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TARGETTING POTENTIAL

FRANCHISEES:
Industry sector backgrounds
and declared areas of interest

David Purdy
Professor John Stanworth

INTERNATIONAL FRANCHISE RESEARCH CENTRE

SPECIAL STUDIES SERIES NO.3


JUNE 1994

PUBLISHED BY UNIVERSITY OF WESTMINSTER PRESS


ISBN 1 85919 006 5
THE INTERNATIONAL FRANCHISE International Journal (MCB University
Press). Additionally, Franchise Growth And
RESEARCH CENTRE (IFRC) 1993-2007
Failure In The U.S. And The U.K.: A
University of Westminster, London, UK.
Troubled Dreamworld Revisited received the
Best International Paper Award in 1997,
"The International Franchise Research
again from the Society of Franchising. This
Centre (IFRC) is committed to
paper was later published in Franchising
improving the understanding of
Research: An International Journal.
franchising. This is achieved by the
publication of impartial research and
Close links were fostered with universities in
by the encouragement of informed
Rome and Pisa (Italy), Haute Alsace
debate."
(France) and Boston, Minneapolis and
Texas (USA), with a view to research
Franchising operates in a dynamic environ-
collaboration. Professor Pat Kaufmann of
ment, with new issues and challenges
Atlanta, Georgia, addressed our inaugural
emerging, including: globalisation, coping
annual strategy seminar, in 1994. Overseas
with competition, disclosure, industry
speakers in subsequent years included
regulation, managing relations with
Cheryl Babcock, Director of the Franchising
franchisee associations, franchisee
Institute, University of St. Thomas,
recruitment & market saturation.
Minneapolis (1995), Professor Rajiv Dant,
University of Boston (1996), Professor
Against this backdrop, the IFRC was
Francine Lafontaine, University of Michigan
established in 1993 by Professor John
(1997), Professor Claude Nègre, University
Stanworth (Director of the Future of Work
of Haute Alsace (1997), Colin McCosker,
Research Group at the University of
University of Southern Queensland (1998),
Westminster), supported by Brian Smith (ex-
Professor Frank Hoy, University of Texas at
BFA Chairman, franchisee, franchisor and
El Paso (1998), Professor Jack Nevin,
author), and Chair of its Steering Group.
University of Wisconsin-Madison (1999),
Professor Tom Wotruba, San Diego State
FOUNDER MEMBERS
University (1999), Professor Bruce Walker,
University of Missouri, (2000), and,
Founder members and sponsors included:
Professor Wilke English, University of Mary
Barclays Bank, the British Franchise
Hardin-Baylor (2000).
Association (BFA), Dyno-Rod, Franchise
Development Services Ltd., Lloyds Bank
IFRC members were active supporters of the
(now Lloyds Group), Mail Boxes Etc.,
International Society of Franchising, and
Midland Bank (now HSBC), Prontaprint,
hosted the ISoF 2005 conference in London.
Rosemary Conley Diet & Fitness Clubs,
Royal Bank of Scotland, The Swinton Group,
The IFRC ceased its research activities in
and Wragge & Co.
2007, when John Stanworth took retirement.
PUBLICATIONS
Web versions of IFRC Special Studies
Series Papers 1993-2001 (listed overleaf)
Their support enabled the IFRC to publish a
number of reports, including its Special
Many of the earlier papers have been re-set,
Studies Series Papers, journal articles,
to allow a successful conversion to Acrobat,
book chapters and conference papers.
and are now available online.
Two IFRC papers received three awards
John Stanworth, Emeritus Professor,
over a period of 12 months (1996-97). The
University of Westminster
first being Business Format Franchising:
http://www.westminster.ac.uk/schools/
Innovation & Creativity or Replication &
business
Conformity ?, which received the Best
International Paper Award in 1996, from the
David Purdy, Visiting Fellow,
Society of Franchising. This paper also
Kingston University
received the Outstanding Paper of 1996
http://business.kingston.ac.uk/sbrc
award from Franchising Research: An
December 2010

International Franchise Research Centre Special Studies Series Papers 1-16 Web Versions 2010 p.1
LIABILITY DISCLAIMER 10 London: A Capital City For Franchisee
Recruitment, (Mills, Stanworth &
The information and analysis in each report Purdy), 1997
is offered in good faith. However, neither the
publishers, the project sponsors, nor the 11 The Effectiveness of Franchise
author/s, accept any liability for losses or Exhibitions in the United Kingdom,
damages which could arise for those who (Chapman, Mills & Stanworth), 1997
choose to act upon the information or
analysis contained herein. 12 Franchising: Breaking Into European
Union Markets, (Stirland, Stanworth,
IFRC Special Studies Papers 1993-2001 Purdy & Brodie), 1998

