Published by British Franchise Association:
Modern franchising is home to a vast array of business sectors, both B2B and B2C, blue collar and white collar, from home-based operations to some of the world’s most recognised brands. The chances are that most people use the services of a franchise business each week etiher personally or professionally, even if they don’t realise it at the time.
The British Franchise Association’s list of accredited members demonstrates the scope of business types in franchising.
In 2015 franchising set a number of new records as its performance continues a remarkable rise over the last decade. New benchmarks in turnover, profitability, numbers of franchisee-owned businesses and jobs created by the sector highlight the important and growing contribution of franchising to the UK’s economy.
The following statistics, from the bfa/NatWest Franchise Survey 2015, show the health of UK franchising:
Franchise industry statistics
Industry annual turnover: £15.1bn
Number of franchisor brands operating in the UK: 901
Number of franchisee outlets: 44,200
Number of people employed in franchising: 621,000
Percentage of units profitable (including new businesses): 97%
This has grown from an industry that 20 years ago had a turnover of just over £5 billion, had 379 different brands and represented 18,300 franchisee outlets.
Franchise Industry Research:
bfa/NatWest Franchise Survey
Beginning research on the franchising industry in 1994, the British Franchise Association (bfa), with the outstanding support of NatWest, has been building the most detailed long term franchise survey in the world. The full annual report can be purchased through the bfa’s online bookshop.
The following gives an overview from the last published report (January 2016) to give an overview of the UK franchise industry.
Overall, the picture is of an industry sector in rude health which continues to prosper:
The contribution of franchising to the UK economy is now reckoned to be £15.1 billion, an increase of 46% over the past 10 years and up 10% since the last survey in 2013.
The total number of people employed in franchising in the UK is 621,000, of which 321,000 are in full-time employment.
- This equates to an increase of 70% over the past 10 years
The number of franchisee-owned businesses has increased by 14% in two years, to 44,200.On average, those businesses are also becoming larger as the sector matures:
- Average turnover continues to rise and over half now claim an annual turnover of more than £250,000
- Employment per unit continues its upwards trajectory, with one-third now employing 10 or more staff
A record 97% of franchisee-owned units reported profitability, with 56% saying they are ‘quite’ or ‘very’ profitable.
- Ownership changes in franchisee businesses are correspondingly low (4.6%), with failure rates much lower than for other SMEs generally
Franchisees’ satisfaction with their franchisor has never been higher, with 91% saying they are ‘mainly’ or ‘definitely’ satisfied.
Some 29% of franchisees now run multiple units.
80% of franchise brands in this country are UK-owned and developed.
One in five franchisees who launched their business in the last two years was under 30 years old when they did so.
The total economic contribution of the franchise industry now stands at a record £15.1 billion, up 10 percent in the last two years.
Employment in Franchising
The number of jobs continues its strong growth, up 11 percent on 2013 levels.
Franchisee Business Numbers
Growth of 10 percent in the number of businesses run by franchisees since 2013 sees the sector reach new heights in this regard by some distance.