The fast food and quick service restaurant (QSR) sector continues to show steady growth on the back of what has been a tough economic climate in South Africa. With a contribution in access of 29%, QSR has by far the biggest share in franchising turnover. According to the Franchise Association of South Africa (FASA) , the franchising market is worth R587 billion Rand, which is approximately 13.3% of the South African Gross Domestic Product (GDP). Andre Beck, Sector Head: Fast Food and Restaurants at FNB Business says, “Industry data shows that South Africa has seen more franchises opening fast food and restaurant outlets in spite of the floundering economy. This clearly paints a picture of a sector that is competitive and lucrative, and more importantly, it shows that the franchising has sustained appetite to grow further in the local economy.” Beck shares key trends in this sector: Healthy food: Customers are mindful of what they consume more than before; they want to know ...

Franchises grapple to remain affordable and maintain profits in the wake of high input costs Soaring input costs and the electricity tariff hike coming into effect in April, coupled with increasing food prices and daily living expenses are making it difficult for fast food franchises to pass on costs to consumers who are already struggling to make ends meet. Morne Cronje, Head of Franchising at FNB says in response to the tough economic conditions, fast food franchises are becoming more strategic about maintaining profit margins while making sure that their offerings remain relevant and affordable to consumers. Franchise outlets have to take a number of market factors into account, such as lower disposable income, rising food inflation and interest rates, when deciding on the price of goods, to avoid driving customers into competitors’ hands. Consequently, franchises are having to absorb input costs in order to retain and continue to attract customers. Cronje clarifies that in some...

Fast food offerings must reflect the pulse of the economic climate Despite the tough economic climate, fast food remains a popular choice for South African families, but in order to attract and sustain a robust customer base, fast food franchisors need to ensure their menus reflect the financial environment and offer customers “more for their money”. Jan de Beer, Managing Executive of The Fish & Chip Co . says this popular fast food outlet has not only recently revisited its national menu to remain relevant to customers’ pockets, but also offers special promotions to attract more business.  With so many fast food choices, South Africans don’t have to go far to find a meal that everyone in the family would like to eat. The local fast food market is very competitive and each player needs to stay at the cutting edge of marketing to arrive at an approach that prompts people to spend their hard-earned money at their particular fast food restaurant.   Fish is the fourth...