One of India’s most reputable brands for fresh fruit, vegetables, and dairy goods is Mother Dairy Safal, a division of the National Dairy Development Board (NDDB). Planned to be launched in 1988, Safal offers direct linkages to consumers and farmers at a fair price for good quality produce. With the growing need for healthy food and organized retailing, Safal franchise stores are fast becoming popular among urban consumers. This is a great chance for businesspeople to join hands with a stable brand that enjoys a strong supply chain and consumer confidence.
With more than 400 locations in Delhi-NCR and 23 in Bengaluru, Mother Dairy’s Safal serves more than 1.5 lakh people every day. Every day, it purchases 350 MT of fresh vegetables from 8,000 farmers across 20 states. Safal offers more than 120 SKUs for sale, including frozen foods and pulses. To support Safal’s horticulture sector, Mother Dairy is investing more than ₹350 crore in new processing facilities.
The franchise option is mid-level in investment and provides total support in the shape of logistics, quality assurance, marketing, and operations management. Even new retailers will find the method useful. This article covers the investment cost of buying a Mother Dairy Safal franchise, starting investment, recurring costs, potential earnings, and the step-by-step application process. As a new businessperson or seasoned businessperson, knowing the model for investment and return is important in making an informed decision.
About Mother Dairy Safal
To bring discipline to India’s unorganized fruit and vegetable industry, Mother Dairy launched Safal, its fruit and vegetable business, in 1988. Safal has a portfolio of about 120 stock-keeping units (SKUs) of fresh vegetables and fruits and value-added and processed fruits and vegetables, and value-added products like unpolished pulses, frozen snacking foods, tomato puree, and honey. Safal brought frozen food to India in the mid-1990s and revolutionized the market with frozen peas, mixed vegetables, and sweet corn.
Amongst the biggest draws of Safal’s business is the direct association model with almost 50,000 farmers across 16 states through deals with more than 200 farmers’ associations. The model runs on the principle of honest prices, quality-safe food, and promoting sustainable agriculture.
To increase its volume of processing, Mother Dairy is investing up to ₹600 crore to set up two fruit and vegetable processing plants in Gujarat and Andhra Pradesh. The investments reflect Safal’s commitment to delivering quality and economical fruits and vegetables and securing the livelihoods of Indian farmers.
Why Invest in the Mother Dairy Safal Franchise?
The Mother Dairy Safal franchise is a value proposition having many benefits making it a highly profitable business venture in India’s emerging organized retail space. A strong operational support system gives the franchisee a sound platform to start a successful business.
- Brand Established Trust: Mother Dairy, a company that has been a goodwill ambassador for decades, supports Safal. Franchisees are supported through immediate recall of the brand, obviating the need for extensive marketing and allowing for concentration on day-to-day activity and customer care.
- Good Supply Chain: Franchisees are provided with a robust supply chain. Fresh fruits and vegetables are sourced directly from clusters of farmers, providing guaranteed inventory and best-class products, crucial in the perishable goods segment.
- Core Product Offering: Fresh fruit and vegetables are everyday household products that create assured traffic in any kind of market situation. This renders Safal stores less market-sensitive than specialty or luxury stores.
- Sustained Market Growth: India’s organized retail market for fruits and vegetables is expanding at a growth rate of 15-20% per annum. The high growth rate of the sector translates to high growth opportunities for franchisees.
- End-to-End Operational Support: Mother Dairy provides store setup, layout designing, stock management systems, employee training, and regular operations support, perfect for novice business owners with little retailing background.
- Technology Integration: Safal stores are fitted with advanced POS systems and stock management software, offering data-driven, effective operations, less wastage, and simple stock management.
- Positive Social Impact: The model provides a good product to farmers and an economic price to consumers. The entrepreneurs also form a decent and transparent agri-value chain wherein profit is achieved with purpose.
