There were a time when we had limited apparel brands in the market and customers had to rely on the local market or trusted vendors for their purchases, but not anymore, thanks to the entry of Zudio.
Zudio, owned by the Tata Group, provides a variety of affordable and premium clothing and has expanded its presence to over 350 outlets in just 7 years.
If you have been looking for a complete guide on Zudio Franchise and have planned to venture into the world of the apparel industry, then you have certainly landed on the right path.
Through our perfectly curated article, which includes the research and key findings from the annual report, renowned media houses, and the official website (obviously), we’ll shed light on its estimated capital requirement, potential margins, and the legitimate process to become one of their approved partners.
- Brand: Zudio
- Founded: 2016
- Franchise model: FOCO
- Space Required: 6000–8000 sq. ft.
- Franchise fee: Rs. 10 lakh
- Security Deposit (6-month rental): Rs. 29 lakh
- Stamp Duty and Registration: Rs. 20 lakh
- Consultancy/Brokerage : Rs. 2 lakh
- Total Investment: Rs. 2-3 crores
Understanding apparel chain growth prospects:
The textile and apparel industry is one of the leading segments of the Indian economy, the largest source of foreign exchange earnings for India, and employs more than 38 million people.
It contributes 4 percent to the gross domestic product (GDP) (a must-read document if you are looking for apparel industry future growth prospects), 20 percent to industrial output, and slightly more than 30 percent to export earnings.
The rapid expansion in the apparel industry is driven by the rise in disposable income, regular changes in clothing trends, affordability (various brands are offering clothes at reasonable prices, which weren’t the case earlier), and much more.
According to the India Brand Equity Foundation, the Indian textile and apparel industry will reach US$ 190 billion by 2025–26, exhibiting a CAGR growth of 10% during 2020–2025.
Zudio Franchise Snippet
Zudio is one of the rapidly growing subsidiary brands of Trent Group (owned by Tata) in India, known for offering affordable and trendy look-and-feel fashion apparel for men, women, and children. They have a strong presence, with more than 352 outlets across 119 cities.
It provides a range of products aimed at young, value-conscious customers. Surprisingly, the majority of the stores are located outside the city and offer moderately priced western-style clothing starting at around Rs. 300–400.
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Table of Contents
Overview of Zudio Franchise
Establishing its first outlet in Bengaluru(India) in 2016 as a subsidiary chain of the Trent brands, Zudio is one of the fastest-growing reputed fashion and apparel chains in India. Their offering includes clothing, ethnic wear, lounge wear, footwear, and other varieties for men, women, and kids.
They have a strong presence of more than 352 outlets across 119 different cities, thanks to their eminent marketing tactics, franchising model, and sophisticated outlets offering best-in-class service to their consumers.
With the added advantage of offering apparel and accessories since 1998, this has enabled the franchise to capture a substantial market position in this segment.
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Why Consider Owning a Zudio Franchise?
Considering the future growth potential of the fashion and apparel industry, starting a Zudio outlet will be especially beneficial to its franchisee unitholders. Now, let’s start with the reason to own this apparel retail franchise:
- Reputed brand and recognition:
- As mentioned earlier, the chain is a subsidiary brand of parent chain Trent, which takes care of the entire business activity.
- Within a few years, the chain has expanded to more than a hundred outlets across various cities.
- Affordable product range:
- The affordability of its products allows them to target young and value-centric consumers.
- These customers also enable them to build a loyal fan base and ultimately generate an impressive profit margin.
- High Growth Expansion:
- The franchise operates in a rapid-growth industry and offers a proper expansion plan, which enables the unit holder to run the business hassle-freely.
- As per the latest report, Zudio has a future expansion plan to add more outlets, taking it to a total count of 300+ by FY22.
- Fixed revenue share:
- Zudio operates on the FOCO model and offers a fixed revenue share of around ~16% revenue share and 12–15% IRR.
- Additionally, a lump-sum investment and a fixed revenue share would be profitable to franchisees.
- Emphasis on Outlet Scalability:
- In its retail network, Zudio has a targeted focus on building up new franchise locations and new brand ranges.
- Achieving Sales through the Omni-Channel Model:
- With the help of the omni-channel model, the franchise has generated an impressive profit margin for its chain.
- According to the latest financial report, Zudio’s parent chain posted an outstanding profit of 114 crores in Q1 FY22.
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How much does a Zudio franchise cost?
