Otobi Ltd, one of the leading local furniture makers, has made foray into global business with its own brand by opening its first franchise outlet in India as part of the company's plan to promote the brand globally and expand businewss.

The move, some marketing analysts said, might be a more effective way than exports to win business as franchise helps a company ensure continuous presence among consumers and create a brand image.

Besides India, the company now puts focus on the markets in the Middle East and Sub-Saharan Africa to open more franchise stores, its Chief Executive Sabbir Hasan Nasir said yesterday.

“We think we ill enjoy a competitive edge in these markets compared with Chinese products," he said.

Otobi chalked out the plan to explore new markets after it had opened its first franchise store at Mani Square in Kolkata in November last year mainly to reach middle income segment ofWest Bengal.

"We have received much better response from customers after launching the retail outlet," said Sabbir.

Otobi, which makes diversified furniture ranging from home to hospital ones, moves to open retail outlets abroad under franchise deal as it observes that branded stores are more effective in wining consumer confidence than exporting products.

"Power of retail brand is stronger than that of manufacturing brand as it is closer to the customers," said the chief executive of Otobi, which took the decision to go global in 2006.

“As we will be able to maintain and grow the brand through our own model,

customer pull will be more. Automatically export will increase and sustain,” he added.

Under the franchise arrangement, Otobi will help its franchisees develop human resources, prepare advertising materials, set business strategies and maintain control over the day-to-day operations.

"The franchisees will not sell any other products than Otobi and all the branding activities will be done as per Otobi guidelines," said Sabbir.

At present, Otobi has stores in Tripura, Assam, Chhatisgarh, Sikim and Siligun in India. All these stores are run by dealers, not franchisees, according to Sabbir.

The Otobi chief executive said stores run by dealers are not always helpful to create a brand image among consumers.

'We have plans to penetrate into few other Indian states with our brand," he said.

Sabbir said the company wants to open 12 franchise stores abroad in the next three years.

Starting its journey in 1975 under the entrepreneurship of Nitun Kundu, Otobi has so far 12 showrooms and 530 dealers in domestic market to cater to the need of local customers, including corporate clients, with its wood and laminated board furniture.

The Otobi official said the company has been registering a faster sales growth for the last three years.

“We have been growing much faster for the last three years compared to the previous years. Obviously it is a double digit growth,” said Sabbir of Otobi that posted more than a 35 percent growth in sales to overTk 200 crore last year.

Syed Ferhat Anwar, professor of marketing at the Institute of Business Administration at Dhaka University, observed that opening franchise outlets abroad might be more effective means compared to exports to grab business. "It ensures continuous presence of a brand and reduces risks of a company that it faces in case of export," he said. sohel@thedailystar.net