Franchises top $46.1b in NZ

The annual turnover of New Zealand’s franchising sector has topped $46.1 billion, according to a new report. Massey University carried out the Franchising New Zealand 2017 survey in collaboration with the Griffith Business School, and estimated turnover in the franchising sector has grown 67 per cent in the past five years. Report author Susan Flint-Hartle said franchise brands grew from 446 to 631 in that time, and 72 per cent of those brands were domestic. There are now approximately 37,000 franchises operating in New Zealand, according to the report, employing over 124,000 people. “It is encouraging to see such large growth in franchising with an increase of around 185 new brands entering the market since the last report in 2012,” said Franchise Association chief executive Robyn Pickerill. “Many existing brands have also experienced considerable internal expansion.” The retail sector was identified as a key area of growth, seeing the most significant increase in turnover over the period studied in the report, followed by tourism and construction. Record immigration has also boosted the franchise industry in New Zealand. Over half the survey respondents said there was significant migrant franchisee ownership, particularly amongst migrants from China, India, South Africa and the UK. E-commerce is also growing in the sector, with 60 per cent of franchise brands now utilising online sales and Facebook. “I think the sector is starting to embrace new trends, they are adapting to the online sales environment and using social media for customer and business-to-business communication,” said Flint-Hartle, but added she would still characterise it as a “slow acceptance.”