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Initial Capital Needed:
Opening a Mother Dairy Safal franchise involves smart financial planning and proper knowledge about the different amounts spent. Investment can be lumped into two broad categories, consisting of one-time establishment costs and recurring operating costs. The specifics on the required initial capital are as follows:
Franchise Fee and Security Deposit
The first franchisee charge for an individual Safal outlet is usually in the range of ₹2-3 lakhs, which entitles the franchisee to the Mother Dairy Safal brand name and business concepts. The franchisees also have to pay a refundable security of ₹5-10 lakhs, which acts as a hedge against any damage or violation of the franchise agreement. The deposit is refunded at the end of the term of the franchise if all conditions have been satisfied to the parties’ satisfaction
Store Setup Costs
| Investment Component | Details | Estimated Cost |
| Space Requirement | 200–300 sq. ft. selling area; can be rented or purchased. Rent security in cities usually lasts 6 to 12 months. | ₹30,000 – ₹1.5 lakhs/month (rent) |
| Interior Development | Must follow Mother Dairy’s branding and layout guidelines; includes painting, signage, flooring, and layout planning. | ₹3 – ₹7.5 lakhs (₹1,500–2,500/sq. meter) |
| Equipment and Fixtures | Includes refrigeration units, weighing machines, billing system, display racks, and storage units. | ₹8 – ₹12 lakhs |
Technology and Systems
A Safal franchise requires the installation of point-of-sale (POS) systems with inventory management software. Technological support like computers, barcode readers, printers, and software licenses amount to approximately ₹1.5-2.5 lakh.
Licenses and Permits
Some of the licenses and permits are necessary to operate a food retailing business in India:
- Food Safety and Standards Authority of India (FSSAI) license
- Shop and Establishment license
- GST registration
- Municipal Corporation permits
- Trade license
The entire cost of obtaining such licenses normally ranges from ₹25,000 to ₹50,000 based on location and local regulations.
Working Capital
Apart from the fixed cost of establishment, franchisees should have sufficient working capital to finance first-time inventory purchases, employees’ salaries, power bills, and other operational costs for a minimum of 3-6 months until the business is self-financing. A rough estimate for working capital is between ₹10-15 lakhs.
Total Investment Summary
Taking into account all the above considerations, the overall initial investment needed for opening a Mother Dairy Safal franchise varies between around ₹30-50 lakhs, as follows:
| Investment Component | Approximate Cost (₹) |
| Franchise Fee | 2-3 lakhs |
| Security Deposit | 5-10 lakhs |
| Interior Development | 3-7.5 lakhs |
| Equipment and Fixtures | 8-12 lakhs |
| Technology Systems | 1.5-2.5 lakhs |
| Licenses and Permits | 0.25-0.5 lakhs |
| Working Capital | 10-15 lakhs |
| Total Investment | 30-50 lakhs |
Potential franchisees must also remember that these are approximate figures and can change according to specific location, store size, and prevailing market. Mother Dairy also modifies its franchise investment levels from time to time, so it is always better to have the most current information directly from the company before making any investment.
Profitability and ROI:
Knowledge of the potential returns on investment is important in evaluating a Mother Dairy Safal franchise. Though profitability is mainly a function of location, efficiency of management, and local market conditions, some parameters can be used to evaluate the business opportunity for prospective franchisees.
Revenue Potential
A well-placed Safal outlet would generally do ₹10-20 lakhs of sales per month, with a seasonality factor. Up-market residential belts or commercial areas would do much more. Sales volume would be the highest during festival seasons and would naturally pick up during summer when fresh fruit consumption is higher.
The gross margin of fruits and vegetables is generally 15-20%, whereas other products such as dairy products, pulses, and processed foods may provide margins of 10-15%. The average combined gross margin of a Safal store is generally in the range of 16-18%.
