Quoting the research results from FASA’s recent franchise survey, which showed that despite a tough economy, the franchising sector continues to grow, the FNB Franchise Leadership Summit brought together speakers that identified key trends in this dynamic space.
1. More Multi-Unit Owners, and franchisees owning multiple concepts
What happens once you have mastered the tried and true formula franchises have designed for their franchisees? If you’re like many franchise owners, you start opening another location. And then another. By recreating your success in multiple locations, you can quickly grow your revenues and increase your business’ sustainability. Many franchisee owners are also opening other, non-competing franchise offerings as they grow their businesses in an effort to diversify earnings.
2. Smaller, more cost-effective franchise models
Among the new frontiers in franchising is the food court losing its legacy as the preferred setting for food franchises, as service stations increase in popularity in the industry. Many brands – including Steers, Debonairs and Mugg & Bean On-the-Go outlets – are co-locating with major fuel retailers to create fully-integrated accessible centres. Looking at new, less expensive alternate locations beyond the shopping malls and strip malls to expand into stand-alone kiosks, food trucks, corporate catering, campuses, sporting events, craft markets, is a major trend.
3. Niche markets
Consumers increasingly prefer local businesses over national brands. Some of the bigger brands are looking for creative ways to tackle this situation by tagging with local businesses and this trend is on the rise. Niche markets are gaining traction. Whether it’s in offering a unique ‘gourmet’ food experience, craft beer or whether it’s in the environmental space of energy saving technology or recycling, these are where many new opportunities are to be found. With the increase in social awareness, social responsibility is a part of any business, small or big. The current generation of consumer is challenging the role that business plays in society and franchises have wonderful platforms to play a positive role and in so doing win customers.
4. Increased customization/ personalisation
In a world of increased consumer choice, it is no longer about what you have on the menu; it is now about how your product or service can be tailor-made to what a customer really wants. The success of RocoMamas speaks to this – with 61 franchise outlets their business model clearly responds to the essence of this trend by allowing consumers to create their own burgers, and increasingly consumers want the ability to create their own dining experience.
5. On-demand products/ services
Amazon is a great example of this – same day delivery is becoming the norm in the age of instant gratification – I want it now! Differentiation through delivery remains a big opportunity.
6. The significance of online and social media
Social media is how your customers choose to interact with brands, whether to express anger, inquire or to show appreciation. It is no longer about the question of should a business use social media or not, it is now more about how a business uses social media. Today’s digital-savvy customers are highly choosy about online buying. Some key points to consider:
You need a Responsive, Interactive and up-to-date Website;
Customers should be able to view your website perfectly on any device;
Data Analytics is Important – Like it or not, your data is what drives your business; and
Seamless and Safe digital payments are critical.
There is no doubt that franchising not only offers viable business opportunities, but also ensures that franchisees are better equipped to weather the tough economic environment. FNB Business remains committed to helping grow this very important sector and is well positioned to provide solutions supporting franchising as it evolves with these themes. (Source: FNB Franchising)
Are we finally going to be able to shop at the big malls without being charged exorbitant parking fees? Well, one of the property groups has confirmed that it will scrap parking fees at some shopping centres next year.
Redefine Properties, which owns Centurion Mall, Maponya Mall, Southcoast Mall, Benmore Centre, Blue Route Mall, Riverside Mall, Kenilworth Centre and Wonderboom Junction, in a report by Business Insider, will scrap parking fees at some shopping centres and have a capped parking fee of R5 everywhere else.
A trial run in July by the group found that by reducing or removing parking fees, more customers visited the centres and spent more. It seems that finally, malls have realised that it doesn’t make sense to penalise customers for staying longer at malls.
Here’s hoping that other shopping malls follow suit!
In another shopping centre development, Sandton City, in an interview with 702 has confirmed that, for the first time in 45 years it is fully let and is trading around 44% above other centres. This is quite an achievement given the economic downturn and the proliferation of shopping malls which has led to vacant shops in most malls. It also confirms that it has signed up, in the past three years, more luxury brands than any other shopping centre in the country.
At the launch of Ipsos South Africa’s inaugural survey measuring the influence that brands have on South Africans, Pick n Pay topped the field in the Top 10 Most Influential Brands in South Africa. The winning top ten are all rooted in South Africa, retain and uphold the traditional uses and values of the brand yet continue to move forward to address what their customers need with line extensions and upgrades when needed.
