Why Africa is the next Franchising Frontier

Africa is rising fast. With some countries achieving annual economic growth of 8%, Africa is beckoning businesses from far and wide. But Africa is a continent of stark contrasts – for all its opportunities and promises of wealth, it is equally a market posing risk and challenges, so it’s important to know what you’re letting yourself in for if you’ve got your eyes on the African horizon.

Why Africa is the next Franchising Frontier

Franchising and the African economy

  • According to the Franchise Association of South Africa’s 2013 franchise survey, 84 local franchisors have successfully expanded into Africa
  • Africa’s economy of approximately $1,6 trillion is expected to grow to $2,6 trillion in the next five years
  • Since 2009, Angola, Nigeria, Ghana, Zambia and DRC have become top investment destinations
  • Kenya and Nigeria are in the top six of the world’s fastest growing economies, with Kenya surpassing India in third place, while Nigeria outpaces Malaysia in sixth place
  • Main sectors for development include mining, construction, property development, retail, supplier services for gas and oil, mobile, ICT, security, agriculture, tourism and hospitality
  • Of Africa’s one billion population, almost 50% are under the age of 35 and nearly half live in cities
  • 69% of 217 surveyed brands showed interest in expanding into Africa.

Favourable sectors

These are the total number of South African franchise outlets per sector in Africa

11 – Construction and related

12 – Real estate

28 – Automotive

33 – Childcare, education and training

41 – Building, office and home services

82 – Fast foods and restaurants

98 – Retailing

With the African economy steadily growing, a number of South African franchisees have already expanded into Africa. According FASA’s 2013 franchise survey, 84 franchisers have operations in ten African countries.

The top countries are Botswana with 37 South African franchise outlets in operation, Namibia with 35, Swaziland with 26, Zimbabwe with 20, and Zambia with 16 outlets.

Tracy Lee Nicol
About the Author
Tracy-Lee Nicol is the managing editor of Franchise Zone Magazine and deputy editor of Entrepreneur Magazine. She studied her Masters degree in Art History and Visual Culture at Rhodes University and spent the next two years working and travelling in Asia. Her love of people, business and teaching is reflected in telling the stories of entrepreneurs, franchisees and franchisors, inspiring others to take the leap to being their own boss and bringing about positive change in South Africa.

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