UK Entrepreneurs Show Support for Franchising

The results of a latest survey have shown that UK entrepreneurs are increasingly opting for franchising when looking for new business opportunities.

In the last ten years the franchising industry has shown consistent growth and is now undoubtedly a significant part of the UK economy. In the last year the estimated economic contribution of franchises increased from £7 billion to £12.4 billion.

The year 2007 saw high levels of expansion in the industry. The number of franchise units increased by 8% up to 34,200 which is the highest ever total. Along with this expansion has been an increase in profitability with as many as 91% of franchisees reporting making a profit in 2007.

A spokesman for the survey stated that “Franchised businesses now contribute more than £1 billion to the economies of Scotland and six out of the UK's 11 other regions, with the West Midlands also poised to break the £1 billion level.”

“Existing systems are spreading into new regions and new systems are being generated in regions where franchising is under-represented – with the support in some places of the Government's Regional Development Agencies.”

"Overall, we can look forward to further growth for franchising in 2008, despite a hardening climate for the economy generally."

In a further boost, despite concerns about the current state of the UK economy, the overwhelming majority of franchisees and franchisors were optimistic about future business performance. Around 81% of franchisors anticipate that business will improve in the next year. For franchisees well over 50% stated that they are confident of improved performance in the next year.

One example of the expansion of the UK franchising industry has been food franchise wok2go. Created by chef and entrepreneur George Leung, wok2go is expected to open new branches of its restaurant franchise throughout the UK in the next 12 months.