Nedbank and FASA connect with members at Franchise Breakfast
As a bank that recognises the value and importance of the franchising sector for South Africa’s economic future, Nedbank is committed to supporting franchisees and franchisors, and to that end hosted FASA and its members at a breakfast that focused on the economy and what the future holds.
Welcoming attendees, Alan Shannon, Executive: Small Business Services & Private Clients, recognised the value and importance of the franchising sector for South Africa’s economic future and reaffirmed Nedbank’s franchising commitment to supporting franchisors and franchisees.
Speaking a day after Minister Enoch Godongwana gave his Medium-Term Budget Policy, Nicky Weimar, Nedbank Group’s Chief Economist was able to give clarity on where government is heading with economic and political reform whilst also giving a broader global economic overview.
The west sneezes and emerging markets catch a cold
Since 2020, the world has been in turmoil affected by the Covid-19 pandemic which set off ripple effects that continue to hurt supply, disrupted production and caused global economic strain. The Russian/Ukraine war added to the toxic situation where already high inflation sky-rocketed, impacted by a surge in oil, natural gas, fertilizer & wheat prices which started to adversely affect the poorer economies like Africa.
Although the war is still raging causing fracturing of the world economy, emerging markets have to choose between supporting the USA, EU or Russia, China and the Middle East. There have been signs of oil prices and food prices coming down, with grain corridors opening up for exports especially to Africa. However, inflation is peaking in the US and the EU and to bring inflation down, countries are having to increase interest rates, slow down demand which could trigger recession, and force higher unemployment.
South Africa, like all emerging markets, has also taken a beating with slower growth, less demand for commodities and a risk of recession. Add to that load-shedding which is making things worse, resulting in retail sales taking strain, floods and political turmoil and the picture is not rosy. However, the silver lining lies in the fact that we are not facing a consumer recession but rather a slow down with growth more or less back to pre-pandemic levels.
Nedbank mindful of the challenges facing franchising
Nedbank’s advice to businesses is to make an effort to eke out efficiencies by improving productivity, cut costs, diversify markets and find new income sources and in the franchising context, to create a win-win scenario by supporting franchisees through trying times.
By partnering with reputable franchisors founded on strong operating models, principals, values, and integrity, Nedbank is able to offer highly competitive pricing structured to the needs and individual risk profile and track record of each specific franchise business – providing an integrated solution that incorporates lending- transactional- and value-added offerings. According to Coenie Smith, Head of Franchise: Small Business Division, “with Nedbank, you get a partner that is strategically aligned to your growth narrative – one that understands that you need more than just products and that can help your business reach the next level. We will immerse ourselves in your franchise and sector so we can become an extension of your team, with a full understanding of your financial needs and business aspirations.”
FASA’s Chair, Pertunia Sibanyoni and Fred Makgato, CEO, both outlined FASA’s strategic direction going forward that hopes to play a role in facilitating business entrepreneurship and transformation by lobbying government to play a greater role in recognizing franchising as a way to grow the economy. Issues such as load shedding, lifting red tape, encouraging aspirant entrepreneurs especially in the township economy, attracting more investment into the franchising space, are all initiatives that need to be addressed in order to create an enabling investment environment.
To protect, lobby, promote and develop ethical franchising across all sectors in South Africa with specific focus on transformation.
