If you keep up with the business scene of India, you must have gotten the sad news, yes, Sir Ratan Tata passed away at the age of 86. But sure, his legacy still stands among us, the companies he headed are still there being the income source for many in the country. And one such company is for sure Tata Motors. We don’t even need to tell you how big of a deal Tata Motors is in India, and it has been like that for quite a while now. Today though, we will be taking a good look at the Tata Motors franchise cost in India, if that’s what you are here for. So, here we go.

Types of Tata Motors Franchises

It is not like you apply for the Tata Motors franchise and that’s all. Nah, there is actually a lot that goes into it, but before any application process, you must at least decide on which type of Tata Motors franchise you want to own in India. So, let’s first get started with that, shall we? Here:

• Showroom Dealership: This franchise lets you sell Tata vehicles, SUVs, and accessories directly to customers, and that’s the basic one. With this type of franchise store, you will have a physical showroom where customers can see and drive cars.
• Service Station Dealership: Then there’s this one, which is actually dedicated to providing car after-services like repairs and maintenance for Tata vehicle owners. Without a single doubt, yes, this could be a great option if you’re interested in running a workshop or garage.
• Spare Parts Dealership: This franchise will help you sell genuine Tata Motors spare parts and accessories either to customers or to service stations.

Just keep in mind, that this is not any objective question that you have to just tick, nah, you must put a lot of thought into it and then decide which franchise type to go for or apply for. Always remember that this is the very step that’ll not only determine what or how much investment you must shell out but also how much you’ll be making in terms of profits, you know?

Tata Motors Franchise Cost and Investment Breakdown

To be honest, we’ll be straightforward with this investment section, and why’s that? Well, we know that getting involved with the Tata Motors franchise means that you have to put away a huge amount of cash upfront because the motor industry calls for heavy financial investments such as going for the rental space, assembling the required machinery, as well as acquiring the whole material and what not.

So, if you are a little confused about all that, just check out the following investments, and you’ll be good for the most part. Here:

• Franchise Fee: The franchise fee can be anything from ₹20 lakh to ₹30 lakh that you have to pay to take a Tata Motors franchise. It is the fee that is paid to Tata Motors for the use of the logo that gives them access to their knowledge of the business.
• Infrastructure Investment: By far, this is the most significant component of the investment. And just so you know, yes, you can expect to pay approximately ₹10 crore for the establishment of the showroom, the purchase of the tools, and the implementation of all systems in your showroom.
• Showroom Space: As you could have guessed already, an auto showroom in a metro city generally takes 2000 to 4000 square feet of space, that’s kinda the range. But having 3000 squares is ideal if you want to have cash payers satisfied.
• Inventory: This one is after you have set it up, but just to let you know, in your showroom, you will also have to purchase vehicles for display and to be sold. The amount of money needed for this kind of investment in metropolitan areas can be from ₹10 crore to ₹12 crore just so you know.
• Other Costs: Not to mention though, other costs like computers, CCTV, air conditioning, and showroom furniture will be other spending areas as well, which can cost ₹40 lakh to ₹50 lakh.

Overall, the total investment to open a Tata Motors franchise can range between ₹10 crore and ₹12.3 crore, depending on your location and the type of franchise you choose.

Revenue Sharing and Profit Margins

Well, first of all, you shouldn’t be doubting the profit margins you’ll be making as a Tata Motors franchisee, but still, if you do, just know that when you become a Tata Motors franchisee, you get to take home a whopping 95% of the business income while Tata Motors takes just a small 5% in royalty. To put it in the simplest words possible, the greater part of the money you generate from this business is kept by you. There are, however, various ways to make money as a franchisee. First of all, you earned a 3% commission from every vehicle sold. Secondly, if you sell spare parts via a service center, you could also make up to 25% profit, did you know that?