• A specialist research firm focused on providing quality business analysis
• Draws on the depth of DC Strategy's experience as a specialist consulting and legal firm in developing many of the region's most successful networks and brands
• Prepares independent business reports on Australian franchise systems for prospective franchisees

Franchise Business Report

The reports provide prospective franchisees with access to detailed, industry wide information to contribute towards an informed decision when assessing the risk, returns and detail of any franchise system.

The research team conducted over two years of research, analysis, focus groups, and interviews to complete the most wide reaching research and factual analysis of franchising in Australia. The Commonwealth Bank of Australia is a proud supporter of this initiative and has been working closely with DC Strategy over this time. The involvement of Commonwealth Bank of Australia recognises the presence, expertise and experience that their specialist franchise and business lending teams bring to franchising in Australia.

Why have DC Strategy Research prepared 'Independent Franchise Business Reports'?

There were two key catalysts for the business decision.

1. As a specialist consulting and legal firm, DC Strategy has actually built networks and brands around the world and as a result we have a detailed and specialist understanding of what to look for in a high quality franchise system and how a business needs to evolve over many years to remain relevant to the consumer and franchisees. DC Strategy has developed the bank accreditation frameworks for a majority of the banks in the franchise sector which required a detailed understanding of franchise finance practices in Australia.

   As a result, DC Strategy receives a significant amount of calls every week from prospective franchisees that are seeking to gain commercial advice as to which franchise to purchase. It is not prudent to provide a response to such a request without conducting detailed research. The preparation of factually based 'Independent Franchise Business Reports' provides a constructive channel to communicate independent, detailed and factual information to franchisees that are interested in making an informed decision.

2. Our detailed analysis of the 1000+ franchisors in Australia has reinforced our professional perspective as a specialist that there are too many businesses and franchisors that should not be in franchising. As a consequence, there is genuine concern that there may be unnecessary future regulation that seeks to curtail the poor practices of a very small sample of ill equipped franchisors or franchisees that would have an unhealthy impact on the highest quality franchisors that account for the majority of franchisees in Australia.

Franchising in Australia is in a very healthy state and the vast majority of Greenfield and secondary resale activity of franchises in Australia is accounted for by the top 150-200 franchisors. There are around 600-700 franchise systems that have not scaled sufficiently to warrant adopting a franchise strategy that can still have a small handful of successful franchisees but overall they are not driving a proactive well structured growth strategy. There is a significant amount of misunderstanding about franchising in Australia in many circles and it is important to state that whilst around 600-700 franchise systems have insufficient scale that is not to say they have extensive levels of disputes or should not be in business. The issue is there is a profound difference between a franchisor that has built a quality infrastructure, business and franchise system and continues to scale and those which have a 'home-made' franchise system and have usually sourced a legal agreement as the basis of franchising without developing the necessary infrastructure for growth.

The success of franchising is built on sustainable, profitable growth of both franchisor and franchisee. It is not defined by the number of franchisors but the depth and quality of each business and the success of each franchisee. Australian franchising operates in a highly regulated environment dictated by the Franchising Code of Conduct as part of the Trade Practices Act. The Franchising Code of Conduct was introduced in Australia in 1998 and has had a profound and positive impact in shaping many of the 'best practice' standards in franchising anywhere in the world.

What is the objective of providing 'Independent Franchise Business Reports'?

The objective is to more easily identify and compare the better franchise systems in Australia and make quality information more accessible to the highest quality franchisees. As a result, prospective franchisees that are serious about evaluating and comparing franchise opportunities now have a trusted and independent source of information to contribute towards making a fully informed decision about which franchise to become involved with to build an asset for the future.

How has the information been prepared?

Over the past two years the team at DC Strategy Research have researched and analysed many franchise systems in significant detail. Importantly, we ran a series of discussion forums with past, current and prospective franchisees. We have combined a commercial, legal, and financial understanding of franchising from both a franchisor, franchisee and banking perspective to detail information and build the website in a manner that provides high quality information to those who are prepared to purchase a franchise business report.

The DC Strategy Research team has personally sat down with each and every franchisor that has had a report prepared to ensure there is a clear understanding of what is being achieved and that the information is as accurate as possible. This has been done on a completely independent basis. The response from franchisors towards the initiative has been extremely positive and viewed as a great opportunity to ensure franchisees make as fully informed a decision as possible.

Why not provide a ranking system?

Our specialist perspective has lead us to the conclusion a ranking system for franchisor's is totally inappropriate and not capable of being done in a manner that is actually meaningful to a franchisee's decision making process. Any ranking is subjective no matter whether it is franchisee, franchisor or independent. More importantly, a ranking system by its nature infers people are better the higher up the ranking they are and this could not be further from the truth in franchising in Australia.

The key reasons a ranking system is inappropriate are franchisees have predetermined levels of capital they can afford to invest and franchisors are all at different stages of their growth cycle. When you have a detailed understanding of what makes a franchisor successful in start up, growth, maturity and reinvigoration or decline phase any ranking system simply cannot encapsulate the variety of issues and the differing levels of capital investment that automatically categorises the groups a franchisee may consider.