Morne Cronje 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 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 h...

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 instanc...

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 ...

Morne Cronje 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. 1. Expenses 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 Fina...

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 Marketing is an excellent space in which you could innovate. Do something different to your competitors, like incorporating social media into your marketing strategy. Soci...