Is Blinkit’s Dark Store Franchise Model Worth It?
Intense Pressure Significant Investment
Operating Blinkit stores demands exceptional efficiency; pickers must pack orders in a mere 2.5 minutes, placing considerable pressure on them to meet targets and minimize errors, which could prove costly for the franchisee. Starting up requires a hefty upfront investment of Rs 80 lakh or more, covering expenses like branding, store setup, racks, and initial inventory.
Blinkit Dictates Terms
While franchisees oversee day-to-day operations, Blinkit maintains control over most aspects, including managing customer demand, inventory, rent, and electricity. They even dictate the product selection for each store.
Franchisees are also accountable for handling unsold perishables and addressing any incidents of theft or damage in the store.
Commission Structure and Profit Margins
Franchise operators in major cities receive a commission of 2.5%, while those in smaller cities get 2%. Although there are bonuses for achieving specific targets, some owners argue that these earnings are insufficient.
After covering monthly expenses, typically ranging from Rs 2-4 lakh, it may take over three years to turn a profit, with a potentially substantial return taking up to eight years to materialize—significantly longer than other franchise opportunities.
Limited Expansion Potential
The earning potential of a single store is capped. Once daily sales reach approximately 1500 orders on weekdays and 2500 orders on weekends, Blinkit seeks to establish new stores nearby with different owners. Blinkit prohibits franchisees from operating multiple stores within the same city, limiting potential growth opportunities.
Is it Sustainable?
The Blinkit franchise model demands substantial investment, extensive time commitment, and significant oversight from the company. The potential for profitability appears uncertain, raising questions about its long-term viability.
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