Share Market Franchise & Other Business Model for Easy Earning
Share Market Franchise also sometimes known as the Authorized Person or Sub Broker. Share Market Franchise is a sub-broker program which creates a way for individuals to become sub-brokers of top stock brokerage firm like Angel Broking, Sharekhan, etc.
Getting stock broking license is very expensive and requires one to follow a lot of rules and regulations of the government, not everyone can afford it. Through this program, people can become part of brokerage firms.
What is Share Market Franchise?
Generally, when people think of stock market they think of either investing in the market or getting a job in a large brokerage firm but the concept of Share market franchise has changed all that. One can easily become an entrepreneur by becoming a sub-broker. So how does one become a Sub-broker? Let’s see.
Find out all the leading Sub Broker Franchise here: https://franchisebooking.com/
There are three parties involved: one is franchise owner i.e. one who owns the brand and Franchisee who wants to use the brand and its name to run the business, and the third is the client or customers which the sub-broker has to get.
There will be an agreement between the Franchisor and the Franchisee. A franchisee might have to pay an initial security deposit of 50,000 to 300,000 which is refundable. The amount varies depending upon the terms and condition of agreement between the two parties. There might be some charges to get registered through SEBI.
In some cases, they might not even ask for this. This is a win-win model for all the three parties involved franchisor, franchisee and the clients or customers. Franchise owner or franchisor gets to expand his business by getting additional clients bought in by the franchisee.
Franchisees get to use the brand name and increase their clients. Clients get a personal touch and stock recommendation. Depending upon communication and networking skills one has, and the services being provided to clients, the sub-broker could make earn a good amount of money and if clients are happy with one's services they would stay (retention) and also refer other prospective clients.
They are many stockbrokers like Angel Broking, Sharekhan, Motilal Oswal, Edelweiss, etc. with wide brand recognition.
Types of Share Market Franchise?
There are basically 3 types of broking franchise, we will discuss here:
Master Franchise: This type of franchise is very common in India. Here, the franchise gets a fixed percentage, if any other franchisee gets opened in the neighborhood, city or state depending upon the agreement with the franchise owner.
Sub-broker: In this type, a person has to get his own clients, through his marketing and communication skills. He needs to have a good network as well. And he might also be trading on behalf of them. So, the brokerage sharing ratio would be 70:30 where 70% goes to the sub-broker and 30% to the firm. Again, the revenue sharing percentage varies from company to company and the agreement between them.
Remisier or Associate Business Partners: Remisier is an agent of a stockbroking company. His job is to get clients who can invest through the broker. All he has to do is refer prospective clients. Since, his job is simple the sharing ratio would be 30:70 in ratio (where, 30% goes to the Remisier and 70% to the firm).
Zerodha Partner Program has been the most renowned among all, check out here.
Benefits of Share Market Franchise
The brokerage sharing between the broker and sub broker is based on agreement. Generally, the sharing ratio could be of 70:30 or 60:40 with sub-broker receiving 70% and the brokerage firm 30% or sub-broker receiving 60% and brokerage firm 40% respectively.
One need not even have proper office space or building this could be started just from the house, provided you have a laptop, phone and internet and in some cases even these are provided by the brokerage firms.
You pay 50k to 3Lacs security deposit which also would be refundable. So low investment and high return.
Sometimes Franchise Owner also provides the franchisee with the infrastructure and platform required like software or training.
With the advent of smartphones and nearly free internet, the scope of sub-broker is on the rise as one can start a business just by sitting in the house. In India, the government is also promoting initiatives like the start-up India and entrepreneurship.
There is a lot of untapped market in India as only around 1.5% are presently investing in securities compared to China where around 10% invests in securities. And with the stock market skyrocketing in recent years everyone wants to get in on the action.
Slowly, with financial literacy being introduced in the schools and colleges, the scope of becoming a sub-broker increase and more people are ready to become ready to invest.
In fact, CEO of Zerodha, Mr Nithin Kamath was once a sub-broker with Reliance Money and now Zerodha is one of the most profitable brokers in India.