain planned to open 50 additional full-fledged stores. With all this happening in the limelight, the chain also strengthened its mini model by inaugurating its two miniMax stores in Mumbai and Hyderabad.

Therefore, on estimating its net profit margin, which was nearly ₹1616 crore for the revenue of ₹30,493 crore, you’ll realize that the net margin for DMart franchises is pretty impressive, which stood around 4-5%.

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How to Get DMart Franchise?

Since DMart does not run any franchise programs, no one can apply to be a franchisee. In contrast, DMart does invite certain applicants for Suppliers and Landlords to propose their products.

Register as a Supplier:

If you have a quality product and want to have a long-term partnership with an esteemed chain, then consider filling details as a supplier.

Register as a Landlord:

If you own a property that you like to propose for sale or rent with DMart, then consider filling details as a landlord. Do make sure that plot size should be at least 20,000 sq feet.


The Editor’s Thought

The founder, Radhakishan Damani, who started with a single storefront in Maharashtra, had a clear vision and strategy to disrupt the entire Indian retail sector, which mainly revolved around focusing on selling more at low margins.

It is also true that India’s retail sector is currently growing at a rapid pace, and the emergence of brands like Reliance, IKEA, Spencers, and other value-focused retail chains will definitely give tough competition to DMart.

But DMart has its own advantage, and that is its self-owned, rent-free retail stores. Where other brands will burn out their profits on these expenses, DMart will continue to acquire spaces and expand its presence across other markets.

Additionally, DMart is a debt-free company, and all the expansion plans are managed through its internal cash. And you all know how long a debt-laden company can really survive.

To sum up, DMart neither sells its franchises nor has any plans to do so. It’s a publicly traded company, and you can become their official partner either by buying their shares, renting out your property to them, or becoming their supplier.

Other than that, there is no way, and anyone promising you to offer their franchises is purely fraud, nothing more than that.

Good Luck!! Happy Franchising!!

Want to explore more? Then check out below franchising opportunities.

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FAQ

  1. Can I Get D Mart Franchise?

    No, DMart does not offer franchising programs. Nevertheless, you can submit an application to become a supplier or register as a landlord to sell your products at DMart or lease out your property to DMart, respectively.

  2. Does D mart give franchise?

    Unfortunately, DMart doesn’t offer franchises; instead, you can become their partner by owning some of their publicly traded shares.

  3. What are DMart Pickup Points, and can I take a franchise for this?

    As the name states, DMart Pickup Points are specific locations to collect your online order without paying any delivery charges. One can choose a convenient time and date to pick up their order.

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