Operational Expenses
The average monthly operational costs of an average Safal store are as follows:
| Expense Category | Details | Estimated Monthly Cost |
| Rent | Location-based commercial rent | ₹30,000 – ₹1,50,000 |
| Staff Salaries | For 3–5 staff members | ₹60,000 – ₹1,00,000 |
| Electricity | Required for refrigeration and store operations | ₹15,000 – ₹25,000 |
| Wastage | 5–8% of goods’ value | ₹50,000 – ₹1,20,000 |
| Transportation | Delivery and logistics costs | ₹15,000 – ₹30,000 |
| Miscellaneous Expenses | Cleaning, maintenance, minor repairs, etc. | ₹20,000 – ₹40,000 |
| Total Estimated Monthly Expenses | Combined operational costs | ₹1.9 – ₹4.65 lakhs |
Net Profit Margin
After deducting all the costs of operations, a good Safal shop may achieve net profit margins of 8-12% of sales. This could mean monthly profits of around ₹80,000-2,40,000, depending upon location and operating efficiency.
Return on Investment (ROI)
Based on the initial investment range of ₹30-50 lakhs and projected monthly profits, the average ROI term for a Safal franchise would be:
Breakeven Point: 18-24 months
ROI Timeline: 3-5 years for overall investment payback
Annual Return Rate: 20-30% once the business stabilizes
Assistance from Mother Dairy Safal:
Mother Dairy provides its Safal franchisees with full support and cultivates a connection that goes much beyond a standard brand licensing arrangement. Complete assistance greatly minimizes operational issues for owners of individual franchisees and helps maximize achievement levels against stand-alone produce retailers.
Store Establishment Support Required
Mother Dairy offers assistance to first-level franchisees in choosing suitable shop locations based on footfalls, accessibility, and competition in the vicinity. It offers standard design and layout plans for easy working and helps in procuring necessary equipment at discounted prices from authorized dealers.
Supply Chain Integration
Mother Dairy’s strong supply chain is the presence of franchisees, to whom the farmers directly supply quality produce at their doorsteps. Logistics and transportation are handled by the company and equipped with available stocks from time to time. Quality check at various stages is also provided to check product returns and build customer satisfaction.
Operational Training and Support
New franchisees are given 2–3 weeks of in-depth training in operations, stock management, and customer service. Field officers provide routine support in keeping up standards, while POS machines and store software technical support is provided.
Marketing and Promotional Support
Nation-wide and local-level advertising campaigns are undertaken by Mother Dairy to facilitate increased visibility. Seasonal marketing, display content, and promotional material at points of sale are also provided for franchisees to promote traffic, predominantly during festive season months and festivals.
Business Development Leadership
Franchisees are educated on business performance and strategic direction by development managers to realize best-of-the-line sales and line of products. Best practices are disseminated through workshops and regular meetings to promote continuous improvement and growth.
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How to Apply for Mother Dairy Safal Franchise:
It includes a formal application and selection procedure to select potential candidates having the capability to run the business and grow it rightly. The whole process takes place in 3-6 months from the submission of the application to the opening of the store. Step-by-step description of the application process is provided below:
Eligibility Criteria
The applicants should meet the following requirements to become eligible to receive a Mother Dairy Safal franchise:
| Eligibility Criteria | Details |
| Investment Limit | ₹30–50 lakhs, with at least 50% in liquid funds |
| Educational Qualification | Minimum graduation; prior business experience will be considered favorably |
| Age Group | 25–55 years, to ensure active operational involvement |
| Property Requirement | Lease or ownership of 200–300 sq. ft. in a commercial complex |
| Residence in the Area | Preference for applicants residing in or near the proposed outlet location |
Application Process
- Initial inquiry and expression of interest: Submit an online application on the website (http://www.motherdairy.com)or mail it to the franchise team. You need to tell them your background, finances, and area of interest.
- Initial screening: Mother Dairy performed an initial eligibility screening of the first application. The shortlisted applicants are asked to submit a detailed form on business experience, finance, and location.
- Location evaluation: An evaluation team conducts site visits of the subject location and market visits, footfalls, demographics, visibility, local competition, and commercial viability.
- Personal interview: The franchise development team personally interviews each candidate to assess his or her business awareness, retail awareness, operating readiness, and brand value compatibility.
- Background check: Mother Dairy conducts proper verification regarding financial documents, educational background, business experience, and property lease deed or ownership documents verification.
