South Africa – the springboard to franchising in Africa

Franchising in Africa as a whole has a long way to go to becoming a primary business format but South Africa has enjoyed franchise success since the early 1960’s and leads the way in franchise development in Africa.

South Africa’s population of around 55 million people offers diverse opportunities for companies wishing to establish themselves in the country. Although the majority of the population fall into the lower end of the earning bracket, there is a growing middle class and, whilst luxury products cater to a more exclusive market segment, products and services appealing to the middle market are gaining popularity. There is room for growth for lower entry franchise opportunities especially in the services and recycling categories with social and tandem franchising a welcome solution to some of the country’s service delivery challenges.

Africa – the New Frontier

Often seen as the ‘poor cousin’ to the rest of the world, the numbers paint a different picture for the rest of Africa. According to the African Development Bank, GDP growth for the African continent is forecast to accelerate to 4% in 2019, up from an estimated 3.5% in 2018, making it the fastest-growing region in the world after Asia. And that’s despite Nigeria and South Africa, which make up almost half of the continent’s GDP, pulling down Africa’s average growth. While the powerhouses in western and southern Africa struggle to show meaningful growth, the continent’s economic growth will be driven by East Africa, which will be the fastest-expanding region for the 5th straight year.
As franchising becomes saturated in developed countries, emerging markets like the Far East, China, India, South America, Eastern Europe and Africa become fertile grounds for franchising to take root. With Africa’s long-term growth and the help of technology, urbanization and an expanding labour force will see the rise of the middle-class African consumer. According to McKinsey’s research, in 1980, just 28% of Africans lived in cities. Today, 40% of the continent’s one billion people do – a proportion roughly comparable to China’s and larger than India’s; by 2030, that share is projected to rise to 50%, and Africa’s top 18 cities will have a combined spending power of $1.3 trillion.
FASA has spent many years making sure that the international franchise community is cognisant of the potential that lies within South Africa. As the future frontier of franchising, Africa and in particular South Africa needs to stand up and be counted. It is a recognised fact that South Africa is the springboard for potentially explosive growth into Africa and the stark reality is that the broader African economies cannot grow in isolation as the continent’s future is inextricably linked to South Africa and the example it sets. Through the establishment of the Pan African Franchise Federation, FASA plays a guiding role in advising other African countries on the benefits of franchising and has advised countries wanting to establish associations.

Economists agree that if government is to achieve its target of 5 million jobs by 2020 it means that 495 000 new businesses have to be created to provide those 5 million jobs. Franchising has proved that it can fulfill all the criteria for small business expansion and FASA has already initiated a transformation Master Plan project that will encourage entrepreneurship within the emerging sector.

Franchising will continue to play an important role in the economic through its tried and tested business format and FASA, through its commitment to promote franchising in line with government’s mandate to encourage small business development, will continue to safeguard the environment for franchising to flourish.

Signarama SA celebrate their 20th Anniversary with the sponsorship of a Guide Dog Puppy!

signarama

Say hello to Enji

“Who or what is Enji?” you might ask, Enji is a very large and important part of the Corporate Social Investment made by the Signarama Group as we head into 2020 celebrating our 20th Anniversary in Southern Africa. As part of these celebrations, Signarama franchisees elected to donate a portion of our annual CSI budget to the SA Guide Dogs Association. Each year, the Signarama Group elects a suitable beneficiary for our CSI investment for that year and we are proud to say that our initiatives have created a lasting impact on the communities that we serve. Our most recent investment combined the sponsorship of the Association’s annual Golf Day in Cape Town, plus the sponsorship of a Guide Dog from their center in Johannesburg.

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Attracting new customers in 3 simple steps

happy clients

When opening a business, it is important to identify factors that make your enterprise unique. These factors can be used to market your business and attract clientele. When opening a Signarama franchise, you have a specific service to offer clients – signage and branding solutions – and you should build your marketing efforts around this.

Investing in a Signarama franchise instead of opening your own signage or printing business permits you to benefit from the brand’s established reputation from the start. A company’s brand and reputation influence potential clients’ purchasing decisions. If a prominent food critic, for example, eats a meal at a restaurant and delivers a bad review, it will indirectly change your opinion of the specific restaurant – sometimes without you even realizing it!

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Joyous celebration of Oasis Water’s 300th Outlet 

Lynnwood Oasis store

The Van den Berg family and their stellar team come together with Oasis Water head office to commemorate this landmark occasion.