Web versions published online December 13 Succeeding As A Franchisor,


2010, via http://www.scribd.com/: (Stanworth & Purdy, published jointly
with Business Link London Central),
1 The Blenheim/University of 1998
Westminster Franchise Survey:
Spring 1993, (Stanworth & Purdy), 14 Direct Selling: Its Location in a
1993 Franchise Typology, (Brodie &
Stanworth), 1999
2 Improving Small Business Survival
Rates via Franchising: The Role of the 15 Unravelling the Evidence on
Banks in Europe, (Stanworth & Stern), Franchise System Survivability,
1993 (Stanworth, Purdy, English &
Willems), 1999
3 Targeting Potential Franchisees:
Industry Sector Backgrounds and 16 Survey: Professional Services For
Declared Areas of Interest, (Purdy & Franchising In The U.K., (Stanworth &
Stanworth), 1994 Purdy), 2001

4 The Impact of Franchising on the


Development Prospects of Small &
Medium-sized Enterprises (SMEs) in
Europe, (Stanworth & Purdy), 1994

5 The Blenheim/University of
Westminster Franchise Survey: A
Comparison of UK and US Data,
(Stanworth, Kaufmann & Purdy), 1995

6 Developing a Diagnostic
Questionnaire as an Aid to Franchisee
Selection, (Stanworth), 1995

7 Franchising as a Source of
Technology-transfer to Developing
Economies, (Stanworth, Price, Porter,
Swabe & Gold), 1995

8 Aspects of Franchisee Recruitment,


(Macmillan), 1996

9 Business Format Franchising:


Innovation & Creativity or Replication
& Conformity ?, (Stanworth, Price,
Purdy, Zafiris & Gandolfo), 1996

International Franchise Research Centre Special Studies Series Papers 1-16 Web Versions 2010 p.2
INTRODUCTION BACKGROUND TO THE SAMPLE

Our first Special Studies Series report, Paper Blenheim Exhibitions and Conferences
No.1, explored key characteristics associated Limited organise two National Franchise
with the employment status of potential Exhibitions. The first of these, in the Spring, is
franchisees. The analysis contrasted those held at Olympia (London), and the second, in
having a self-employed background against the Autumn, at the National Exhibition Centre
those without such experience. (Birmingham). Each attracts around 10,000
paying visitors, a large proportion of whom
For that study, the sample was based on supply a completed registration card
some 300 face-to-face interviews of potential questionnaire on entry.
franchisees who were visiting a franchise
exhibition held in London, during Spring 1993. An entrance fee in the region of £10 is levied
Several issues were investigated, including and previous research shows that many
the main purpose for visiting the exhibition, people travel considerable distances to attend
the likelihood of buying a franchise, the main the exhibition. These suggest that the act of
appeal of franchising and the availability of attendance is usually not undertaken lightly
finance. and is probably a useful gauge of serious
intent.
The effective and efficient targetting of
potential franchisees is a key issue in the
industry - with special reference to the THE SAMPLE
challenge of raising conversion rates and
reducing the unit cost per successful The analysis presented here is based on data
recruitment - and it was felt that a breakdown collected at the Spring National Franchise
of declared sector interests against current Exhibition, held at Olympia on 26-28th March,
activities would help to build upon the analysis 1993, which attracted 9,368 visitors.
presented in our first report.
Our sample relates to 5,114 registration card
questionnaires - some 55% of the total
number of visitors - representing a very high
sampling rate when compared with most
surveys, which significantly reduces the error
component associated with absolute sample
size.

Within this sample were 3,619 potential


franchisees and it is their responses upon
which the analysis is based.

Our findings are presented mainly in a


graphical form, showing not only the ranked
distributions within various sub-sectors, but
also illustrating the extent to which the
current business activities of potential
franchisees tend to be associated with their
target interests.

International Franchise Research Centre - Special Studies Series Paper No.3 1


HIGHLIGHTS ■ Excluded sectors - for those franchisors
tending to exclude potential franchisees
The main conclusions to be drawn from our having experience in the franchisor's own
analysis were: industry sector, the adjacent sectors
shown in the ranked histograms (Figures 4
■ Sectors attracting the greatest interest to 15) could contain sufficient numbers of
- ignoring a 'general interest' option, the top potential franchisees to warrant being
3 sectors, in terms of number of potential targetted.
franchisees attending the exhibition, were
found to be: ■ No specified 'target' interest - 20% did
not specify any sectors at all, ignoring the
- Fastfood/Restaurant/Catering 'general' option, too. Again, this may
- Business Services suggest that a potential franchisee in this
- Retail Shops group is at a relatively early stage in
Each of these 'target' sectors attracted seeking to conclude a franchise
some 20% of the sample (see Figure 1). relationship.

