New Zealand Franchising Confidence Index | April 2011
<ul><li>Quarterly survey of 383 New Zealand franchisors and 115 specialist service providers (e.g. consultants, banks, accountants, lawyers and publishers) to the franchising community.
Explores confidence in key measures critical to the success of franchising, including the wider environment, growth determinants, and franchising health attributes and franchise system growth prospects.
This survey represents the views of 39 franchisors and 20 service providers.</li></li></ul><li>Please indicate whether you expect the following aspects to be better, the same or worse over the next 12 months (compared to the previous 12 months)<br />
Franchisors (blue line) sentiment toward general business conditions (net -3%) has substantially deteriorated. Franchise service providers (e.g. banks, consultants, accountants and lawyers to the sector) were more optimistic (net 35%).<br />
Franchisors are still generally positive about forthcoming growth prospects for their organisations (net 36%), however optimism has dampened from January (net 54%). Service providers (net 40%) shared franchisors current optimism for growth.<br />
Franchisors expect access to capital to remain challenging (net -10%). Meanwhile,service providers (who include banking respondents) are considerably more optimistic (net 40% positive) for franchisors compared to January (8%). <br />Franchisor expectations regarding financing have now been negative for 12 months. <br />
Whilst improving marginally, franchisors expect franchisee recruitment to remain challenging (net 5% up from 3% in January 2011). Comparatively, service providers are considerably more positive in their outlook (net 45%). <br />
Meanwhile, franchisor and service provider perceived access to suitable staff are aligned and firmly positive reporting net 36% and 35%, respectively. <br />
Franchisors and service providers are positive, although less optimistic about franchisor access to suitable locations than January. <br />
While expectations for franchisee sales levels stabilise (net 33%), franchisor expectations for operating costs (net negative -38%) and profitability (net negative -3%) both deteriorated from the previous quarter. Franchisor expectations for franchisee profitability are now negative on balance for the first time since the survey began a year ago. <br />
<ul><li>Franchize Consultants’ April 2011 Franchising Confidence Index finds confidence eroding in the wake of the Christchurch earthquakes.
Reported earthquake impacts on franchisors and franchisees can be found in the full survey report.
Franchisee profits are expected to remain challenged. On balance franchisors expect franchisee profits to deteriorate.
Franchisee sales levels and operating costs are also expected to deteriorate over the next 12 months. </li></li></ul><li>Including:<br /><ul><li>More detailed and complete results and analysis
Franchisor and service provider comments in their entirety</li></li></ul><li><ul><li>The Franchising Confidence Index, is founded, designed and operated by Franchize Consultants, New Zealand specialists in franchising and licensing network development. Founded in 1989, Franchize Consultants have a long and supporting association with New Zealand franchising.
For further information contact Dr Callum Floyd