It is also important to mention that the initial investment in Zudio retail includes various components like franchise fees, inventory costs, the outlet’s construction or renovation expenses, and working capital.
Irrespective of other franchise businesses, Zudio requires a little extra investment to own its outlet.
According to its latest annual report, to become an approved Zudio franchise owner, one needs to have an initial investment of ₹3 Crore to ₹4 Crore for a store size of around 6000–8000 sq. ft.
Below are the cost and other details associated with the franchise:
|Essentials||Capital required and other details|
|Key product offerings||Fashion and Apparel for Men, Women, and Kids|
|Space required||Min. 3000–6000 sq. ft.|
|Franchise Model||FOCO(franchise-owned company operated)|
|Year and City of Establishment||2016 in Bengaluru (India)|
|Number of franchise outlet and City||Over 352 outlets in 119 cities|
|Capex Required||Rs. 3–4 crores|
|% Revenue sharing||~ 16%|
|Franchisee Fee||Rs. 10 lakh|
|Return on Investment||30-36 months|
|Return on Capital Employed||60% at Store level|
|Internal rate of return||12-15%|
|License Period||7 Years|
Fashion and Apparel franchise:
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How much is the Zudio franchise profit margin?
As stated earlier, the Tata Zudio franchise operates on the FOCO model and offers a fixed revenue share of around ~16% and 12–15% of the internal rate of return on the lump sum invested.
Nevertheless, the profitability of any apparel franchise like Zudio will depend on numerous factors, such as location, store size, and average customer footfall and obviously the operating capabilities of the outlet owner.
Let me elaborate more on this,
Margin sharing on FOCO Model
|Total Gross Margin||38%|
|Franchisee Margin (FOCO)||16%|
Per store metrics for Zudio franchise
|Size (sq. ft.)||6000-8000 sq. ft.|
|Investment (INR/sq ft.)||Rs. 2000/ sq. ft.|
|Size (in sq. ft. for calculation)||6000 sq. ft.|
|Rent/month/sqft (INR)||Rs. 80 per month per sq ft|
|Capex||Rs. 1.2 Crores|
|Franchisee Fee||Rs. 10 lakh|
|Security Deposit (6 month rental)||Rs. 29 lakh|
|Stamp Duty and Registration||Rs. 20 lakh|
|Consultancy/Brokerage||Rs. 2 lakh|
|Total Investment (per/store)||₹3 Crore – ₹4 Crore/ per store|
The above tabled data will provide you an exact earning and cost involved in setting up a Zudio outlet in your city.
The franchisee bears rent and electricity costs, while the franchisor manages the entire operations, with expenses like an employee salary, inventory management (transportation, discount, shrinkage, etc.), housekeeping, security, and all day-to-day expenditures.
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Is Zudio Franchise Profitable?
In general, the profitability of a Zudio outlet may depend on a variety of factors such as location, competition, management, marketing, and more.
Nevertheless, considering Zudio’s robust franchise network, TATA group backing, Affordable and wide range of apparel offerings, extensive marketing support, and emphasis on outlet scalability, one can anticipate a fixed revenue share of around ~16% in the FOCO model.
Furthermore, according to a report published by the renowned brokerage platform, 5 Paisa, Zudio, a subsidiary unit of the Trent Group, contributes to 40% of its revenue.
In FY23, while Trent’s revenue increased by 83%, Zudio’s revenue soared significantly, surpassing a remarkable 219% growth.
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Does Zudio Franchise worth the investment?
As stated earlier in the post, Trent, Zudio’s parent brand, had posted a net profit of nearly ₹114 Crore for the Q1FY22, includes the profits of Westside, Zudio, and other subsidiary.
It is needless to mention that for a brand like Zudio, located at high-traffic area has potential to garner the impressive customer footfall, resulting a gigantic monthly sales numbers.
However, considering the midpoint investment of at least ₹3.5 Crore and an estimated net profit (16% fixed), a franchise partner can anticipate recouping their initial investment in at least 5 years to 10 years.
Please note that these are merely an estimated numbers. For more accurate information, you can directly connect with the Zudio’s official team (only via franchise form).
What are the requirements for Zudio franchise?
- The franchisee must meet the financial and site requirement(store frontage: 40ft) and should bear the expenditures such as rent and electricity cost of the outlet.
- To own or invest in franchise outlet, one is advised to follow the guidelines and adhere to the standards of company.
- Candidate should have an initial investment of at least ₹3 Crore to ₹4 Crore and they should be ready to partner under the FOCO model.
