`Franchising dilutes brand value` recommended quiet rigidly retail strategy presentation of a major mobile retail company. Involved in franchise and retail business research, this surely appears to me as an intriguing question. Is this assumption for real? Let’s go by the market research methodologies and first define the problem. So a brand will be a name, sign, symbol, slogan or anything that is used to identify and distinguish a specific product, service, or business.

The associated brand value will be the amount that a brand is worth in terms of income, potential income, reputation, prestige, and market vakue.  

So broadly it will be the worth of that the differentiation creates. Alright, then differentiation is the key! but what if when scenarios in which there is a limited scope of creating differentiation for the product/service offering which is the case in most of the mature markets like U.S. Ditto is the case in saturated product and categories where differentiation will either seek huge capital investment or out of the box innovation. It should imply that each of the market players would have optimised brand value. Franchising now is just a mode of expansion. Thus in a saturated market there remains a limited scope of brand value dilution through a mode of mass expansion which is the only scope of generating higher sales volumes and hence business viability. It comes as no surprise as prolific franchise activity in most of the mature markets stands verdict. India on the contrary today stands impregnated which new concepts and business formats whose growth is galvanized by the fast growth of economy. Most of the market/product segments seeks consolidation. The market success today in through hit and trail patterns. Here obviously the fear of diluting the differentiation can be real as the scope for creating such differentiations/new brands is infinite. However, this is bound to optimise as it has happened everywhere else in the world. Franchising has indeed no direct correlation with the brand value dilution. The equation is a complex one including some more variables for instance stage of market/product segment maturity, product lifecycle, anticipated future market ecosystem. So you can blame franchising alone.