Franchise industry optimistic

About 72% of franchisees in South Africa reported an optimistic outlook about the future in the face of economic challenges, according to a 2015 survey by the Franchise Association of South Africa (Fasa). The franchise industry now contributes 12.5% to South Africa’s gross domestic product (GDP) is now at 12.5%. In monetary terms the franchise market is worth an estimated R456bn.

There are 17 business sectors through which franchising contributes to GDP. The largest contributing sectors are quick service restaurants and restaurants (24%), retail (12%) and building, home and office services (11%). Automotive products and services, childcare, education and training and business to business occupy 24% of the franchise market (9%, 8% and 7% respectively).

According to Fasa, there are currently 627 franchise systems or franchisors in South Africa. There are 39 119 franchise stores and most of these are operated by the franchisees, who form the backbone of the franchise industry. The total number of employees in the franchise industry is estimated at 329 245, with 34% being employed in retailing, 27% in fast foods and restaurants, 12% in real estate and 10% in the automotive  sector.

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