- Interested applicant should be able to produce the original documents like,
- Pan Card/ Aadhar card
- Bank Passbook
- Business’s GST Certificate
- Franchise agreement
- Passport size photos
- Address proof of site
- NOC or Other requested document
- Interested prospect should have at least few year of experience in the apparel industry, that will enable them to understand the chain’s franchise in a better way.
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What are the alternatives to the Zudio Franchise?
Undoubtedly, partnering with a brand like Zudio would benefit its outlet owner. However, considering its extensive market presence, in-depth research into localities, and the tremendous demand for its franchises, it can be challenging for the chain to respond to every query instantly.
At FranchiseGoal, we strongly advise interested candidates to follow the legitimate process outlined on our website and to avoid paying any fees to anyone promising to provide you with Zudio’s franchise.
While you do the initial research on apparel franchises, you may consider a few viable options:
Yes, we understand that Zudio and PUMA offer different product ranges, and their pricing varies drastically. However, when considering Zudio’s outlet investment, one should not overlook including PUMA in their list.
One of the most popular international sportswear brands, PUMA, was established in 1948 by German entrepreneur Rudolf Dassler. With over 1000 exclusive showrooms and nearly 1000 MBO (multi-brand outlets), PUMA is certainly recognized as India’s No. 1 sportswear brand.
Unlike Zudio, you may not require a substantial initial investment. Entrepreneurs looking to venture into the apparel and fashion industry can take up franchises with an initial investment of merely ₹1 crore and can anticipate a healthy profit margin of over 20%.
Max Fashion is undeniably a leading apparel and fashion brand that competes with brands like Zudio, Yousta, and others. The chain entered the Indian market in 2006, and since then, it has expanded its operations across several cities in India.
According to the official report, Max Fashion has grown into a brand that operates over 500+ outlets in 20 countries and has exhibited a growth rate of 38% per annum.
To become an approved franchisee, you may need to have a similar investment range as Zudio. According to IndiaRetailing, one should be prepared to invest at least ₹2.5 crore to open a Max Store franchise.
How to Apply for Zudio Franchise?
Due to its higher franchise demand, Zudio requests its interested prospect to use Email for franchise related queries.
Once you are ready with the Zudio franchise’s financial and site requirements and prepared to take up this franchise, you need to visit the official website franchise form. The highlighted link will navigate you to the Zudio’s franchise form.
|Apply for Zudio||Get Started|
You should fill up the required details like Name, Email ID, Phone Number, Address(Street, City, State, Pin code), Business/Work experience, and Location Information.
After form submission, somebody from the franchise’s sales team will reach out to you for further processing.
Good Luck!! Happy Franchising!!
The Editor’s Thought
Since our first coverage on Zudio, we have experienced a significant surge for its franchises, with almost over 200 queries.
Undoubtedly, partnering with Zudio will demand substantial capital, and the entrepreneurs should be aware of its business inside and out, along with its key risks.
While the franchise has laid out its future expansion plans to open more outlets in Tier 2 and Tier 3 cities, the recent entry of Yousta can’t be overlooked. But the only good news is that Yousta doesn’t sell its franchises; it is owned and operated by Reliance Retail (so, yes, the competition isn’t over yet).
If you have enough capital and are passionate about the apparel and retail industry, then you shouldn’t wait to partner with the brand before someone else applies for your location.
Please let me know your thought on this article, and share it with your friends, relatives, and colleagues who are looking for Zudio.
Want to explore more? Then check out below franchising opportunities.
How much does it cost to Start a Zudio Franchise?
To become a reputed and renowned Zudio outlet owner, one would at least require ₹3 crore – ₹4 crore for the carpet space of at least 6000-8000 square feet.
Is Zudio a Tata product?
Yes. Zudio is one of the subsidiary chains of the parent company, the Trent(Wholly-owned by Tata group). Founded in 1998, The Trent has four subsidiaries – Westside, Zudio, Star, and Landmark.
Is Zudio and Westside same?
No. they aren’t same. However, they both are subsidiary chain of the parent company the Trent. Generally, to own a westside outlet, it requires little extra money than Zudio outlet.
What brands are available in Zudio?
They offer a wide range of apparel brands, some of which are listed below,
Generic, Lymio, Sparx, Amazon Brand – Symbol, Amayra, Dennis Lingo, Harpa.
To learn more about, Zudio franchise investment please read the complete article.