New Zealand has one of the highest rates of franchise systems per capita globally, with around 450 systems and 23,600 franchise units. Since the 1990s people are better informed about franchising and a good range of new, mature, local and international franchises have been established in New Zealand. Thirty-eight percent of franchise systems operate in service industries, representing over 50% of franchise units. Food and beverage franchises also do well in the market. The median number of units per franchise system is 21.
Mobile service franchises have found great success in New Zealand. Some areas of the mobile services sector, such as lawn mowing and gardening services now experience a lot of competition, but still see growth as these services become more popular. The limited overheads in this type of business model are advantageous to franchisees in such a geographically spread country as New Zealand.
Good food franchises do well in New Zealand. Local tastes need to be considered and the trend towards healthy eating is a key factor to consider.
Leisure and education franchises have experienced growth, with more room still for leisure and fitness franchises. New Zealanders like to keep active, with convenience and price being important factors in their choice of activities.
Getting into the market
There is no specific legislation for franchises in New Zealand and they currently operate under the same commercial law as other businesses. The Health and Safety Act, Fair Trading Act, Employment Act and the Consumer Guarantees Act should be carefully considered.
The main growth strategies used by franchisors include offering exclusive territories, converting independents and encouraging multi-ownership for successful franchise operators.
Challenges noted by franchisors include the recruitment of franchisees, followed by the maintenance of standards and accessing franchisee capital.
Market intelligence is critical when doing business overseas and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS).
To commission research or for general advice about the market, get in touch with our specialists based overseas – or contact your local international trade team.
Barbara Harris, British Consulate-General Auckland. Tel: +64 (0) 9 303 5018 or email: email@example.com.
Deirdre Bonis, British Consulate-General Auckland. Tel: +64 (0) 9 303 5015 or email: firstname.lastname@example.org.
UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows.
None at present.