Showing posts from September, 2015

Franchising agreement - Licensing agreement Is there a difference?

Franchising has become a popular business model across the world and over the years, South Africa has produced home-grown franchises such as Steers, Wimpy Sorbet, to name but a few  - which have become household names. 

Equally, there are a number of license-based agreements which offer businesses an opportunity to offer specific products or services to their market. 

Morne Cronje, Head of Franchising at FNB Business says, “It is essential to understand the difference between a franchising agreement and a licensing agreement, especially when seeking funding from a financial services provider. Each business model is governed by a completely different agreement or contract and they operate in a unique way.”

Cronje says some of the key distinguishing factors are as follows:


Franchising can be best described as a duplication of a specific business model, which is governed or controlled by means of a Franchise agreement. The Franchisor holds all rights, including the business model.…

Access to funding and lack of skills remain critical challenges facing SME’s

While there is general agreement that SMEs are a key driver of employment and job creation in South Africa, and play a vital role in achieving the National Development Plan’s Vision 2030, Kenneth Fisher CEO: Business Finance SME at the Real People Group says SMEs continue to face numerous challenges making it difficult for this sector to prosper.

“Access to credit remains a major obstacle for SMEs, particularly in the current economic climate where credit providers have tightened their belts when it comes to granting loans.” 

“Only 25% out of 84, 4% of loan applicants are successful and out of the 25% of successful applications, 85% of applicants that have accepted the loan, only 18% go on to actually get the loan (NCR, 2011),” says Fisher.

In addition to accessing finance, Fisher says adequate training and lack of skills is another area where SMEs fall short. 

“It is commonly known that eighty percent of SMEs fail within the first two years, which in many instances comes down to entrepre…

Gold, history, architecture and culture – Gauteng

The name Gauteng is derived from the Afrikaans word “goud” (gold) plus the Sotho-Tswana locative suffix "-ng". This referred to the growing gold industry in the province following the 1886 discovery of gold in Johannesburg. In Sesotho the name was used for Johannesburg and surroundings long before it was adopted in 1994 as the official name of a province. Gauteng is essentially the powerhouse of South Africa, producing 33% of the GDP. Approximately 9,5m people reside in the province and the main languages are English, Afrikaans, Zulu and Sesotho. Over 40% of the world’s gold reserves are located along the Witwatersrand within the province and millions have flocked to the streets of Johannesburg – the ‘City of Gold’ - since the precious metal was discovered here in 1886. 

While still a key element of the province’s income, gold is however no longer the fulcrum on which the local economy is hinged. Gauteng has long since diversified and is now also the hub of the country’s fina…

FNB Franchising Summit 2015 Owning and operating multiple franchise units

Franchisees who make a success of their current franchise often consider  owning a second or multiple franchise units. Franchisors might also grant a second or multiple units to existing franchisees as they have proven that they can make a success of their franchise.

“A multi-unit franchisee is defined as the franchisor awarding the right to a franchisee to operate more than one unit within a defined territory. To manage and run multiple franchise units requires ongoing dedication and commitment,” says Morne Cronje, Head of FNB Franchise. There are a few factors to consider before embarking multiple franchise units.

A multi-unit franchise owner will have higher expenses not just due to the normal additional operating expenses, but also due to the need for a good infrastructure. Owners will need to ensure that the units are consistent throughout and will have a higher capital requirement as revamps to the outlets will be required.

2.Sound Financial Management
The franchise owner …

Innovation and Franchising

Innovation is an important part of owning a franchise. “One way to set yourself apart from the pack and to always stay ahead is to innovate. If you stagnate, your business will fall behind and will most probably not be a success,” says Morne Cronje, Head of FNB Franchise. There are a number of ways to innovate. 

Be different
The heart of innovation is to be different. So always look for ways to be different and  for ways to stay current. 

Introduce new technology
Something that will set your business apart from others is to incorporate technology to make you business more proficient. If you have a frozen yoghurt store, maybe you’ll have machines that work faster and better, or it could be that you’re using the latest payroll or admin technology to make your business more efficient.

Marketing is an excellent space in which you could innovate. Do something different to your competitors, like incorporating social media into your marketing strategy. Social media has become a vital com…

Why having a vivid imagination is good – and how you can develop your child’s creative thinking

Many of us can probably admit to using the well-worn excuse, “I’m just not the creative type” to get out of the school craft project or avoid that community cake sale. Yet, we are all naturally creative beings, practising our creative skills on a daily basis – from navigating a route around the traffic to whipping up dinner with what’s left in the fridge or even, simply, deciding what to wear each morning.

