1. October 2016 Quarter Results
KEY FRANCHISING SENTIMENT METRICS REMAIN STRONG

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3. Key Survey Highlights
• Franchisors and Service Providers sentiment continues to
provide an optimistic outlook specifically across franchisee
sales levels, franchisee profitability, franchisor growth
prospects, and notably increased confidence in relation to
access to finance.
• Franchisors sentiment toward general business conditions was
substantially more positive this quarter, with Service Providers
more subdued.
• Franchisors sentiment about franchisee sales and profit levels
saw increased confidence in both areas.
• Franchisor and Service Provider sentiments for franchisor
growth prospects continued to show positive increases.

4. Background
• Quarterly survey of circa 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 35 Franchisors
and 19 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
The latest results indicated more
positive franchisor (net 40%)
sentiment toward general
business conditions. Service
Providers by contrast converged,
from net 50% in July to a net 42%

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.
Franchisors sentiment for franchisor
growth prospects continued to gain
momentum at net 57% compared
with a net 46% in July.
Service Providers perceptions
showed a slight increase at a net 53%
up from net 50%

8. The Results
Franchisor sentiment toward access
to suitable franchisees was more
subdued up 1% to a net 12%.
Service Providers, however were far
more positive with an increase of
net 16% to net 21%.

9. The Results
Franchisors remained constant and
subdued in sentiment toward the
availability of suitable staff at a net
negative 13%, down from net
negative 12%. Service Providers
were moderately more positive at a
net 5%, although down on the
more positive net 5% in July. Clearly
finding suitable staff is a key
challenge and one that is envisaged
to worsen, on balance.

10. The Results
The ongoing fluctuations in access to
suitable locations continued this
quarter, decreasing from net 6% to net
negative 13% for Franchisors.
Service Providers sentiment on the
other hand was equally more positive
up from net 5% to net 26%.
•Franchisor sentiment towards access to suitable locations was again positive increasing from net 3% to 6%. Service Providers dropped back to net 5%, after

11. The Results
The dip in the outlook for operating
costs in July has improved slightly
for Franchisors this quarter from
net negative 6% to a net 0%.
Service Provider outlook for
franchisee operating costs has taken
a further dip decreasing from net
5% to a net negative 11%.

12. The Results
Both Franchisor and Service Provider
sentiment for franchisee sales levels
showed a further positive increase
this quarter, with the franchisors
increasing from a net 51% to net 63%.
Service Providers, whilst overall
slightly less positive than Franchisors
showed an increase from a net 30% to
a net 42%

13. The Results
Sentiment toward franchisee
profitability levels continue to
fluctuate up and down between
Franchisors and Service Providers.
Franchisor sentiment grew in
confidence, up from a net 40% in July
to a high net 49% in October.
Service Providers by contrast reduced
forward looking sentiment, down net
19% on the July net 40%, leaving
October at a net 21%.

14. The Results
Franchisor and Service Provider
sentiment toward access to financing
bounced back significantly for
Franchisors from net 0% to net 15%,
whilst the increase for Service
Providers was less confident at net
0% up from negative net 5%.

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