The top 10 Brands Most Influential Brands in South Africa are:
Pick n Pay
The Most Influential Brands study unveils and ranks the most influential brands in South Africa, and offers a case study perspective on the dimensions that drive each brand’s influence. These dimensions, which differ slightly from country to country include a brands perceived ‘Leading Edge’, ‘Respect’, ‘Presence’, ‘Trustworthiness’ and ‘Engagement’.
“Far from being a popularity contest amongst brands, this study speaks to the actual influence that a brand has on South African consumers’ everyday lives,” says Ray Kong of Ipsos.
Some interesting themes that have arisen amongst the South African brands include:
The significant influence of Retail:
Out of the Top 10 Brands, 4 are retail names, probably as a result of retail outlets becoming a one-stop household management destination, by offering banking services, payments on utility bills and licences, as well as becoming distribution points for social grants and allowing people to send money to each other quickly and effectively.
Local is Lekker:
Many local brands sit at the top of the list, and this is in contrast with many other markets around the world. Localisation speaks to the fundamental needs of a community and these brands have excelled at making consumers feel understood.
Accessible for the People:
The essence of most of these brands is that they are inclusive, relatable and warm which speaks to the principle of UBUNTU that is ingrained in South African culture and way of life.
South Africa really is unique in the brands that have come out tops when comparing it to the top-10 lists in other markets, which has been dominated by digital and tech brands. WhatsApp is the only digital brand to make the South African Top 10 and has taken off in a big way in South Africa because of the simplicity and affordability in using this service.
Rooted yet Progressive
The brands that have emerged at the top of the influence scale are those that are rooted in South Africa, retain and uphold the traditional uses and values of the brand yet continue to move forward to address what their customers need with line extensions and upgrades when needed.
For more info on the survey and on Ipsos email Mari.Harris@ipsos.com or visit www.ipsos.com
At the Signarama World Expo which recently took place in Cancun, Mexico. Signarama Southern Africa franchisor, represented by Kurt Tyack, received the award for the Master Partner of the Year as the top performing Signarama country network in the World (outside of the US and Australian markets).
The award is the culmination of a great deal of hard work, and was accepted with a great deal of pride by Kurt Tyack in Cancun. “This award is testament not only to the work put in by everyone at the Signarama support office in South Africa to develop and grow the brand, but also the hard work put in every day by our incredible network of franchisee partners”, explained Tyack.
The event is the meeting place for Signarama franchisor and franchisee partners from around the World. The event is an opportunity for everyone to learn the best practices across various aspects of the business, to receive motivational messages from top international business experts, to receive updates on the latest global technologies in the signage and branding industry, and importantly to recognise the top achievers in the Signarama network.
Kurt Tyack proudly displaying the Master Partner of the Year Award
The hard work by the Signarama franchisee partners is no more evident than in the case of Pretoria North franchisee, Francois Schoeman, who was admitted to the Signarama Global Million Dollar Circle. Schoeman, the current Signarama Franchisee of the Year in South Africa, was in Cancun to accept the award. Admission to the Million Dollar Circle is no mean feat – this is an exclusive club of Signarama franchise owners who have exceeded sales of US$1m in a calendar year.
In the process of achieving this, Schoeman has achieved several milestones in South Africa. His recent move to a larger 1200 square metre manufacturing facility has allowed him to improve service and turnaround times for his clients. “Being part of the Signarama brand has really helped me to grow a successful, profitable business”, said Schoeman. “I was extremely proud to accept the award on behalf of my team at Signarama Pretoria North. The Cancun trip was a real eye-opener, and being able to learn from the franchisor and from other franchisees and share their success has ignited the fuse for our future growth. We have a plan to double sales and profitability within 24 months.”
Francois Schoeman (L), receiving his Million Dollar Circle Award from Global brand president, AJ Titus
The event has also provided some valuable insight into where the industry is going, and what is possible when owning a Signarama franchise. The top performing Signarama franchisee globally has sales in excess of US$7m annually. In an industry where technology is evolving, the knowledge shared across the Signarama network ensures that Signarama clients are assured of excellent products, quality, and service.