What is creativity and why do we need it?

“Much of creativity does not necessarily have to do with the arts. Activities in our everyday lives provide us with numerous opportunities for problem solving, lateral thinking and widening our thought patterns,” comments Liz Senior, Occupational Therapist and Founder of Clamber Club. “While creativity is a skill that should be nurtured from a very young age, it is something that we continue to develop throughout our lives,” she adds.

Creative activities provide a number of benefits by:

Enhancing the ability to visualise,Providing problem-solvin…

What exactly does it take to become an agent?

Are you an entrepreneur looking to embark on a new challenge? Do you want to manage your own time? How about writing your own pay check every month, with as many zero's on it as you like?

Take the next step and become a real estate specialist. Here are some tips on where to start:

Real estate selling and buying means that a lot of legal aspects and transfer laws have to be taken into account. Paper work and professionalism is top of list for any rookie wanting to take on the property industry as a career opportunity. To make sure you start by building a proper foundation to your new career one should consider joining a real estate academy. To be a fully qualified agent, you need to have your NQF4 qualification from the EAAB: this qualification is to the equivalent of a BA Degree. In order to obtain this status, there are a few steps which you will have to take – but it will be worth all of the hard work. 

To start this process, you need to join a reputable real estate agency, and the…

A multi franchising success story

Alan Smith might not have been able to foresee it, but when he acquired his first Cash Converters store in Boksburg, he was laying the foundation of what would become a small empire.

Alan was first introduced to the network by a friend. Although his previous work experience had been in food – he had owned a bakery – he says that he has always been a trader at heart. “Even when I was at school, I used to love buying and selling things, from eggs to Scooby doo wire,” he says. It’s the potential to earn money that gets him excited. “This is the only business that I know of where you are able to dictate your own costs. Plus, you never know what you’re going to buy next in your store.”

He therefore agreed with his father’s suggestion that he purchase a store. Head office had recommended a site on the East Rand, and so it was that Alan opened his first shop in the East Rand Value Mall in 1999. Although it was a new site, Alan said that building it up was relatively easy. With his passion for …

The Captain’s Back!

It’s been 43 years since Joe Dorego first wowed the Mother City with his signature brand of Captain DoRegos fresh fish and chips… and now the Captain is back!

From its humble beginnings the original restaurant became a group that forged a highly successful path across the rest of the country and expanded on their original promise of serving the finest South African fish and chips to by developing a magnificently varied menu that reflects the broad cultures and tastes of all the people of South Africa. There are currently 60 outlets countrywide, reinforcing the brand’s national appeal.

Classics such as fresh fish, crispy fried chicken and russians and chips, all the way to favourites like chuck and pap, dagwoods, burgers, ribs, breakfasts and shawarmas — Captain DoRegos prides itself on great variety, quality and price.

Returning to the southern suburbs, in the melting pot of Wynberg amidst the train station, taxi rank, student accommodations and Maynard Mall, Captain DoRegos is excited t…

Eau de Vie - Saving the environment one litre at a time

South Africa is a beautiful country with abundant natural resources, but, worryingly, recent studies indicate that by 2030 and assuming similar water consumption patterns, there will be a 17 percent gap between water supply and water demand. It’s wise to assume that water is one of the most precious commodities in our country and the SME business sector can make a significant difference in the preservation of water. Let’s just take the restaurant trade for example.

As a restaurant owner, you have a few options for supplying patrons with drinkable water; either from the tap or pre-bottled. A recent alternative option is to filter and bottle your own water directly on-site. To safeguard your empire and satisfy savvy consumers, tap water is most probably not advisable, which leaves the option of purchasing bottled water or a filtration system.

Eau de Vie’s water filtration systems produce fresh filtered, still or sparkling drinking water on-demand directly from any local mains supply, with…

WeThinkCode_ announces official launch and founding sponsorships with FNB, BBD and Derivco

WeThinkCode_, a new peer-to-peer tech institution dedicated to eliminating the IT skills gap, is announcing its official launch in South Africa and three-year founding sponsorships with First National Bank (FNB), BBD and Derivco.

WeThinkCode_ identifies and trains brilliant young minds to become world-class programmers in a peer-to-peer problem solving learning environment. In partnership with Ecole 42 in France (, WeThinkCode_ will open its first campus in January 2016 in Johannesburg. Tuition-free, the organisation partners with companies to sponsor the two-year course and ensure a sustainable business model.

