April 2015 Quarter Results

FRANCHISING SENTIMENT REMAINS POSITIVE

• Franchize Consultants is the first point of contact for

companies considering franchising their business

• Franchize Consultants helps established franchised

(and other network format) chains review and improve

performance for both franchisors and franchisees

• Franchize Consultants conducts specialist research for

franchising insight and practical application

• Franchize Consultants builds franchisor executive and

franchisee capability and performance through focused

training and education programmes

About Franchize Consultants

Key Survey Highlights

• Responding Franchisors and Service Providers remain

optimistic across many key growth drivers.

• Franchisors sentiment toward general business conditions

is still high

• Franchisors remain positive about franchisee profitability

prospects – arguably franchising’s most important key

performance indicator.

• Franchisors forecasts indicated a negative outlook for the

availability of suitable staff and operating costs

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 29 franchisors

and 11 Service Providers.

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?

Respondents indicate whether they expect the following aspects to be better, the sameor worse over the next 12 months (compared to the previous 12 months)

The Results

The latest results indicated positive franchisor (net 41%) and Service Provider (net 36%) sentiment toward general business conditions. These results were higher than the latest results of other more general business surveys including the ANZ Business Outlook (35.8% in March) and NZIER (20% in March) business confidence surveys.

The Results

Franchisor growth also remained high (net 59%), up slightly from the previous quarter. Service Providers were less optimistic reporting 27%.

The Results

Franchisors sentiment toward accessing financing decreased from 41% to 28% ,Service Providers were also less positive than last quarter at 36%, dropping from net 88%

The Results

Franchisor sentiment toward access to suitable franchisees remained the same this quarter, at a positive net 17%. Service Providers were more optimistic at net 55%.

The Results

Franchisor confidence in access to suitable staff improved slightly, from negative net 18% to negative net 7%. Service Providers were down from last quarter at 0%

The Results

Franchisor sentiment towards access to suitable locations decreased from net 12% to net 7%. Service Providers reported a net 9%.

The Results

Franchisor sentiment towards franchisee sales remained positive, at a net 38%, though this is down from net 62% last quarter. Service Providers decreased to net 45% from 80%

The Results

Franchisor confidence in operating costs were lower than the previous quarter. Franchisors reporting a negative net 10% and Service Providers reporting negative net 9%

The Results

Sentiment toward future franchisee profitability was positive. Franchisors reported an increase from net 38% to net 41% and Service Providers a net 55%, up from net 40% in the last quarter.

More Information

www.franchisingconfidence.co.nz

Including:

• More detailed and complete results and analysis

• All charts and illustrations

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