If you require any signage or branding please visit www.signarama.co.za to get in touch with your local expert. If you are interested in owning a Signarama franchise please visit www.signfranchise.co.za to find out more about this dynamic business.
Sanlam has, for the fifth year, confirmed its sponsorship of the Franchise Association of South Africa (FASA)’s Franchise Surveys. The surveys are an important barometer that track the success of this unique business system which in the latest survey shows an estimated turnover of R721 billion equivalent to 15,7% of the total country’s GDP. Its 865 franchise systems support over 45 000 outlets operated by franchisees who in turn employ 369 573 people.
This contribution to the South African economy by the franchise sector has continued on an upward trajectory in spite of adverse economic conditions, socio-political factors and often challenging business regulations.
The Franchise Association of South Africa (FASA), which has represented the sector for the past forty years, welcomes the forward-thinking intentions of President Cyril Ramaphosa and Finance Minister Tito Mboweni who promise a ‘new dawn’ for the country, with the need for strong public/private partnerships’.
President Ramaphosa’s comment that ‘we should treat our entrepreneurs as heroes and stop treating our business people as enemies’ is welcomed and appreciated by the thousands of entrepreneurs and businesses that make up the backbone of our country, says Vera Valasis, Executive Director of FASA. “As a sector that is often overlooked as we operate universally over all sectors, we have, since those first franchises established themselves in the 1960’s, continued through the good and bad times to innovate and establish new businesses, develop skills and above all contribute to job creation. The fact that over 80% of our franchise brands are home-grown is testament to our commitment to growing the economy for the benefit of all its people.”
Sanlam, which offer financial services geared at helping sustainable businesses through surety protection, continuity cover, income protection cover and investment solutions, have a vested interest in ensuring that businesses and franchises continue to grow and prosper. “Our role as financial service providers is to give businesses the necessary financial tools to ensure that they operate sustainably to succeed” says Kobus Engelbrecht, Marketing Head: Sanlam Business Market. “The franchise sector has proved, through its stellar growth over decades that it is one of the most dynamic business formats of our time and we are proud to be able to play a part in tracking their success.”
Says Vera Valasis, Executive Director of FASA, “Sanlam’s brand has become synonymous with the annual franchise survey and without the company’s absolute belief in the economic contribution brought by entrepreneurs much less would be known about the incredible role franchising plays in job creation, skills development and enabling financial freedom for many a successful franchisor and franchisee. We thank Sanlam for their contribution and commitment to improving the credibility of franchising as a successful business model.”
The Sanlam/FASA Franchisor Survey tracks the industry performance of Franchisors and the Franchisee Survey looks at the satisfaction levels of the franchisees that operate within those brands. Download Sanlam Franchise Surveys
South Africa’s foray into the Black Friday frenzy, which is one of the most important pre-Christmas shopping days in the USA marking the beginning of the holiday shopping season – saw both retailers and consumers take to this new marketing trend – and this year should prove to be bigger and better.
South Africa’s foray into the Black Friday frenzy, which is one of the most important pre-Christmas shopping days in the USA marking the beginning of the holiday shopping season – saw both retailers and consumers take to this new marketing trend – and this year should prove to be bigger and better.
Although started only a few years ago, according to Bankserv, Africa’s largest automated payments clearing house, 4,7 million card transactions were processed for Black Friday 2017. That’s R2.5 billion worth of card transactions. According to the survey the most expensive single transaction for Black Friday was valued at R1 million. The highest volume hour for transactions for both Black Friday and Cyber Monday was between 4pm and 5pm, pointing to product and price spurring people to rush in after work.
Based on the premise that 50 percent of holiday shoppers start researching gift ideas as early as October or even earlier, the idea of promoting Black Friday specials early both on-line and in store is important to generate the necessary hype for that all important date and beyond to Cyber Monday.
With online playing such an important role in pre-promoting the event experts suggest a special Black Friday landing page that has a countdown clock and that personalised communication starts early to make your brand and offerings top-of-mind. The key to the success of Black Friday lies in convenience – if it’s in the bricks and mortar arena, creating the ‘call to action’ to be the first in line for specials is crucial; if it’s online sales, having efficient ordering and delivery mechanisms in place to ensure a seamless order-to-door service.
