Business View Australia

Business View Australia - April 2015 23

Industry:

Story

over the last half century to achieve the position of

being one of the most important sectors of the econ-

omy. Starting off in the early 1970s with American

chains such as KFC, Pizza Hut and McDonald’s, the

franchise industry grew by leaps and bounds and

Australia today has the second largest number (just

behind New Zealand) of franchise outlets per capita

in the world.

The number of franchise systems grew from 693

in 1998 to 1160 in 2014, while the total number

of franchisees increased from 43,800 to 79,000

in the same period. The number includes 70,000

business format franchised units and an additional

9000 company owned units. Additionally, there are

6120 fuel retail units and 4598 motor vehicle retail

outlets. Given these figures it is not surprising that

the number of franchise outlets per capita in Austra-

lia is thrice that in the United States.

The sales turnover of business format franchising

units grew to $65 billion in 2014, up from $62 bil-

lion in 2011. In addition to this figure motor vehicle

sales were at $38 billion and fuel retail stood at

$41 billion, making for a franchising sector of $144

billion which accounts for almost 10% of the GDP

of the country. The franchising industry employed

461,000 people in 2014, 155,000 of whom were

permanent full-time employees, 125,000 perma-

nent part-time and 181,000 casual employees.

Success of franchising in Aus-

tralia

Chairman of the Franchise Council of Australia,

Warren Wilmot, has this to say regarding the suc-

cess of franchising in the country, “Geographical-

ly, Australia is the world’s sixth largest country so

solid business networks are required to service the

market effectively. Franchising makes an important

contribution not just in capital cities but in region-

al centres and rural Australia. Strong systems and