New Zealand's Best Source of Franchising Information Since 1992

Linkedin Twitter Googleplus Facebook

POSITIVE OUTLOOK FOR NZ FRANCHISORS, FRANCHISEES - LATEST

by Simon Lord,
last updated 07/08/2013

in this article:

August 2013 - Confidence continues to grow in future prospects for the franchise sector, according to the results of the latest Franchising Confidence Index survey

The latest Franchising Confidence Index shows franchisors and service providers are sharing continued optimism across many key growth drivers for the franchise sector. The July 2013 survey, the latest in the quarterly series conducted by Franchize Consultants, represents the views of 32 Franchisors and 16 Service Providers to the franchise sector.

Franchisors were most positive about improvements to franchisor growth prospects, sales levels per franchisee, general business conditions, and franchisee profitability levels. Both Franchisors (net 53 percent) and Service Providers (net 67%) were positive about prospects for franchisor growth, with only 3 out of 32 Franchisor respondents expecting franchisor growth prospects to deteriorate. Small improvements were also recorded in accessing suitable franchisees and suitable locations; however, sentiment toward accessing financing deteroriated slightly.

The results also indicate highly positive Franchisor (net 50 percent) and Service Provider (net 67 percent) sentiment toward general business conditions. These elevated results were shared by the latest results of other more general business surveys including the BNZ  (net 59 percent in July), ANZ Business Outlook (53 percent in July) and NZIER (31 percent in June) business confidence surveys.

Notably, only one of 32 franchisor respondents expected business conditions to deteriorate over the next 12 months.

Franchisee profitability has been one of the major concerns in recent years, but the recent trend towards improvements in the area continues in the latest survey. Both Franchisor (53 percent) and Service Provider (60 percent) sentiment toward future franchisee sales levels remained high and although they shared a negative outlook on franchisee operating costs the expectations for franchisee profitability were positive overall.

Summarising the report, Dr Callum Floyd of Franchize Consultants said, ‘We continue to be encouraged by positive sentiment toward franchisee profitability – arguably a franchise system’s most important key performance indicator. Similarly, high levels of sentiment and more positive comments relating to sales growth point to an improved outlook for franchisors and franchisees alike.’

* The figures indicate ‘net’ confidence. 'Net’ confidence is the difference between those reporting ‘better’ and ‘worse’.

Franchising Confidence Index summary - Oct 2012 to Aug 2013

Free

Shadow

Send for your free copy of our printed magazine, New Zealand's most respected,
comprehensive
guide.

featured

Paramount-services Dominoslogotile Westpac_tile_ad_2016 Crest2014tile 2385_fran_acc_fnz_web_tile_fo Goodwinturnerlogotile Freelisting Jim_s_building_inspections_logo_tile_web Nsme189586-0916-webtile-288x288px-white Wide_span_sheds_logo_tile
Wide_span_sheds_logo_tile Paramount-services Dominoslogotile Westpac_tile_ad_2016 Crest2014tile 2385_fran_acc_fnz_web_tile_fo Goodwinturnerlogotile Freelisting Jim_s_building_inspections_logo_tile_web Nsme189586-0916-webtile-288x288px-white
Nsme189586-0916-webtile-288x288px-white Wide_span_sheds_logo_tile Paramount-services Dominoslogotile Westpac_tile_ad_2016 Crest2014tile 2385_fran_acc_fnz_web_tile_fo Goodwinturnerlogotile Freelisting Jim_s_building_inspections_logo_tile_web
Jim_s_building_inspections_logo_tile_web Nsme189586-0916-webtile-288x288px-white Wide_span_sheds_logo_tile Paramount-services Dominoslogotile Westpac_tile_ad_2016 Crest2014tile 2385_fran_acc_fnz_web_tile_fo Goodwinturnerlogotile Freelisting

PUTTING PEOPLE in BUSINESS