- Agreement and franchise documents: They are given a 5–7 year agreement, pay the amount of franchisee, and complete legal formalities for use of branding name, compliance, and licenses.
- Training and store establishment: The store opening is conducted post-approval, interior designing, fitting out equipment, recruitment of personnel, training, planning of inventories, and POS installation are conducted by Mother Dairy with support.
Challenges to Consider:
While a Mother Dairy Safal franchise offers significant advantages, the potential buyers would need to apply judicious care concerning numerous issues that are typical for this business concept before their investment. Preventive awareness and knowledge of those issues can aid in developing practical measures of prevention as well as help in the management of reasonable expectations:
- Perishable Inventory Management: Fruits and vegetables are short-duration perishables (1–4 days), and therefore, cause massive wastage unless optimally managed. Franchisees must plan the inventory properly and adjust according to seasonality variations in availability to avoid losses.
- Price Volatility: Produce prices change frequently based on weather or market disturbances. Margins are compressed when prices change, and local retailers offer competition when there is an oversupply.
- Location Dependencies: The success of the Safal outlet heavily depends on footfalls. Demographic shifts in the vicinity, infrastructure growth, or new entrants in the vicinity can drastically affect the business.
- Operational Intensity: A lot of day-to-day effort is involved in running a Safal outlet. Fresh fruits and vegetables are delivered early in the morning, and the shop usually runs for more than seven days, with round-the-clock monitoring and handling of staff.
- Changing Retail Landscape: Web-based grocery apps, supermarket departments at physical stores, and farm-to-table operations are changing buying trends, and shopping apps based on the web unleash tough competition to offline stores like Safal.
- Working Capital Management: Suppliers’ short credit periods need to be managed with largely cash-in-hand day-to-day sales. Seasonal piling up in addition to inevitable expenses like repairing equipment justify well-planned working capital management.
- Regulatory Compliance: Compliance with food safety laws, plastic usage laws, and employment laws involves administrative activities. Keeping up with new regulations is necessary to avoid incurring fines and maintain smooth operations.
Conclusion:
Mother Dairy Safal franchises provide investors a great start to India’s organized market for fresh fruits and vegetables, under a national brand and an assured supply chain, at the investment level of ₹30-50 lakhs. The business model is cost-effective and provides immense support to neutralize operating risks.
Anticipated ROI is 8-12%, typically in 3-5 years, because of proper inventory control, minimal wastage, and highest customer satisfaction. The company demands daily maintenance and not for a passive investor. The secret of success strongly depends on location, local locations are preferred the most. Future franchisees must invest time searching and acquiring the best location.
The model is being rebuilt by advanced inventory systems and technology to satisfy changing consumer demands. Although the category of fresh fruits and vegetables is plagued with difficulties such as price fluctuation and perishability, trend-driven franchisees willing to maintain the momentum can outclass the market. For serious entrepreneurs dedicated to their company, Safal provides a structured, brand-backed entry into value-goods retailing with vast scope for growth in India’s changing consumer economy.
FAQs
1. What is the minimum floor area required to make a Mother Dairy Safal store?
A typical Safal store needs about 200-300 square feet of retail area in a visibility-point location ideally on the ground floor with a reasonable frontage to have maximum exposure.
2. Is prior retail experience a requirement for a candidate wishing to apply for a Safal franchise?
Prior retailing experience is not mandatory. Mother Dairy offers complete training and working assistance to new franchisees. General business acumen and management skills are essential for effective working, though.
3. Can I sell products other than fruits and vegetables at my Safal outlet?
Safal stores are mostly fruit and vegetable shops. But based on the location and size of the store, Mother Dairy might allow ancillary products such as dairy products, pulses, and some packaged food items under guidelines.
4. What is the typical franchise agreement period?
Mother Dairy Safal franchise agreements are usually for 5-7 years extendable based on performance and adherence to operating standards.
5. How often is stock supplied to Safal shops?
A majority of Safal outlets are loaded with fresh stocks 6 days a week, frequency reduced in the off-season or festive season when the turnover is high. Scheduling of supplies is managed by the distribution channel of Mother Dairy.
