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New Zealand Franchising Confidence Index | October 2011
[object Object]
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 36 franchisors and 22 service providers.,[object Object]
Both franchisor and service providers’ outlook for general business conditions deteriorated substantially from the FCI’s highs of July. Franchisors were less optimistic (net 6%), dropping 35% from the net 41% recorded in July. Franchising service provider confidence levels dropped 42% to a net 23%, from the previous July quarter.,[object Object]
Both franchisors and service providers registered falls in sentiment for franchisor growth prospects. Franchisors net sentiment fell from 39% in July to 17%. Meanwhile, service providers’ confidence (net 14%) took back 41% from their optimistic 55% in the previous quarter. ,[object Object]
Repeating the trend a year ago for the same quarter, franchisors’ attitudes for access to financing plummeted back to a negative state (-19%). Service providers managed to remain relatively positive but fell to a low 9%.,[object Object]
Both franchisors (net -8%) and service providers (5%) broke new lows in their outlook for access to suitable franchisees, underlining the recruitment challenges faced by many franchise systems.,[object Object]
Access to suitable staff had the only contrasting movement in confidence in the survey between franchisors and service providers. Encouragingly, franchisors responded positively, climbing to a net 17%. On the other hand, service providers declined to 14%.,[object Object]
Up 15% from July, franchisors felt more optimistic about finding suitable locations (net 22%). Service providers remain constant in their expectation (net 32%).,[object Object]
Franchisors (22%) and service providers (14%) are less positive in their outlook for sales levels per franchisee. Sentiment toward franchisee operating costs remained firmly in negative territory with franchisors and service providers reporting a net -31% and -27%, respectively. Sentiment for franchisee profitability levels also fell. Franchisors’ outlook for franchisees bottom line fell to 3%. Comparatively, service providers combined for a net    -23%, after a year of limited optimism in their outlook for franchisee profitability levels. ,[object Object]
[object Object]
Finding suitable franchisees remains a challenge.  However, franchisors are more positive in accessing suitable staff.

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