Equestria, Pretoria: On Friday, 1 November 2019, the family team of mom Charmaine van den Berg with sons Riaan(26), Deon(23) and Dewald(19) were excited to celebrate their 9th Oasis water outlet with their entire staff team. Their 9th outlet also marked the wildly successful Oasis Water franchise’s 300th outlet in South Africa! “This was a team effort, and we celebrate together,” said director Riaan van den Berg. Festivities took place at their latest Oasis Water shop in the brand new Lynnwood Lane shopping centre conveniently situated on Lynnwood road, just next to the Grove mall.

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Small businesses to be given priority in shopping malls

Small business

As retailers and malls around the world have come under pressure due to the growth of online shopping (at an annual rate of 25% in recent years) and with changing consumer shopping habits reshaping the retail world, shopping malls are having to re-invent themselves not only in their appeal to shoppers but in their dealings with their tenants.

At the recent Annual Congress of the South African Council of Shopping Centres (SACSC), speakers focused on the new relationship between tenant and landlord and the need for greater flexibility when it comes to supporting and assisting struggling tenants.

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A new franchising industry code for South Africa

new franchising code

As you may recall, the Consumer Protection Act, no. 68 of 2008 (“CPA”), introduced franchise legislation into the franchise industry in South Africa, on or about 1 April 2011. By way of example, Regulation 2 thereof sets out 50 or more points that need to be dealt with and included in a compliant franchise agreement. Regulation 3 introduced the provision of a disclosure document, to be furnished to a prospective franchisee, at least 14 days prior to signing a franchise agreement. This sets out what information and documentation should be provided to the prospective franchisee, to place the franchisee in a position where they are reasonably able to assess the franchise business opportunity offered by the franchisor.

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Pertunia Sibanyoni, finalist for the Positive Role Model Award

Pertunia Sibanyoni

Congratulations to InspectaCar’s Pertunia Sibanyoni, finalist for the Positive Role Model Award, C-Suite, at Gender Mainstreaming Awards 2019.

FASA member Pertunia Sibanyoni, CEO of InspectaCar, was the 4th placed finalist in the Positive Role Model, C-Suite category, in the Gender Mainstreaming Awards 2019. Pertunia is passionate about mentorship, empowerment and women leadership. She is a trailblazer, a change maker and a force to be reckoned with.

The Gender Mainstreaming Awards, now in its 7th year, acknowledges those companies and individuals who have actively worked towards gender diversity at executive and board levels. These companies have successfully transformed their boards while ensuring that aspiring female directors are judged on their corporate governance skills and experience, and not their gender.

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In FASA’S 40th anniversary year, it celebrates the 1990’s – when franchising came of age

Local entrepreneurs

The 1990’s, with its transition to a new democratic dispensation, was interesting in that after years of sanctions and being cut off from the outside world, experts expected an influx of international franchises. While that tsunami never happened – besides McDonalds’s that injected another level of professionalism – the few that did, according to franchise consultant Eric Parker, ‘wanted to participate, but without paying their school fees and suffered the consequences as they could not stay the course and left broken dreams in their wake.’

Local entrepreneurs, spurred on by the wave of optimism sweeping the country, allocated cash and other resources to the development of home-grown franchise concepts from scratch. The nineties saw franchising come of age, both in quantity and quality in sectors as diverse as health and beauty, business to business, home services and education.

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A focus on the 1980’s – The decade of home-grown franchise concepts

struggling economy

As part of FASA’s 40th anniversary year, we take a look at the 1980’s – the decade of the home-grown franchise. With economic sanctions biting hard, several foreign concepts and brands withdrew from the country and caused the virtual drying up of new arrivals. Enforced isolation from foreign concepts did not stop South Africa’s entrepreneurs from picking up international franchise trends or developing home grown franchises which they did with great enthusiasm. Despite economic growth slowing in the early 1980’s and the country hit by a series of droughts coupled with political unrest and isolation, consumers in South Africa embraced the franchise culture. The restaurant and fast food franchises starting expanding offering a variety of menu choices and brands in retailing were ever-growing.

Motorists were spoilt for choice on where to get their cars serviced, new education franchises were offering extra-tutoring services and business-to-business services were on the increase.

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KFC in Atlanta sells out of plant-based chicken in Atlanta

KFC Atlanta

The sight of long queues of people snaking around the corner at a KFC outlet in Atlanta, USA as they wait to order KFC’s plant-based chicken was beamed around the world. But something looked distinctly different…. instead of the bright red so synonymous with KFC, there was a distinctly ‘plant green’ look with the outlet and the packaging in green.

According to a report in the New York Times, KFC’s plant-based version of its classic fried chicken sold out ‘within hours’ after being tested at one of its chains in Atlanta, Georgia. KFC announced that once it had tested its Beyond Fried Chicken at a single location, the consumer feedback it would gather would determine if it was an option to roll out the plant-based chicken alternative in more locations.

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