LONDON–(BUSINESS WIRE)–Technavio market research analysts forecast the preschool or child care market in India to grow at a CAGR of close to 32% during the forecast period, according to their latest report.
The report further segments the preschool or child care market in India by age (children aged below three years and children aged 3–6 years) and by services (full-time preschools and on-demand preschools).
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Technavio analysts highlight the following three market drivers that are contributing to the growth of the preschool or child care market in India:
- Increasing change in lifestyle and demographics
- Rising penetration of market in focus in Tier-2 and Tier-3 cities
- Growing popularity of franchise model
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Increasing change in lifestyle and demographics
The consumer segment in India is segregated into urban and rural markets. At present, the country's population is dominated by the rural segment. But, factors such as the increase in nuclear families and disposable income because of globalization will lead to a higher proportion of urban population. The growing urban sector will positively influence the demand for childcare facilities. This is because urban consumers have become aware of the benefits of enrolling their infants, toddlers, and children in the early childhood stage in child care centers and preschools.
According to Jhansi Mary, a lead analyst at Technavio for K12 and higher education research, “The increase in women workforce is another aspect that is contributing to the market growth. Young women are moving to Tier-1 cities for better job opportunities and education. Over 50% of the women living in urban areas are working in both private and public sectors. The increase in the number of working mothers has increased the disposable income of households. However, this has reduced the time that they should dedicate to their children. Consequently, there is an increase in enrollment rates in preschools or child care centers.”
Rising penetration of market in focus in Tier-2 and Tier-3 cities
Tier-2 and Tier-3 cities are small cities that do not fall under the category of metropolitan cities. These cities are mostly regional hubs such as state capitals and centers for industries. Jaipur, Patna, Ahmedabad, Pune, Kochi, Mysore, Madurai, and Vishakhapatnam are a few of the cities that fall under the Tier-2 and Tier-3 city categories. The preschool or child care market in India is growing rapidly in these cities due to the transforming education sector in India.
The transformation in the education sector is taking place owing to the infrastructural development taking place due to the rise in government initiatives such as the Smart Cities Mission. This initiative involves the transition of 100 cities into smart cities. In addition to these developments, the demand for preschools is growing significantly in smaller towns and cities. Key players in the market such as Kidzee and TreeHouse are highly interested in expanding their businesses to other cities in India along with cities where they already exist.
Growing popularity of franchise model
The rise in the popularity of the franchise model is facilitating the expansion of the preschool or child care market in India. Many entrepreneurs with structured support are foraying into the preschool education sector, making it more accessible to the masses. One of the most successful models that are facilitating the expansion of preschools in the country is franchising. The rise in consciousness among parents regarding early childhood education has fueled the need for preschools and child care centers, increasing business opportunities for vendors in this market.
“International preschool brands foraying into India and upgrading of Indian brands to provide quality education are significantly contributing to the growth of the market in focus. The most hassle-free way to start a preschool education business is to opt for a franchise model. A few of the key players who follow the franchising system are Apple Kids, Kids Campus, Mother’s Pride, EuroKids, Bachpan, Kidzee, Kangaroo Kids, SHEMROCK, and Jumbo Kids,” says Jhansi.
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