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How strange that from New Zealand we find reports of confident franchisors and not so confident franchisees. It’s almost refreshing to read of a report that outlines a full range of franchising sentiment.
A net 16 percent of franchisors expect franchisee profitability levels to be better, though service providers are less optimistic: a net seven percent (27 percent in July) expected deterioration in franchisees sales levels, while 41 percent predict deterioration in operating costs. And a net 24 percent expected franchisee profitability levels to deteriorate. Franchising.net.au
Following on from the GFC and New Zealand’s inaction over calls for regulation in 2008/9 is it any wonder franchisee investor confidence is down.
The challenges that the franchising industry could soon be faced with include tougher bank lending criteria, franchisees not paying franchisor royalties, difficulties maintaining confidence in the franchise system and workplace competition for prospective franchisees.
And a frightening message from Dr Callum Floyd’s Franchising Confidence survey;
This drop in sentiment is alarming. Service providers expect further deterioration (with a net -15% compared with -12% in April) in franchisee profitability over the coming year. Franchise Chat
If the truth be known many might expect very similar sentiment reporting across the globe.
If the truth be known …