The phenomenal success of franchising
by
Norton Rose
In Australia, the franchise sector has enjoyed exponential growth over the past 15 years. It now boasts an annual turnover of over $80 billion, and employs over 650,000 people. There are around 750 different franchise systems, over 90 percent of which are home grown Australian systems, and around 50,000 franchised outlets. The sector generates over $290 million in annual export income for Australia.
Franchising was originally used primarily as a distribution method for manufacturers and suppliers. It was used extensively by motor vehicle manufacturers, soft drink companies and oil companies, and remains the dominant business method in these industries. However, these days people are more likely to associate fast food, specialty retail or home services businesses with franchising.
In fact, franchising techniques are now used in most industries where goods or services are sold to consumers via a network. Whilst it has often been acknowledged that franchising enables small business to compete effectively with large chains, it is now clear that franchising can also deleiver competitive advantage to large corporations seeking more effective and efficient distribution.
The list of well known companies that use franchising techiniques in their business includes fast food retailers McDonalds, KFC and Red Rooster; bulky goods retailers Freedon Furniture, Harvey Norman and Forty Winks; financial institutions Bendigo Bank, Mortgage Choice and Retireinvest; automotive industry leaders Midas, Autobarn and Bob Jane T Marts; leading bakers Bakers Delight and Brumbys; printing and signage companies Kwik Kopy, Snap printing and Sign*A*Rama; health industry operators Terry White Chemists and OPSM; utilities such as AGL and Energex; service businesses such as VIP, Jim’s Mowing and Fastway Couriers; and almost all major real estate firms and car rental companies.
See the buying a franchise and running a franchise pages for further assistance.
This article was created by Deacons and appears courtesy of Austrade . 26.06.2007
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