Linking Black Friday to the holiday season is also crucial as you want to retain those customers and encourage them to continue to shop through to Christmas. By giving consumers a good Black Friday experience, you can then lock them into carrying that shopping momentum through to Christmas and beyond.
Convenience in today’s stressful, time-constrained lifestyle is what global measurement company Nielsen has found in its survey on global consumer needs. A cue to manufacturers and retailers to get on board with products and services that caters to this new trend.
Asked in the survey which products they ‘wish were on the market but are not;
40% want products that make their life easier,
36% would welcome more products that are convenient to use,
25% wanted products for small families and households,
25% wanted products tailored to a specific need.
Although convenience means different things to different consumers around the world, depending on their circumstances, culture, location, market maturity and access to technology, the needs are underpinned by consumers’ search for ease, utility and simplicity in three areas: consumption, shopping and engagement experiences.
Some of the key areas that South African consumers wanted convenience in included:
Meals on demand
This area of convenience has the biggest uptake in the ready prepared and on-the-go meal solutions, home or office grocery delivery offerings. The survey showed that one third (34%) of South African consumers are now using restaurant deliveries (e.g. Uber Eats and Mr Delivery) or meal kit services (e.g. UCook and Daily Dish) up from 29% in 2017, and 19% in 2016. Large retailer Checkers recently launched its own in-store meal kit service.
Fast food on the rise
Despite having to tighten spending, the fast food, quick service industry & street vendors showed an increase, with 63% of local consumers having visited a fast food outlet in the past six months, 55% opting for casual dining and 34% visiting a formal restaurant. Lunch and dinner are the meals most likely to be substituted with out-of-home dining options, with 50% opting to eat outside on a monthly basis, 18% weekly and 31% less often.
E-Commerce on the rise
Whilst the e-commerce market in South Africa is not growing as fast as other countries – where FMCG online sales are growing at estimated five times faster than offline sales, manufacturers and retails should prepare for the online e-commerce onslaught based on the Nielsen research which showed 45% of respondents would definitely buy if retailers provided same day product replacement service for products that aren’t currently available; 43% said a precise delivery window (at 30 minute intervals) to fit their schedules and 41% said a website that provides real-time detailed progress on the status of their order. Another 36% said they would like to see online retailers who would allow them to make special product requests to suit their needs.
FASA represents around 17 business sectors in South Africa – a figure that pales compared to other countries that boast anything from 50 to 70% of their business sectors going through the franchise system. FASA is proud to welcome BeztForex as a member that is spearheading a completely new category in the Financial Services franchise sector, offering exciting franchise opportunities in banking space of providing Foreign Exchange products and services to importers and exporters from all market segments.
Why invest in a BeztForex franchise, a financial service franchise?
BeztForex was founded in 2012 by Ex International Banker, Herman Bezuidenhout, following a 33-year career within the FirstRand Banking Group. He now has 40 years’ experience as an international banker within leading South African financial institutions and as an entrepreneur, encompassing marketing, sales, operations and general management, at senior management and executive levels.
BeztForex has been operating since March 2012 and is currently the largest FX intermediary company in Sasfin Bank. The success of BeztForex can be attributed to the following key elements:
Client centric approach – we are obsessed with client service!
Sasfin Bank alliance and business model
Unique FX trading, payment and risk management online portal
The BeztForex team has combined global trade, foreign exchange and international banking skills of more than 100 years. You will be joining a team of highly experienced international bankers.
We equip our Franchisees to be successful by providing them with a proven business system. We constantly develop our business system to ensure our growth as well as the growth of our Franchisees.
Benefits of owning a BeztForex franchise:
Fully regulated Financial Services Business, with its focus on providing foreign exchange services to importers, exporters and investors.
Import/export industry in South Africa accounts for more than 60% of South Africa’s GDP.
Aligned to a recognised and respected national and international brand.
A proven, secure, low cost and profitable business model.
No need for staff, stock, premises or operational structures.
The only franchise of its kind in South Africa.
Strong and clearly differentiated product offering.
Strong operational and training support team.
Profile of ideal BeztForex Franchisee
BeztForex is a banking franchise with its core focus on the provision of Foreign Exchange products and services to importers and exporters from all market segments. The target market includes small, medium and large clients as well as high net worth individuals.
