Results from the latest Franchize Consultants Franchising Confidence Index. Franchize Consultants are franchising and licensing consulting specialists, focusing on: 1. Helping companies franchise a business 2. Helping established chains improve performance 3. Building franchise and chain management capability

1. April 2018 Quarter Results
FRANCHISORS REPORT MIXED SENTIMENT

2. • 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
About Franchize Consultants

3. Key Survey Highlights
• Franchisors and Service Providers report a mixed sentiment with
decreasing confidence in general business conditions
• Availability of suitable staff remains a key challenge.
• Franchisor sentiment for access to suitable locations drifted slightly in
April, whilst Service Providers confidence increased substantially.
• Franchisor and Service Provider sentiment towards franchisee sales
levels lifted to remain an area of strength.
• Franchisor growth prospects sentiment also showed strong
increases from both Franchisors and Service Providers.

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 26 Franchisors
and 14 Service Providers.

5. The Focus
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?
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)

6. The Results
Franchisors continued to show a
decline in sentiment towards
general business conditions.
Franchisor sentiment (net negative
11%) decreased from the previous
quarter (3%), to its lowest level
since this survey began in 2010.
Service Providers remained neutral
at 0%.

7. The Results
•Franchisors (net 46%) remained stable about prospects for franchisor growth. These results are in line with the net 45% in the previous quarter.
Franchisor sentiment toward
franchisor growth prospects has
improved, climbing back to net 39%
up from 23%. Service Providers were
similarly positive at a net 21%, up
from 0%.

8. The Results
Franchisor sentiment toward access
to suitable franchisees has shown
improved sentiment this quarter
after hitting an all time low in
January. April sentiment at net
negative 20%, improved from net
negative 28%. Service Providers who
had been more positive previously
have dipped in sentiment dropping
to a net 0% from net 7%.

9. The Results
Franchisors and Service Provider
sentiment toward the availability
of suitable staff dipped further to a
net negative 22% from net negative
16% and net negative 50% down
from net 0%, respectively.
Sentiment appears to be showing
caution based on the perceived
challenges with upcoming
government changes to the
immigration policy.

10. The Results
Franchisors sentiment this quarter
towards accessing suitable locations,
which fluctuates regularly, slipped
slightly to net 4%, down from a net 7%.
Service Providers sentiment showed
more confidence at a net 38%, up from
net 14%.
•

11. The Results
Whilst there are challenges in some
areas, both Franchisor and Service
Provider sentiment toward franchisee
sales levels were very strong.
Franchisors recorded a positive
increase at a net 50%, up from 28%.
Meanwhile, Services Providers
improved from a net 7% to 36%.

12. The Results
Franchisee operating costs,
meanwhile, remained a challenge
with Franchisor sentiment
remaining stagnant at net negative
39%. Service Provider outlook
dipped slightly further to a net
negative 57% down from January’s
net negative 50%.

13. The Results
Franchisors sentiment towards
franchisee profitability levels, which
are a strong indicator of the economic
climate, took a dip to net negative 4%,
after lifting slightly in January to net
9%. A very negative decrease, net
negative 36%, in January for Service
Providers was reversed to a net
negative 7%.

14. The Results
Franchisor and Service Provider
sentiment toward access to financing
moved in opposite directions, with
franchisors dipping further to a net
negative 21%, down from 0%. Service
provider sentiment continued to
elevate from a net 7% to a net 14%.

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

16. 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