Key franchising facts
See also the Natwest bfa Franchise Survey
The term 'franchising' has been used to describe many different forms of business relationships, including licensing, distributor agreements and agency arrangements. In its most familiar sense, the term ‘franchise’ has arisen from the development of what is called 'business format franchising’.
Business format franchising is the granting of a license by one person (the franchisor) to another (the franchisee), which entitles the franchisee to trade as their own businesses under the brand of the franchisor, following a proven business model. The franchisee also receives a package, comprising all the elements necessary to establish a previously untrained person in the business and to run it with continual assistance on a predetermined basis (including a predetermined agreement length, with renewal options).
The following statistics are from the NatWest/bfa Franchise Survey 2012:
Franchise industry statistics
Industry annual turnover: £13.4 billion
Number of franchisor brands operating in the UK: 929
Number of franchisee outlets: 40,100
Number of people employed in franchising: 594,000
Percentage of units profitable (including new businesses): 91%
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.
Should you require further detail of past statistics, the bfa is able to provide a free press copy of the latest NatWest bfa Franchise Survey for use by academics.