1. October 2019 Quarter Results
Franchisor Sentiment Falls

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3. Key Survey Highlights
• Franchisor outlook for general business conditions
dropped after a brief rise in July to the lowest seen in the
history of the survey.
• Franchisor sentiment for franchisor growth was less
positive this quarter, whilst Service Providers remained
stable.
• Responding Franchisors and Service Providers both
indicate operating costs per franchisee as there main
challenge
• Franchisors sentiment indicated access to finance has
become a greater concern
• Franchisors indicated sentiment towards availability of
suitable staff and franchisees as a key challenge

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 25 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?
6. What do you see as the greatest challenge to
franchise development in 2019?
7. What will provide the greatest opportunity to
franchising development in 2019?
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
Franchisor outlook for general business
conditions dropped after a brief rise in July
(net 10%) to net negative 32%, the lowest
seen in the history of the survey. Service
Providers sentiment improved from net 0%
to net 21%.

7. The Results
Franchisor sentiment for franchisor
growth prospects, was less positive from a
franchisor viewpoint at net 4%, down from
net 50%. Service Providers however
remained stable at net 7% up from net 6%.

8. The Results
Franchisor sentiment toward access to
financing continues to be challenging with
the sentiment oscillating quarter to
quarter. After last quarter’s rise in
sentiment to net negative 5% it has
dipped to net negative 44% this quarter.
Service Providers sentiment is less
concerned recording net 7% up from net
6%.

9. The Results
Franchisor sentiment toward access
to suitable franchisees, after a brief
softening, has reverted to a key
challenge once again at net negative
60%, down from net negative 10%.
Service Providers again were stable in
their sentiment at net 7%, up from net
0%.

10. The Results
Franchisor sentiment for access to
suitable staff has remained stable in
October at net negative 38%,
however still remains a key area of
focus. Service Providers sentiment
eased to net negative 7% up on the
net negative 25% previously.

11. The Results
Franchisors sentiment toward finding
suitable locations at net 4% (previously
net 11%), whilst still an area requiring
focus, is staying stable. Service
Providers continue to be more positive
at net 14%, although down from a
previous net 53%.

12. The Results
Franchisors sentiment toward
future sales levels per franchisee
remains buoyant in comparison
with other areas, at a net 24%
(previously net 50%). Service
Providers sentiment is similar at net
14%, down from net 25%.

13. The Results
Franchisee operating costs has
always been a very challenging area
and remains so from both
Franchisors and Service Provider
viewpoints. Franchisors sentiment
dipped slightly, from a net negative
30% to a net negative 36% for
October. Service Providers sentiment
eased slightly but remains at very
low levels with net negative 57%.

14. The Results
Franchisor sentiment regarding
franchisee profitability levels, after
showing a steep improvement for July
at net 25%, has dipped back to net
negative 12%. Meanwhile, Service
Provider sentiment remained low at
net negative 43% in comparison to net
negative 50%.

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