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The Franchize Consultants’ April 2012 New Zealand Franchising Confidence Index demonstrates growing business confidence across a number of measures crucial to franchisor and franchisee success. The quarterly April results consolidate upon the rebound in confidence captured in January 2012.
Franchisors were asked ‘how things are looking in their sector’, and service providers ‘how things are looking for franchisors and franchisees (generally).’
Most indicated current and steady growth. Strong positive responses came from the pet industry, courier services, financial sector and construction. Following from the January quarter, those identified as involved in retail are still challenged somewhat with subdued sales and strong competition; however, the general sentiment was more positive.
Service providers were generally more positive in their outlook for franchisors, reflecting the statistics identified earlier. Improvements were noted for economic stability, access to finance and franchisees, growth prospects generally, and improved consumer confidence.
Franchisors and service providers alike were asked what they perceived to be the greatest challenge to franchising development in the year ahead.
The responses indicate real concern for franchise network growth, particularly relating to unit growth from finding franchisees. Aligned concerns emanate from the economy. Both factors received considerable attention from franchisors and service providers alike.
Technology features as a real focus of challenge and from multiple quarters, including the impact of Internet sales, social media and keeping up with technology generally.
Service providers were also concerned with franchisee confidence and satisfaction, and access to finance. Interestingly, only one franchisor highlighted access to finance as a challenge this quarter. In the previous quarter, it was the second highest theme recorded and featured 10 times by franchisors. Other notable themes with at least two responses included finding suitable locations, legislation/ compliance complicating growth, and competitive forces.