Australia’s franchisee satisfaction increases in 2009

Written on the 15 November 2009

The Annual Franchisee Satisfaction Study by Franchising Research House 10 THOUSAND FEET has revealed that the franchising industry has held steady through a rough 2009, with growth in the number of satisfied franchisees. The survey of over 550 franchisees found an increase in willingness of franchisees to renew their agreements by half a percent from 2008.

The result shows franchisees have held up well in the economic downturn, with increased attention given by franchise companies to franchisee satisfaction. Yet according to Head of Intelligence at 10 THOUSAND FEET Ian Krawitz there is still plenty of work to be done to improve the experience of Australia’s Franchisees.

Krawitz said “The main areas franchise systems need to work on remains to be the support of their franchisees.” Krawitz identified the greatest gaps and opportunities to be in the areas of financial guidance and franchisees human resource skills. “Franchisors have historically taken a hands-off approach on financial guidance which has come into the spotlight in the current economic times. The better franchise systems are taking franchisee profitability very seriously and have got more hands on prescribing better financial record keeping systems and guiding their franchisees to manage their cash flows more effectively.”

Krawitz said the challenge of human resources has significant room for improvement, with franchisees lacking delegation and hiring and management skills “Franchisees are traditionally very good with their customers, but don’t necessarily have the human resources skills to hire and manage people effectively. The better franchise systems are coaching their franchisees on the value of holding on to their staff and what role they as a franchisee should take within in their business whether managing staff, servicing customers or operating behind the scenes.”

The satisfaction study fed in to 10 THOUSAND FEET’s topfranchise awards which saw Smartline Personal Mortgage Advisers take out the 2009 topfranchise award as the company with Australia’s most satisfied franchisees in 2009. Head of Intelligence at 10 THOUSAND FEET and topfranchise.com.au Ian Krawitz said “Key to Smartline’s achievement was their double win in placing number one in the critical categories of franchise support and number one in the financial and social rewards their franchisees receive.”

New entrants to the top10 were sign making company Signwave who have Australia’s most passionate franchisees and Australia’s largest bakery chain Bakers Delight who placed at number five and six respectively.

The most improved award in an area went to bedding company Snooze who saw a 58% increase in their franchisees willingness to recommend the business. The second most improved in an area went to computer games franchise GameTraders with a 32% increase in franchisees rating of their royalty fees being value for money. Moving into better economic times with the housing market picking up also helped ANZ Mobile Lending to a 29% increase in their franchisees belief that they will be able to sell their business for a good return on investment.

Other franchisors to improve significantly and make the top 10 improvers were Mortgage Choice who increased the frequency with which they contact their franchisees, while Care Care and Snap on Tools helped their franchisees to engage more with their customers, Mrs Fields improved the training opportunities available to their franchisees, Just Better Care improved their franchisees work life balance and Mr Rental improved in a number of areas to have their franchisees more willing to recommend their business.

The 10 THOUSAND FEET Franchisee Satisfaction Study was sponsored by Franchising Magazine, Gadens Lawyers, Fordham Wealth Advisers and Business Connect. More information on the topfranchise award winners can be found at topfranchise.com.au.