Due to the unique business model of BeztForex where most back, middle and front office functions are outsourced to our banking partner; the main component of the franchise is the focus on new client acquisition as well as maintaining relationships with existing clients.
Naturally, foreign exchange and global trade skills and experience will be a major advantage; however it is not essential as the Franchisor will provide intensive on-the-job training for prospective franchisees that otherwise meet the qualifying criteria to be a BeztForex franchisee.
Skills, knowledge, attributes, qualifications and characteristics required are as follows:
Leadership and Managerial skills
General Banking Skills (will be an advantage)
Foreign Exchange and International Banking Skills (will be an advantage)
Obsession with client service
Existing registration with the Financial Sector Conduct Authority as a FX representative (FSB) (will be an advantage)
Matric and an approved FSCA qualification. (Qualifying franchisees will have 2 years to pass the FSCA regulatory exams and a further 4 years to gain an approved FSCA qualification). Many degrees, diplomas and other certificates qualify as approved qualifications. Qualifying franchisees that are not currently registered with the FSCA, will be registered under the licence and supervision of the franchisor. It follows that all franchisees must be “fit and proper” from an FSCA perspective.
The FSCA’s “Fit and proper “requirement means that franchisees must at all times comply with:
Honesty and Integrity requirements that are applicable to all FSPs, key individuals, representatives and compliance officers.
Competency requirements that consist of experience and qualification requirements that are applicable to all FSPs, key individuals and representatives.
Operational ability requirements that are applicable to all FSPs, key individuals and representatives.
Franchisee must be solvent and maintain clean financial positions.
An Authorized Financial Services Provider – FSP 44383.
Authorised by the South African Reserve Bank to operate as a foreign exchange intermediary company.
Registered with the Financial Intelligence Centre.
Accredited Sasfin Bank Foreign Exchange Intermediary.
Accredited Sasfin Bank Business Introducer.
Accredited Foreign Exchange and Global Investments Introducer for SCM DMA (Pty) Ltd, trading as DMA (Direct Market Access), a subsidiary of Sasfin Group as well as Saxo Bank Group Denmark.
About Sasfin Bank: Sasfin Bank is an independent and diversified banking and financial services group and has been listed on the Johannesburg Stock Exchange since 1987. Sasfin’s products and services are designed to protect and grow its clients’ financial assets and are integrated to create a bespoke solution for their specific needs.
About Saxo Bank: The Saxo Group is a leading multi-asset trading and investment specialist and a fully licensed bank under the supervision of Danish FSA, headquartered in Copenhagen and operating in financial centers around the world including London, Paris, Zurich, Dubai, Singapore, Shanghai, Hong Kong and Tokyo. Saxo facilitates trading and investing for private and institutional clients, providing access to global markets and a broad range of asset classes and tradable instruments. All unified on their robust and intuitive trading platforms, incorporating everything from personalized watch lists to tailored charts, news filters and risk management tools.
With Minister of Finance Tito Mboweni’s mini-budget speech still resonating and giving some hope with his call that ‘together, as a country, we can rebuild and recast our future… and choose a path that takes us to faster and more inclusive economic growth and strengthens private and public sector investment,’ the Franchise Association of South Africa (FASA) signs a Memorandum of Understanding (MOU) with the Small Business Institute (SBI).
According to Vera Valasis, FASA’s Executive Director ”the collaboration with SBI will provide FASA with an official ‘voice’ to be represented and lobby through the SBI at BUSA level on business related issues that arise on a regular basis. We hope our involvement with both the SBI and BUSA will help strengthen the voice of small business and franchising in particular to government.”
The Franchise Association of South Africa (FASA) has a proud 40 year history of nurturing entrepreneurship through the franchise business system and oversees an industry that today boasts 865 franchise systems, over 40 000 small businesses employing close to 400 000 people and contributing R721 billion equivalent to 15,7% of the total South African GDP.
“Through a wide range of socio, economic & political challenges over the past four decades,” says Vera Valasis, Executive Director of FASA, “franchising has continued to make an important contribution to the economy. We want progressive leaders in government such as President Cyril Ramaphosa and Minister Tito Mboweni, both with impeccable business credentials, to recognise that the franchise sector has and can continue to play a crucial role in entrepreneurship, skills transfer and job creation. We recognize the importance of the business community rallying together to ensure that with strength in numbers, it can grow to benefit all in our country. To this end, FASA has embarked on a number of collaborations with like-minded institutions and organisations like SBI – with the express intention of playing our part along that road of prosperity and opportunity that Minister Mboweni has chosen.”
