Welcome to a bumper edition of our newsletter. In this issue, we inform you of the latest developments in franchising in the USA and around the world. We start with a report by Trudi van Niekerk, GM of Absa Franchising, who attended the IFE conference and used the opportunity to familiarise herself with the current status of franchising in the US.
We also highlight a potentially serious legal threat to franchising in South Africa and tell you how to get the best out of IFE 2007, regardless of whether you are an exhibitor or not. Next, we bring you some general news, including the rundown on Famous Brands' takeover of Wimpy UK . We also have news on an initiative launched by Franchising Plus to develop new franchisors and focus groups held with women in franchising. We end today's edition with some readers' questions of general interest and the answers our expert panellists provided.
The International Franchise Exposition, presented annually under the auspices of FASA, is South Africa 's (and Africa 's) premier dedicated franchise exhibition. It serves as a meeting place for the who‘s who of franchising in South Africa and has, in the past, attracted close on 10 000 high quality prospects. Expectations are that this year, this figure will be exceeded.
Whichfranchise has its own stand. If last year's experience is anything to go by, it will be a focal point of the expo. It will be dedicated to the promotion of our website, with emphasis on our advertisers and franchising in general. A live link to the Internet will enable visitors to access the website from our stand. We also had 10 000 brochures printed which we plan to hand out to visitors during the show.
Following this additional push, we confidently expect our advertisers to receive record numbers of enquiries for their franchise opportunities. Should you wish to become part of this illustrious group, contact us by emailing anita@whichfranchise.co.za Alternatively, we would welcome your visit at the expo. Come and see for yourself what whichfranchise has to offer!
Participation at the recent Annual IFA Conference which was held this year in Las Vegas , Nevada , allowed me to gain some first-hand insights into the way US franchisors think. I was also able to draw some, albeit superficial, comparisons between franchised outlets there and here, especially in the fast food sector.
Although seasoned observers of the sector continue to insist that saturation point in franchising is far off, fact is that an increasing number of the longer-established franchisors see the bulk of their expansion coming from countries abroad. They see enticing opportunities in Europe (especially Eastern Europe), South America , Australia and Asia, but interestingly enough, Africa is not on their radar screens. Read more…
The third draft of the Consumer Protection Bill (CPB) will be released for public comment soon. Up to now, franchisors appear to be blissfully unaware of the possible impact this piece of legislation could have on franchising. For example, it classifies franchisees as consumers, and allows consumers to cancel any service agreement by giving 20 working days notice!
This is one instance where ignorance is definitely not bliss. With this in mind, we have prepared a detailed paper setting out what's at stake. We urge you to study it carefully. Remember – the CPB is not law as yet and your input/comment could make a difference. Any feedback we receive will be passed on to Eugene Honey who spearheads negotiations with the dti on FASA's behalf. To read the document, click here…
A couple of weeks ago, Famous Brands, owners of Wimpy, Steers and other brands in South Africa, announced the acquisition of a 75% shareholding in Wimpy UK; the remaining 25% continue to be held by the Halifax / Bank of Scotland. As a result, Famous Brands, already South Africa 's largest franchisor of fast food operations, now also controls 194 Wimpy outlets spread over England , Scotland and Wales , plus a further 20 operating under a master licence arrangement in Ireland . Read more…
You may recall that during the early part of 2006, the alarm was raised regarding the deductibility for tax purposes of ongoing “royalty payments” made by franchisees to their franchisors. The debate arose because a Cape Town Tax Court had found that royalty payments made by a mining company to the owners of a mining property were of a capital nature and therefore not tax deductible. On the strength of this, some people jumped to the conclusion that the same would apply to franchise “royalties”. Read more…
The IFA Smart Brief, the International Franchise Association's newsletter, reports that the business of companies offering mystery shopping services is positively booming. The reason for this is that franchisor companies want to know what's really going on in their outlets before the press does. Read more…
A report in the UK-based Sunday Telegraph predicts that online sales during 2007 will rise by 40% from 2006. This translates to sales of £ 42 billion by the end of 2007, impressive by any standards. Although South African consumers, hampered by limited access to broadband, lag somewhat behind, the situation is changing rapidly. Read more…
Is your franchise network just not getting off the ground? Franchising Plus, in conjunction with financiers, is preparing to host a programme based on the Do-it-yourself franchising kit called Franchise By Numbers™.
The programme is aimed at new franchisors who cannot afford consulting fees, companies interested in franchising their businesses and existing franchisors who need to improve their franchise businesses. Given some of the questions in our Q and A section, it seems that there is a need for this programme. Read more…
United Businesswomen of South Africa, a member of Business Unity South Africa has been requested by North West University to arrange focus groups in various sectors of industry. One of these focus groups will be aimed at women in franchising. The goal of this study is to analyse current networking practices of Gauteng business owners and managers and to develop a framework for the successful utilisation and application of networks.
Women interested in participating in the study can contact with Colleen Larsen on colleen@ubsa.co.za . For any queries in this regard you may contact Colleen on 084-353-9865.
Q: My business is small but it has been operating for over three years now and is highly profitable. People approach me for a franchise all the time but this means that I have to enter into a franchise agreement. I have spoken to several lawyers about this but they all are just too expensive. Why don't you put a standard franchise agreement on your website? Read more…
Our experts are standing by 24/7/365 to answer any franchise-related questions. This free service is supported by some of the leading lights on the South African franchise scene including Eric Parker, Eugene Honey, Trudi van Niekerk, Anita Du Toit and Lynn Mendon ç a. Write to experts@whichfranchise.co.za and we promise to respond promptly.
To receive a copy of our media pack contact: dustin@whichfranchise.co.za
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