■ General interest in franchising - 60% of ■ Diversity of interest areas - one in two


the potential franchisees recorded a (48%) potential franchisees recorded only
general interest in franchising. Multiple one sector of interest (including the
selections of specific sectors were allowed, 'general' option), although 16% said they
but a separate analysis has shown that were interested in 2 sectors, 12% in 3, 8%
half of these (30% of the sample) selected in 4, with another 8% in 5 or more.
the 'general' option alone. For this latter
group, this might indicate either an ■ Diversity of current sectors - there was
openminded-ness about the best franchise a tendency for potential franchisees to see
solution and/or that members of this group their current activity as spanning a single
were some distance in time from wishing to sector, with two-thirds (69%) identifying
conclude a franchise agreement. just 1 sector, and 8% selecting 2.

■ Specific 'target' interests and current ■ Further analysis - theoretically, at least,


sector - for some sectors there was a data compiled by exhibitors (franchisors)
predominant correlation - both in terms of could yield useful information in terms of
absolute numbers, and as a proportion of sectoral comparisons and conversion
the respective current sector - between a ratios, although it is appreciated that many
given current sector of potential exhibition enquiry recording systems may
franchisees and an identical or similar not collect this level of detail.
'target' sector. This was evident in the
following sectors:
- Automotive
- Building/Maintenance
- Business Services
- Food/Catering
- Retailing
Looking solely at the extent to which
people in the other current sectors were
interested in their own sector, the Health/
Leisure and Printing/Photography 'target'
sectors achieved the highest ranking for
their own current sectors, too (see Figures
7b and 9b - the full sectoral breakdown is
illustrated by Figures 4 to 15).

International Franchise Research Centre - Special Studies Series Paper No.3 2


THE QUESTIONNAIRE Current Sectors

Visitors were asked to identify the capacity in The sectors for current involvement were:
which they were visiting the exhibition, and the
options offered were: ❏ Automotive
❏ Building/Maintenance
❏ Potential franchisee ❏ Business services
❏ Existing franchisee ❏ Education/Training
❏ Potential franchisor ❏ Financial
❏ Existing franchisor ❏ Food/Catering
❏ Potential master licensee ❏ Health/Leisure
❏ Consultant ❏ Legal
❏ Printing/Publishing
Areas of Interest ❏ Retail
❏ Sales & Marketing
The options for areas of interest were: ❏ The Forces
❏ Automotive Figure 1 indicates the response rates for
❏ Beauty/Fashion each area of interest sector ('target' sector),
❏ Building/Maintenance calculated as a proportion of the total number
❏ Business services of potential franchisees in the sample. For
❏ Distribution/Delivery Service example, 2,185 (i.e. 60%) of the sample's
❏ Fastfood/Restaurant/Catering 3,619 potential franchisees recorded that they
❏ Health/Leisure had a 'General interest in franchising'.
❏ Interiors/DIY/Security Figure 2 presents the previous distribution in
❏ Laundry/Dry cleaning/Cleaners terms of current sector activity - the total
number of potential franchisees falling in each
❏ Printing/Photography
sector is shown in parentheses, e.g. (2,185).
❏ Retail shops
Figure 3 illustrates the extent to which
❏ Workshop consumables multiple selections were recorded.
❏ General interest in franchising

Fig 1 - POTENTIAL FRANCHISEES: SECTORS OF INTEREST

Multiple choices allowed (Sample = 3,619 Potential Franchisees)

60% General interest in franchising = 2,185


20% Fastfood/Restaurant/Catering = 711
20% Business services = 708
19% Retail shops = 705
16% Health/Leisure = 566
15% Distribution/Delivery Service = 526
10% Printing/Photography = 372
9% Automotive = 312
7% Building/Maintenance = 271
7% Beauty/Fashion = 266
7% Interiors/DIY/Security = 245
5% Laundry/Dry cleaning/Cleaners = 167
4% Workshop consumables = 129

International Franchise Research Centre - Special Studies Series Paper No.3 3


Fig 2 - POTENTIAL FRANCHISEES: SECTOR INTEREST vs. CURRENT SECTOR

50%

45%

40%

35%
Proportion
of
30% Sub-sample
(Sector of Interest)
25%
n=3,619
20%

15%

10%
General interest in franchising = 2,185
Fastfood/Restaurant/Catering = 711 5%
Business services = 708
Retail shops = 705 0%
Health/Leisure = 566
Distribution/Delivery Service = 526 No sector
B/Services (719)
Printing/Photography = 372 Sales (540) (571)
Automotive = 312 Retail (410)
Financial
Building/Maintenance = 271
Building (371)
Sector(s) of Interest Beauty/Fashion = 266 Food (306) (341)
Interiors/DIY/Security = 245 Health (238)
Automotive Current Sector(s)
Laundry/Dry cleaning/Cleaners = 167 (226)
Education
Workshop consumables = 129 Printing (165)
The Forces (135)
Legal (52) (102)
Fig 3 - POTENTIAL FRANCHISEES: SECTOR INTEREST vs. CURRENT SECTOR
Extent of multiple selections

