Franchising Australia 2012 report - Thewebconsole.com

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Executive SummaryThe Franchising Australia 2012 survey was conducted in the aftermath of a period ofworldwide economic instability following a major global financial crisis. Although Australianarrowly escaped experiencing a recession, the small business sector was affected byseveral years of economic uncertainty.The key findings of the Franchising Australia 2012 survey are highlighted in this ExecutiveSummary. Where possible, estimates have been included for the entire population ofAustralian business format franchises. Franchising activities in motor vehicle and fuelretailing were not captured in the survey due to the unique characteristics of theseindustries. However, data on motor vehicle and fuel retail franchises have been generatedfrom relevant industry sources 1 and this information has been incorporated into theExecutive Summary only.Below are the highlights of the Franchising Australia 2012 survey.Total number of franchisors in AustraliaThe 2010 database of franchisors was updated and contacted personally to ascertain thestatus of the organisations. This extensive process has confirmed that 1137 business formatfranchisors are currently operating in the sector. As this figure includes systems that offermultiple concepts under a single brand, it is estimated that there are 1180 business formatfranchise systems operating in Australia in 2012. Some 92 percent of these organisationsoriginated in Australia.A profile of the number of franchisors reported in the Franchising Australia surveys since1998 is illustrated below:YearNumber of franchise systems1998 6931999 7082002 7002004 8502006 9602008 11002010 10252012 11801 Data were obtained from the Australian Motor Industry Federation, Federal Chamber of AutomotiveIndustries, Australian Institute of Petroleum and Service Station AssociationFranchising Australia 2012 Page 9
Franchisor profile 1998-2012Number of franchisors150010005000/1998 /1999 /2002/2004/2006/2008/2010Year/2012Until the advent of the global financial crisis from 2008 to 2010, the sector witnessed steadygrowth. During this period of economic downturn in Australia the franchise sectorexperienced a decline in franchise systems. However, from 2010 to 2012 the sector beganto recover, reporting a net growth in franchise systems of 15 percent. (This trend is reflectedacross the national economy with small business growth of 3.6 percent reported in 2010and 0.4 percent in 2011. 2 ) Most of the franchise start ups have occurred in retail (food andnon-food) and administration and support service industries where entrepreneurs haveseized opportunities in fresh markets. The franchise sector provides an environment thatfacilitates entrepreneurial activity and encourages innovation. 3Total number of units in franchise systems in AustraliaThere are an estimated 65 000 business format franchised units and 8000 company-ownedunits, producing a total of 73 000 units operating in business format franchise systems inAustralia. An additional 6500 fuel retail and 4403 motor vehicle retail outlets are estimated.A comparison of the number of business format franchise units from 1998 to 2012 isprovided.2 Australian Bureau of Statistics (2012). Counts of Australian Businesses, Including Entries and Exits, Catalogue8165.03 The World Bank ranks Australia in the top 10 of 183 world economies for starting a new business, obtainingcredit and ease of doing business (Doing Business 2011:Measuring Business Regulations)Franchising Australia 2012 Page 10
Page 1 and 2: FranchisingAustralia2012Asia-Pacifi
Page 3: ForewordGriffith University is prou
Page 6 and 7: Dr Kelli BodeyDr Kelli Bodey is a L
Page 8 and 9: Asia- Pacific Centre for Franchisin
Page 12: YearNumber of business formatfranch
Page 15 and 16: franchising can service. A major ch
Page 17 and 18: IntroductionThe Franchising Austral
Page 19 and 20: Respondents were invited to complet
Page 21: Survey resultsFranchising Australia
Page 25 and 26: A2 In which year did this business
Page 27: Size of franchise systemsKey facts
Page 30 and 31: Company-owned units 2009/2010 Finan
Page 32: System size Number PercentSmall (Up
Page 35 and 36: A9 If you are planning expansion ov
Page 37 and 38: Total system turnover for 2009/2010
Page 39 and 40: Head office employeesPermanent full
Page 41 and 42: Enterprise agreementYes19%No81%Fran
Page 43 and 44: ChallengesKey facts• The ability
Page 45 and 46: B FranchiseesBusiness ManagementKey
Page 47 and 48: Franchisee life cycleKey facts• F
Page 49 and 50: Franchisee profitability76-100% off
Page 51 and 52: Availability of prospective franchi
Page 53 and 54: for new franchisees over the past o
Page 55 and 56: B7 How many franchise enquiries wer
Page 57 and 58: B8 How many franchises were granted
Page 59 and 60: difficulties associated with shop f
Page 61 and 62:
Response (Action)Total DisputesNumb
Page 63 and 64:
Causes of disputesCauses of dispute
Page 65 and 66:
Franchising Code of Conduct Complia
Page 67 and 68:
B15. Is compliance of the program m
Page 69 and 70:
B17. Please indicate whether you ex
Page 71 and 72:
B18. Please obtain data from your D
Page 73 and 74:
CFranchise OperationsFranchise Advi
Page 75 and 76:
Franchisor online communication and
Page 77 and 78:
(32 percent) or because profits are
Page 79 and 80:
11 to 15 years7%Duration of selling
Page 81 and 82:
C7What percentage of sales in the f
Page 83 and 84:
Franchisee involvement in developme
Page 85 and 86:
Franchising strategiesOtherMuliple
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Muliple unit franchisingNo36%Yes64%
Page 89 and 90:
International franchisingKey facts
Page 91 and 92:
C17Are you currently franchising ov
Page 93 and 94:
the result of little change (32 per
Page 95 and 96:
%60Impact of economic conditions on
Page 97:
Operational changes in response to
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