The ability to self motivate (68%) and experience of sales and marketing (24%) are the most important characteristics that franchisors seek in potential franchisees, according to the 2004 NatWest/British Franchise Association survey.
Work and life experience is very important to franchisors when recruiting new franchisees. Nearly two thirds of franchisees were in salaried employment immediately before taking out their current franchise, 29% were self-employed outside franchising and just 2% were self-employed with another franchise. Of the new recruits coming into franchising for the first time, only 12% had previously been unemployed or made redundant.
Whatís more, almost all franchisors are no longer specifying a particular gender (93%) or age range (91%) when looking for suitable candidates to run a franchise. Nevertheless, the survey also shows that only 28% of franchisees are under the age of 40, compared with over 50% back in 1992 and that just less than a third of new franchisees report to be women.
As for making their final franchise selection, 20% of franchisees opt for a well-known brand; 18% have an interest in the particular field of activity; 16% look at affordability; 7% opt for a BFA member; 7% look at the success of existing franchises; 3% consider growth potential and 3% simply liked the representative that they met from the franchise.
Before getting involved in franchising, new franchisees carried out a huge amount of research, from newspapers (25%), magazines (19%) and exhibitions (10%). Nearly a quarter also referred to general franchise websites for information. There has also been a 13% increase in the proportion of people seeking advice from their bank, to 81% from 68%.
Mark Scott, National Franchise Manager at NatWest, said: ìThe fact that 95% of franchisors are profitable shows the immense contribution that the sector makes to the UK economy. New franchisees are clearly doing their research and asking the right questions when deciding whether to choose franchising. If a franchisee has the right levels of self motivation and drive, franchising can be one of the safest and most sustainable routes to running your own business.î
Sir Bernard Ingham, President of the BFA, said: ìOne major fact to come from the 20th Annual BFA/NatWest survey is, despite the tough economic climate, 95% of franchisees are profitable. This figure has risen from 91% since the 2003 survey and shows how important franchising is as a business sector in the UK.
ìAs a major employer, with an estimated 330,000 people earning their living in the sector, franchisors and franchisees alike are very optimistic about the future of their businesses. In the next 12 months, 90% of franchisors and 69% of franchisees expect their businesses to improve. These figures show franchising is growing as an industry ñ a fact backed up by an increase of almost 2% in turnover to a record high 9.65 billion.î
Motivation and experience are top characteristics for franchisees
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