Own Boss, he says that with regard to job creation, for example, almost 500 000 new businesses will have to be created if the government is to meet its target of 5-million new jobs by 2020. “While formal sector employment fell alarmingly in the two years from 2008 to 2010, the franchise sector, which represents 17 different industries, created 2 300 new business outlets and more than 28 000 new jobs. Indeed, franchising can go a long way in stimulating entrepreneurship and helping people to establish the successful small businesses that are the backbone of the economy and job creation.” Once a franchise system has been tried and tested, one can take decisions based on realistic financial projections — and subsequently mitigate risk far better.
However, he does not believe that the biggest challenge facing franchising is the current economic climate and banks’ conservative lending policies. “The biggest challenge is to get the message across about the very important role franchising can and does play in the economy, and to expand the concept to other industries.”