With the budget speech just days away and the election coming up in May, many South Africans are worried about the state of the economy. A recurring theme seems to be that of job creation and most economists agree that economic growth and job creation goes hand in hand.
The SMME (small, medium and micro-enterprise) sector of the economy plays a vital role in the creation of jobs. The National Development Plan predicts that by 2030 SMMEs will generate 90% of the 11 million new jobs aimed for.
By becoming a franchisee and a small business owner, you can be part of the solution for the South African economy. Franchising is an industry that continues to grow in South Africa despite the tough economic climate the country finds itself in.
According to 2017 FASA research, South Africa has 845 franchise systems which together contributed R587 billion or 13.3% to the country’s overall GDP. This is testament to the huge impact franchising has on the national economy.
Franchising’s biggest contribution to the economy is job creation. Franchises employ some 343000 people, 20000 of which are employed by franchisors while the rest are employed by franchisees. Furthermore, franchising businesses are more likely to succeed than start-ups. Two in three franchisors have been in business for more than ten years, and a further 17% for between six and ten years. This can be attributed to the fact that consumers trust franchise brands. Even through a recession, consumers still remain loyal to franchises. A franchise model allows peace of mind to the consumer of having a similar experience as they had at another location of that franchise.
You don’t have to start big to make a difference. If you’re looking to enter the economic sphere in a manner that yields satisfactory results without the huge risk, then franchising is your best bet. With a Soapbox franchise you can create jobs for two or three people and even more as your business grows. Measured against the staggering unemployment rate in South Africa, it may seem like a drop in the bucket, however it will make a huge difference in the lives of those two or three employees and their families.