South Africa Springboard to franchising in Africa

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The Franchise Association in South Africa (FASA), a long-standing member of the World Franchise Council and the oldest and most established Franchise Association on the African continent, has spearheaded growth into the rest of Africa with the establishment of the Pan African Franchise Federation.

The inaugural meeting, held in 2013, was attended by delegations from Egypt, Ethiopia, Mauritius, Tanzania and Nigeria and is held each year alongside the International Franchise & Entrepreneurs Expo (IFE 2013) held in Johannesburg, South Africa. According to Vera Valasis, Executive Director of FASA, the time is right to bring African countries together to explore the opportunities that franchising can bring to growing African economies. “Whilst we in South Africa have had a thriving first-world franchise sector since the 1960’s, with over 80% of our franchise concepts home-grown and have also ventured into Africa with many of our food and retail brands, Africa as a whole has lagged behind in franchise development.

Where first world countries are experiencing minimal growth, Africa is at the beginning of an enormous growth curve. “Africa’s hidden strength is its growing middle class. In 2008 the continent’s combined GDP was R11.2 trillion which was larger than that of India and on a par with that of Brazil and Russia combined. It is estimated that consumer spending on the continent will, in the next few years, be R9.8 trillion.” Growth, according to experts, lies in the private sector which will be the driver of growth in Africa. “Africa needs new enterprises that create jobs and wealth and it is the small and medium enterprise sector that carries the hope for the continent and the route Africa must pursue.”

“With some of the world’s top franchise brands such as Burger King, Domino’s Pizza and Pizza Hut entering the South Africa market, it is now time that FASA and the Pan-African Franchise Federation play a bigger role in promoting franchising and expanding this unique business format to not just select countries, but to the continent as a whole.”

As a result, interest is growing from African countries including Ghana, Mauritius, Tanzania, Kenya, Zimbabwe, Zambia, Angola, Nigeria and Uganda which are all keen to engage with both local and international franchise companies with a view to growing their franchise sectors. “It is a well known fact that some international franchise brands establish a footprint in the South African market first and then expand into other African countries” says Vera Valasis.  “The association is in the process of establishing a networking platform for local franchisors to meet and network with business representatives from these and other African countries at its forthcoming International Franchise Expo.