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New Zealand Franchising
Sentiment and Trends
2023
Dr Callum Floyd
Managing Director, Franchize Consultants
Email. callum@franchize.co.nz - Web. www.franchize.co.nz - Ph. 09 523 3858
Franchize Consultants
Background
Established in 1989, Franchize Consultants (NZ) Limited is New Zealand’s
leading specialist franchise consultancy working with many well-known
international and local, homegrown companies.
Franchize Consultants is author of the New Zealand Franchisor’s Guide,
New Zealand Franchisee’s Guide, the FANZ Pre-Entry Programme for
prospective franchisees and the Franchising Best Practice Handbook.
Researching and reporting on New
Zealand franchising sentiment
and trends since 2010.
Key Services
→Franchise System Feasibility & Development
→Established Franchise System Review & Improvement
→Franchisee and Franchisor Manuals
→Franchisee Satisfaction Surveys
→Franchise Advisory Councils
→International Franchising
→Franchisor & Franchisee Learning & Development
Team
Combined experience of more than 125 years franchising
Our Values
→Integrity
→Clients come first and partnership
→Strategic insight & thought leadership
→Franchisee and franchisor focus
→Value delivered
Background
• 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
What is the FCI?
The FCI is New Zealand’s annual survey of confidence specific
to franchising businesses. The FCI reports on franchisor and
specialist service-provider attitudes toward general business
conditions, as well as key franchisor growth determinants
including access to capital, suitable potential franchisees, staff
and locations. The FCI also reports on franchising health
attributes by exploring franchisee sales, operating costs and
profitability, and franchise systems growth prospects.
2023 Franchising Sentiment & Trends
Respondents indicate whether they
expect the following aspects to be
better, the same or worse over the
next 12 months (compared to the
previous 12 months)
GENERAL QUESTION AREAS
1. General business conditions
2. Franchisor growth prospects
3. Franchising growth drivers
• Access to capital
• Access to suitable franchisees
• Access to suitable locations
• Access to suitable staff
4. Franchisee growth & profitability prospects
• Franchisee sales levels
• Franchisee operating costs
• Franchisee profitability
5. How are things looking for franchisors and franchisees
in their respective sectors?
6. What do you see as the greatest challenge to
franchise development in 2023?
7. What will provide the greatest opportunity to
franchising development in 2023?
8. Long term, which future major trends are likely to be
most impactful on franchise systems in the next 5-10
years?
General Business Conditions
Franchisor outlook for general
business conditions shows further
deterioration to net negative 38% in
January 2023 from net negative 27%
in January 2022.
Access to Suitable Franchisees
Franchisor sentiment towards access
to suitable franchisees remains at a
similar level from 12 months ago at
net negative 23% from net negative
27% in 2022.
Access to Financing
Franchisor sentiment towards access
to financing remains at an all-time
low at net negative 70%, the lowest
net confidence recorded since the
Franchising Confidence Index was
established in 2010.
Access to Suitable Locations
Franchisor outlook on suitable
locations remains largely unchanged
at net 13% from net 9% in 2022.
Access to Suitable Staff
Franchisor outlook towards access to
suitable staff improves (whilst still
negative) to net negative 14%
following a strong decline to net
negative 78% in 2022.
Franchisee: Sales Levels
Franchisors sentiment towards
future sales levels per franchisee
shows a hint of positivity at net 13%
from net 0% in 2022.
Franchisee: Operating Costs
Franchisee operating costs remain a
concerning area – with franchisors
sentiment at net negative 73%, no
change from last year.
Franchisee: Profitability Levels
Franchisor outlook on franchisee
profitability levels improves from net
negative 43% in 2022 to net negative
13% in 2023.
Franchisor Growth Prospects
Franchisor sentiment for their growth
prospects softens to net 0%, from
net 14% in 2022.
