Results from the latest Franchize Consultants New Zealand franchising confidence survey.

1. January 2013 Quarter Results
FRANCHISORS ENTER 2013 CAUTIOUSLY OPTIMISTIC

2. About Franchize Consultants
• Franchize Consultants is the first point of contact for
companies considering franchising their business
• Franchize Consultants helps established franchised (and
other network format) chains review and improve
performance for both franchisors and franchisees
• Franchize Consultants conducts specialist research for
franchising insight and practical application
• Franchize Consultants builds franchisor executive and
franchisee capability and performance through focused
training and education programmes

3. Key Survey Highlights
• The January 2013 Franchising Confidence Index demonstrates a
continuation of mixed results across overall sector drivers, with
slightly more positivity seen.
• Franchisors were most positive in their outlook for prospects
for growth, general business conditions and franchisee sales
levels.
• Meanwhile, franchisor forecasts indicated a continuing
negative/poor outlook for franchisee operating costs, availability
of staff and franchisees.
• Written answers revealed increasing positivity, though
conditions are still challenging within specific sub-sectors.

4. Background
• Quarterly survey of more than 400 New Zealand
franchisors and 100 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 38 franchisors and 23
Service Providers.

5. The Focus
GENERAL QUESTION AREAS
1. General business conditions
2. Franchisor growth prospects
3. Franchising growth drivers Respondents indicate
• Access to capital whether they expect
• Access to suitable franchisees
• Access to suitable locations the following aspects
• Access to suitable staff to be better, the same
4. Franchisee growth & profitability prospects
or worse over the
• Franchisee sales levels next 12 months
• Franchisee operating costs (compared to the
• Franchisee profitability
previous 12 months)
5. How are things looking for franchisors and Franchisees in
their respective sectors?

6. The Results
Franchisor responses continued to
improve to a net 37%, compared to 28%
in October. Similarly, Service Provider
sentiment showed a more marked
improvement to 66% (current) from 42%.

7. The Results
Franchisor outlook for franchisor growth
prospects increased from a net positive 28%
to 41%. Service Providers’ outlook echoed this
with increase from 38% in October to 61%.

8. The Results
Both franchisors and Service Providers
remain positive in their outlook for
access to financing, albeit Service
Providers (net 26%) are more positive
than franchisors (net 13%).

9. The Results
Sentiment toward access to suitable
franchisees dropped this quarter.
Franchisors had the lesser decrease
from net 14% to 5%, whereas Service
Providers dropped from net 35% to
only 9%.

10. The Results
Confidence in access to suitable staff
demonstrates a drop from both
franchisors and Service Providers
since the October survey. Franchisors
decreased from net positive 6% to
negative 5%. Service Providers
dropped from net 23% to 13%.

11. The Results
Franchisor sentiments towards access
to suitable locations took a substantial
tumble this quarter, from a net positive
23% to negative 5%. Service Providers
were more positive at net 31%.

12. The Results
Franchisor and Service Provider
sentiment towards franchisee sales
levels both show an increase to
32% (franchisors) and 44% (Service
Providers), after both showing a
decrease in October.

13. The Results
Both franchisors and Service
Providers show a slight increase in
confidence for franchisee operating
costs (even though still remaining
below zero) ending at a net
negative 11% and 4%, respectively.

14. The Results
Overall sentiment toward future
franchisee profitability levels also
increased.
Franchisors increased confidence to
net 13% from negative 3%, and
Service Provider confidence improved
a net 30% from 0% in October.

15. The Results
GREATEST CHALLENGE TO FRANCHISING DEVELOPMENT
Franchisors identified finding
franchisees and franchisee business
model-related concerns as the two
top challenges to franchising
development in 2013

16. More Information
Including:
• More detailed and complete results and analysis
• All charts and illustrations
www.franchisingconfidence.co.nz

17. Franchize Consultants
• 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
• Ph. (09) 523 3858
• Mob. 021 669 519
• Email. callum@franchize.co.nz
• Web. www.franchisingconfidence.co.nz
• Web. www.franchize.co.nz