Latest results from Franchize Consultants' survey of New Zealand Franchising Confidence

3. 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.

5. Franchisors (blue line) sentiment toward general business conditions (net -3%) has substantially deteriorated. Franchise service providers (e.g. banks, consultants, accountants and lawyers to the sector) were more optimistic (net 35%).

6. Franchisors are still generally positive about forthcoming growth prospects for their organisations (net 36%), however optimism has dampened from January (net 54%). Service providers (net 40%) shared franchisors current optimism for growth.

7. Franchisors expect access to capital to remain challenging (net -10%). Meanwhile,service providers (who include banking respondents) are considerably more optimistic (net 40% positive) for franchisors compared to January (8%). Franchisor expectations regarding financing have now been negative for 12 months.

8. Whilst improving marginally, franchisors expect franchisee recruitment to remain challenging (net 5% up from 3% in January 2011). Comparatively, service providers are considerably more positive in their outlook (net 45%).

9. Meanwhile, franchisor and service provider perceived access to suitable staff are aligned and firmly positive reporting net 36% and 35%, respectively.

10. Franchisors and service providers are positive, although less optimistic about franchisor access to suitable locations than January.

11. While expectations for franchisee sales levels stabilise (net 33%), franchisor expectations for operating costs (net negative -38%) and profitability (net negative -3%) both deteriorated from the previous quarter. Franchisor expectations for franchisee profitability are now negative on balance for the first time since the survey began a year ago.

13. Reported earthquake impacts on franchisors and franchisees can be found in the full survey report.

14. Franchisee profits are expected to remain challenged. On balance franchisors expect franchisee profits to deteriorate.

16. All charts and illustrations

18. For further information contact Dr Callum Floyd

19. Ph. (09) 523 3858

20. Mob. 021 669 519

21. Email. callum@fcnzl.co.nz

22. Web. www.franchisingconfidence.co.nz

23. Web. www.franchize.biz