Greatest Challenge to Franchising Development
Top 5 challenges for 2023
1. Access to finance
2. Finding franchisees
3. Access to staff
4. Rising costs
5. Weak investor confidence
Research contact
For further information on the Franchising Confidence Index, contact:
Dr Callum Floyd, Managing Director of Franchize Consultants
• Phone. +64 9 523 3858
• Mobile. +64 21 669 519
• Email. callum@franchize.co.nz
• Web. www.franchisingconfidence.co.nz
• Web. www.franchize.co.nz

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New Zealand Franchising Confidence Index | January 2023

  • 1. New Zealand Franchising Sentiment and Trends 2023 Dr Callum Floyd Managing Director, Franchize Consultants Email. callum@franchize.co.nz - Web. www.franchize.co.nz - Ph. 09 523 3858
  • 2. Franchize Consultants Background Established in 1989, Franchize Consultants (NZ) Limited is New Zealand’s leading specialist franchise consultancy working with many well-known international and local, homegrown companies. Franchize Consultants is author of the New Zealand Franchisor’s Guide, New Zealand Franchisee’s Guide, the FANZ Pre-Entry Programme for prospective franchisees and the Franchising Best Practice Handbook. Researching and reporting on New Zealand franchising sentiment and trends since 2010. Key Services →Franchise System Feasibility & Development →Established Franchise System Review & Improvement →Franchisee and Franchisor Manuals →Franchisee Satisfaction Surveys →Franchise Advisory Councils →International Franchising →Franchisor & Franchisee Learning & Development Team Combined experience of more than 125 years franchising Our Values →Integrity →Clients come first and partnership →Strategic insight & thought leadership →Franchisee and franchisor focus →Value delivered
  • 3. Background • 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
  • 4. What is the FCI? The FCI is New Zealand’s annual survey of confidence specific to franchising businesses. The FCI reports on franchisor and specialist service-provider attitudes toward general business conditions, as well as key franchisor growth determinants including access to capital, suitable potential franchisees, staff and locations. The FCI also reports on franchising health attributes by exploring franchisee sales, operating costs and profitability, and franchise systems growth prospects.
  • 5. 2023 Franchising Sentiment & Trends Respondents indicate whether they expect the following aspects to be better, the same or worse over the next 12 months (compared to the previous 12 months) GENERAL QUESTION AREAS 1. General business conditions 2. Franchisor growth prospects 3. Franchising growth drivers • Access to capital • Access to suitable franchisees • Access to suitable locations • Access to suitable staff 4. Franchisee growth & profitability prospects • Franchisee sales levels • Franchisee operating costs • Franchisee profitability 5. How are things looking for franchisors and franchisees in their respective sectors? 6. What do you see as the greatest challenge to franchise development in 2023? 7. What will provide the greatest opportunity to franchising development in 2023? 8. Long term, which future major trends are likely to be most impactful on franchise systems in the next 5-10 years?
  • 6. General Business Conditions Franchisor outlook for general business conditions shows further deterioration to net negative 38% in January 2023 from net negative 27% in January 2022.
  • 7. Access to Suitable Franchisees Franchisor sentiment towards access to suitable franchisees remains at a similar level from 12 months ago at net negative 23% from net negative 27% in 2022.
  • 8. Access to Financing Franchisor sentiment towards access to financing remains at an all-time low at net negative 70%, the lowest net confidence recorded since the Franchising Confidence Index was established in 2010.
  • 9. Access to Suitable Locations Franchisor outlook on suitable locations remains largely unchanged at net 13% from net 9% in 2022.
  • 10. Access to Suitable Staff Franchisor outlook towards access to suitable staff improves (whilst still negative) to net negative 14% following a strong decline to net negative 78% in 2022.
  • 11. Franchisee: Sales Levels Franchisors sentiment towards future sales levels per franchisee shows a hint of positivity at net 13% from net 0% in 2022.
  • 12. Franchisee: Operating Costs Franchisee operating costs remain a concerning area – with franchisors sentiment at net negative 73%, no change from last year.
  • 13. Franchisee: Profitability Levels Franchisor outlook on franchisee profitability levels improves from net negative 43% in 2022 to net negative 13% in 2023.
  • 14. Franchisor Growth Prospects Franchisor sentiment for their growth prospects softens to net 0%, from net 14% in 2022.
  • 15. Greatest Challenge to Franchising Development Top 5 challenges for 2023 1. Access to finance 2. Finding franchisees 3. Access to staff 4. Rising costs 5. Weak investor confidence
  • 16. Research contact For further information on the Franchising Confidence Index, contact: Dr Callum Floyd, Managing Director of Franchize Consultants • Phone. +64 9 523 3858 • Mobile. +64 21 669 519 • Email. callum@franchize.co.nz • Web. www.franchisingconfidence.co.nz • Web. www.franchize.co.nz