FASA, whose members are franchisors, franchisees, professional service providers, product suppliers and individuals and whose mission is to promote ethical franchising and the SBI, a non-profit (NPO) organization constituted to promote the economic and business interest of its more than 100 chamber organization members and thousands of SMEs in the wider economy, share a common goal and look forward to collaborate in the following areas of mutual interest:
Government and other stakeholders lobbying
Government and other stakeholder lobbying
Dissemination of industry information
Reciprocal promotion of industry events
The SBI is a member of Business Unity South Africa (BUSA) and stand for:
Market-led job creation
Inclusive economic growth
For SMME’s, one of the biggest challenges and obstacles to overcome and boost economic growth, is the regulatory environment. Winda Austin-Loeve, SBI President, says, “influencing the regulatory environment through the SBI’s representation on BUSA is one of the main reasons for the MOU between the SBI and FASA. The SBI will lobby on a national level on behalf of all its members and partners in an attempt to get legislation and regulations passed that create a favourable and friendly climate for SMME’s to build and grow long-term sustainable businesses that will ensure job creation and economic growth.”
A ground-breaking initiative by the Nikela Charity Funding & Development Fund with the aim of raising R1 Billion every year for social upliftment, of which FASA was one of the first signatories, was launched in celebration of Archbishop Desmond Tutu’s 87th birthday in early October.
Rounda, which is a Public-Private Initiative, driven by Civil Society, with the full backing of Government and support from major South African business industries, encourages the public to make every cent count and is a way for all of us to play our part to eradicate poverty in South Africa.
In addition to having a high inequality rate, South Africa has one of the highest official unemployment rates in the world, with 12 million people living in extreme poverty and one in four South Africans going to bed hungry every night. Rounda is the effective collection of small change for poverty eradication, which will mobilise a nation of givers and contribute to a positive impact on the social fabric of our nation.
The soft launch of Rounda commenced in April 2018 and to date has raised over R1 Million collectively with participation from McDonald’s, Nandos, Steers and Mimmos franchises, with Mochachos and Spur the next companies to join forces with Rounda. According to Mr Sipho Shezi, Vice Chairman of the Nikela Trust, ‘it takes leadership from big companies such as Nandos, Steers, Mimmos and McDonald’s and we thank them for taking the lead and being the first to implement Rounda in their stores.”
Daniel Padiachy, CMO of McDonald’s South Africa says: “As McDonald’s South Africa, we resonate with Rounda and are proud and excited with this partnership and the difference it will make to their recipients. Our partnership with Rounda gives us the opportunity to not only help fight poverty but also benefit our own Ronald McDonald’s House Charities, RMHC, which will continue to contribute to the care, compassion, hope and love shown to families of critically ill children treated in hospitals in South Africa.”
Adolf Fourie, Marketing Executive at Steers added: “We are humbled by the opportunity to be a part of this great initiative. We have already seen the impact we make in communities with our partners in SHOUT and we are excited that Rounda offers a permanent mechanism to help fight hunger and poverty.
The roll-out of Rounda will be through a phased approach and South African Citizens can look forward to seeing more Rounda programs being implemented in association with the following industries and associations:
The Franchise Association of South Africa
The Banking Association of South Africa
The Restaurant Association of South Africa
Federated Hospitality Association of South Africa
Association for Savings and Investment South Africa
South African Payroll Association
Fuel Retailers Association
Afrikaanse Taal en Kultuurvereniging (ATKV)
The aim of the Nikela Trust through Rounda is to enable all South Africans to voluntarily contribute towards poverty eradication and thereby uplift the national. Round does not discriminate and is truly the first initiative where everyone can be involved, from Big Business all the way through to individual consumers, thereby encouraging an active citizenry.
Rounda allows for all people, civil society and all types of business to become part of this movement and nation building project. The vision for Rounda is to become the new symbol of the Rainbow nation! An action call to rally around the fight against poverty together and the reconstruction of the social fabric of society.