Facts & Figures

Berlin, 19.04.18
 

New franchise figures published

Deutscher Franchiseverband statistics show positive trend

Performance by the franchise industry in Germany was dynamic in 2017, as demonstrated by the Deutscher Franchiseverband’s analysis of statistics. Across Germany, some 970 franchise systems have 124,000 franchisees, up 3.6% on the previous year. In total, 162,000 franchise businesses (+1.9%) employ 707,000 people, an increase of 1.3%. The trend of growth in franchisees, businesses and employees of recent years therefore continues unabated. The trend in turnover is particularly telling: with 112.2 billion euros the German franchise industry recorded a significant rise of 8% compared to 2016.

As the body representing the interests of professional franchising, Deutscher Franchiseverband takes seriously its duty to provide substantive German franchise industry figures, data and facts. To obtain these, we look closely at last year and survey members and non-member franchise systems about individual and general trends. The results produce a pleasing picture for the German franchise industry as a whole: the growth trend of recent years has clearly continued. There have been record rates for new franchisee integration and system implementation.

Equally dynamic - turnover and franchisee trends

In 2017, the systems surveyed experienced perceptible partner growth - rounded up across the franchise industry as a whole, more than 4,400 new franchisees accounted for growth of 3.6%, which far exceeded last year’s growth of 1.8%. It is therefore hardly surprising that turnover was also dynamic, as more franchisees mean a greater number of businesses, which generate considerably more turnover. The result is a disproportionate rise over the past year. “Franchise industry performance has been extremely pleasing and is in line with the trend in the German economy as a whole”, is the assessment by Torben Leif Brodersen, Deutscher Franchiseverband’s Managing Director, of the latest figures. “The positive figures are also testament to much increased customer brand awareness, both online and offline. A fact from which the franchise industry is apparently benefitting”, according to Brodersen.

Sector reshuffle? Catering pushes retailing down to third place

There has been a reshuffle in franchising sectors for the first time in years. In the survey, catering (27%) now takes second place after the service sector, with 40%, pushing retail back to third place, with 23%. Handicrafts is by far the smallest franchising sector, with 10%. Next year’s statistics will show whether this is a long-term reshuffle.

The sectors may portray themselves as individual, but the systems surveyed have their development phase status in common. More than half of the systems surveyed (53%) stated that they are currently expanding, 16% are mature and 14% in the development phase.  These figures speak for the franchise systems’ desire to expand, which also shows in their expectations for the current year: the systems surveyed are planning to acquire an average of 10 new franchisees in 2018.

Focus on alternative target groups

The franchise systems are increasingly appealing to new target groups in order to grow their concept successfully. If, in the past, employees, professionals and managers were in first place (24%), they have now been overtaken by existing entrepreneurs (25%). They are followed by existing franchisees (18%), own employees (10%) and university graduates (7%). Franchise practice is therefore focussing more on the subject of multi-unit franchising.  “The German franchise industry is repositioning its expansion strategies. What was already apparent last year from the franchise barometer, our annual member survey, is now being confirmed by figures from the latest, reliable data”, is how Torben Leif Brodersen summarises the results. “It is also clear that if you want to satisfy your appetite for expansion, you should look at new and unconventional approaches to choosing target groups. The fact that this willingness is clear is testament to the German franchise industry’s agility and ability to innovate.” The same applies to the survey responses regarding alternative forms of expansion - 42% of systems surveyed deem multi-unit franchising to be important or even very important and more than half of them feel it is at least quite important. This is a future concept that has already reached everyday franchise practice.

Franchise industry drives jobs

In 2017 the franchise industry created 10,000 new jobs. This is an increase of 1.3%. A total of 707,000 people in the Federal Republic of Germany are employed full time, part time, or casually in franchise businesses. When extrapolated to full and part-time work, the trend is even more striking, with a rise of 2.3%. “Franchise systems’ success is based on a highly specialised cooperation. We encourage franchise systems to work on their employer brand and actively assist their franchisees with employee search and selection because brands not only make their mark through ambassadors for the system, but also through employees”, argues Torben Leif Brodersen. “If you enthuse good people about working for the system, you have already found tomorrow’s franchisee.”

About the survey

The 2017 franchise statistics were collated between 7 February and 4 March 2018. The Deutscher Franchiseverband e-mailed 248 members and 724 non-members. Net participation was 187 franchise systems, with a return rate of 19.3%. Prof. Achim Hecker, Digital Business University of Applied Sciences (under incorporation) was asked to conduct and analyse the survey.

The full results are available to download as a .pdf >>HERE<<.
 

About Deutscher Franchiseverband

Deutscher Franchiseverband represents the interests of the German franchise industry in national and international economic and political environments.  It was founded in 1978 and its head office is in Berlin. The Deutscher Franchiseverband is the industry’s quality association and represents franchisers and franchisees alike. The association currently covers more than 320 franchise systems. In 2017 the 970 franchisers active in Germany achieved turnover of 112 billion euros in conjunction with approx. 123,000 franchisees and 707,000 employees. 

 

Press contact:

Deutscher Franchiseverband e.V.
Press and PR Manager
Antje Katrin Piel
Luisenstr. 41
10117 Berlin
T +49 (0)30 278 902-12
piel@franchiseverband.com