As Founding Sponsors; FNB, BBD and Derivco will provide financial support for the launch of the programme and will play a role in ensuring the curriculum stays relevant to the industry. Students will also be able to interact with sponsors through internship opportunities and projects throughout their coursework.

The three founding sponsorships add to a number of South…

Get the best from equipment finance for your franchise

Anyone who owns and operates a franchise will tell you that cash flow determines whether your business succeeds or not. However, unexpected expenses can occur and many will be linked to the need to urgently buy or replace equipment. Therefore, the potential for a negative impact on cash flow always exists.

When expensive equipment is needed urgently, the solution to obtaining the equipment also means preserving cash flow as far as possible, says Toni Fritz, Head of Vehicle and Asset Finance - Business at Standard Bank.  

“When times are tough, paying out hard-earned cash for operational necessities is often not an option. Financing is then, the only realistic solution. However, how you raise the money and what the final cost will be to you, should be carefully considered before you commit yourself to a loan.”

Things to consider when seeking finance:

•The monthly repayments

Research your options and do some calculations. You could find that, by paying a little more every month you could red…

SA SMEs struggle with cash flow as a result of delayed payment

Irregular or delayed flows of payments from customers continue to have a detrimental impact on the cash flow of South African small and medium enterprises (SMEs), severely restricting opportunities for expansion and job creation.  This is according to Gerrie van Biljon, Executive Director at Business Partners Limited (BUSINESS/PARTNERS) - a risk finance company which finances and invests in SMEs.

Van Biljon says that the way in which a business manages its working capital and the speed of its cash conversion cycle ultimately impact its overall profitability. “Put simply, in order to produce and sell a product or service a business incurs costs including wages and raw materials, and if it doesn’t receive payment during a certain time period for the product it has manufactured, or the service it has provided, the business cannot purchase new material, pay staff or overheads.

The most recent Business Partners Limited SME Index, which quarterly measures confidence levels amongst local busin…

Goodyear South Africa to invest ZAR670 million to increase High-Value-Added production at Uitenhage Tyre Factory

Goodyear South Africa today announced it will invest ZAR670 million to increase production of high-value-added (HVA) consumer tyres at its Uitenhage manufacturing plant to drive profitable growth and meet market demands.

The investment plan would see the introduction of state-of-the-art manufacturing technology for the plant and will enable Goodyear to meet the strong and growing market demand for HVA consumer tyres in South Africa and Sub-Sahara Africa. The tyre market in South Africa and Sub-Sahara Africa is expected to experience double-digit growth through 2020 led by the consumer segment.

“This is an important investment by Goodyear and is consistent with our strategy to serve the needs of our customers and the company’s focus to invest in high return projects that drive profitable growth,” said Jean-Jacques Wiroth, managing director of Goodyear South Africa.

The new technology and accompanying comprehensive employee training will further improve the plant’s capability and capacity …

Cash Converters launches new e-learning training platform

Cash Converters Southern Africa has recently launched a comprehensive e-learning and video training tool available to all franchisees and their employees. The programme is set to become an indispensable tool for career planning and employee development for all levels of employees within the franchise.

“Training is an essential part of any franchise model,” says Bev Slabbert, Training and Development Manager at Cash Converters. “With Cash Converters being an international brand, our new e-learning model ensures consistency with international standards and gives employees from all over the region easier access to training ensuring that we’re consistently delivering the same message that conveys our values and approach to customer service. Using this cutting edge technology we’re able to overcome gaps like education, culture, distance and language.”

Each curriculum consists of a growing number of interactive e-learning content and video clips as well as video episodes of a TV show called C…

The accidental entrepreneur

Why is it that with so much information at our fingertips, the failure rate of businesses in South Africa, and new businesses in particular, remains unacceptably high?

By Derek Fox

In his book The E Myth Revisited Michael Gerber brings a sobering reality to the debate on the unacceptably high rate of business failures. Gerber’s view is that business by its very nature is complex; he theorises that we all have three personalities — the entrepreneur, the manager and the technician. The skills of the technician and the manager are what we use in our daily lives as employees to earn our livings as sales people, administrative employees, managers, etc. When we decide to go into business for ourselves, we set aside the mindset of the technician and the manager and think instead from the perspective of the entrepreneur. It is also then that we lose focus and neglect to consider all the requirements and components needed to make a business successful.

At the heart of the challenge is what you ar…