After successfully implementing motorcycle washing machines in multiple locations in Maharashtra, Karnataka, Tharkhand, and a couple of overseas locations, Taksande wanted to expand his business by opening independent stores in key locations in South India. The three strategic locations selected for expansion were Udupi, Chennai, and Bangalore. Taksande researched the market potential of these three locations and found that there was a $70$ per cent probability of having a favourable market. The steady growth of two$-$wheeler segments along with the boom in electric vehicles in these cities had a positive impact on market potential.

The expansion could be done by following one of two models; self$-$owned stores or franchise stores. If EBW expanded through self$-$owned stores, it would enjoy greater control over technological expertise and other propriety resources. In comparison, the franchise model would be relatively economical, and EBW might benefit from the expertise some franchise owners would have in marketing, sales, and operations of motorcycle wash services. Taksande estimated that he would generate a profit of $143,{000}^2$ per month in a favourable market and $68,000$ per month in an unfavourable market if EBW expanded through self$-$owned stores. If it expanded through franchising, Taksande expected to receive a franchise fee of $132,000$ per month in a favourable market and $82,000$ in an unfavourable market.

EXPERT OPINION

Taksande consulted with Varun Pai, who was at the time the owner and operator of multiple car wash locations in Udupi, Manipal, Chennai, Mangalore, Bangalore, and Hyderabad. Pai, who had extensive knowledge of the market scenarios in these major cities, informed Taksande that if the self$-$owned stores were located close to petrol stations, the overall profit generated would be at least $15$ per cent higher than Taksande's estimate of $143,000$ per month. In the case of self$-$owned stores in other locations, the profit generated would remain the same as estimated by Taksande. However, due to enormous demand and space constraints in these cities, the probability of getting locations for self$-$owned stores close to petrol stations was about $35$ per cent.