69%
70%

60%

(*) Includes those 48% (*)


50%
expressing a 'general
interest' only
40%
Sample
n=3,619
30%
4%
16% 12% 8% 4% 3% 8% 20% 20%
37%
10%
8%
0%
All Respondents 8% 5%
12%
1% All
Respond
3+ Sectors 6+ areas ents
9% 5 areas
2 Sectors 3%
4 areas
Current 1 Sector 4% 3 areas
Sector
No sector 2 areas
Target Sector Interest
1 area
including 'General'
No
selection
Fig 4a - INTEREST IN FASTFOOD/RESTAURANT/CATERING:
Current Sectors of Respondents Expressing Interest (n=711)

26% Food/Catering
16% No current sector
15% Retail
14% Business Services
12% Sales & Marketing
10% Financial
9% Health/Leisure
9% Building/Maintenance
5% Automotive
5% Education/Training
4% Printing/Publishing
2% Legal
2% The Forces

Figures 4 to 15 present a breakdown of the target sector that can be attributed to each
individual sectoral (target) interests in current sector, and figure b recalculates
Figure 1 (and Figure 2) against the current each current sector response as a proportion
sectors of those expressing such interests. of the total number of potential franchisees
identifying themselves with the respective
Each figure has two charts: figure a indicates current sector. N.B. Some people identified
the proportion of the overall interest in the themselves with more than one sector.

Fig 4b - INTEREST IN FASTFOOD/RESTAURANT/CATERING:


% Of Each Current Sector (of total in brackets) Expressing Interest

59% Food/Catering (306)


33% Legal (52)
26% Health/Leisure (238)
25% Retail (410)
21% Education/Training (165)
20% Printing/Publishing (135)
20% Financial (371)
18% Building/Maintenance (341)
18% Business Services (571)
17% Automotive (226)
16% No current sector (719)
15% Sales & Marketing (540)
13% The Forces (102)

International Franchise Research Centre - Special Studies Series Paper No.3 6


Fig 5a - INTEREST IN BUSINESS SERVICES:
Current Sectors of Respondents Expressing Interest (n=708)

34% Business Services


22% Sales & Marketing
18% Financial
12% No current sector
9% Retail
7% Education/Training
7% Building/Maintenance
7% Health/Leisure
6% Printing/Publishing
5% Food/Catering
4% Automotive
3% The Forces
2% Legal

Fig 5b - INTEREST IN BUSINESS SERVICES:


% Of Each Current Sector (of total in brackets) Expressing Interest

42% Business Services (571)


35% Financial (371)
33% Legal (52)
32% Education/Training (165)
32% Printing/Publishing (135)
29% Sales & Marketing (540)
21% The Forces (102)
21% Health/Leisure (238)
16% Retail (410)
15% Building/Maintenance (341)
12% Food/Catering (306)
12% Automotive (226)
11% No current sector (719)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 7


Fig 6a - INTEREST IN RETAIL SHOPS:
Current Sectors of Respondents Expressing Interest (n=705)

28% Retail
17% No current sector
16% Business Services
16% Sales & Marketing
11% Financial
10% Food/Catering
7% Building/Maintenance
6% Health/Leisure
5% Automotive
4% Education/Training
4% Printing/Publishing
2% The Forces
2% Legal

Fig 6b - INTEREST IN RETAIL SHOPS:


% Of Each Current Sector (of total in brackets) Expressing Interest

48% Retail (410)


24% Food/Catering (306)
23% Legal (52)
21% Sales & Marketing (540)
21% Financial (371)
20% Business Services (571)
19% Printing/Publishing (135)
19% Education/Training (165)
17% Health/Leisure (238)
16% Automotive (226)
16% No current sector (719)
14% Building/Maintenance (341)
12% The Forces (102)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 8


Fig 7a - INTEREST IN HEALTH/LEISURE:
Current Sectors of Respondents Expressing Interest (n=566)

20% Sales & Marketing


17% Business Services
17% Health/Leisure
16% No current sector
12% Financial
11% Food/Catering
11% Retail
8% Building/Maintenance
8% Education/Training
5% Automotive
5% Printing/Publishing
3% The Forces
2% Legal

Fig 7b - INTEREST IN HEALTH/LEISURE:


% Of Each Current Sector (of total in brackets) Expressing Interest

40% Health/Leisure (238)


26% Education/Training (165)
21% Sales & Marketing (540)
21% Food/Catering (306)
19% Printing/Publishing (135)
18% Financial (371)
17% Legal (52)
17% Business Services (571)
16% The Forces (102)
15% Retail (410)
13% No current sector (719)
13% Building/Maintenance (341)
12% Automotive (226)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 9


Fig 8a - INTEREST IN DISTRIBUTION/DELIVERY SERVICE:
Current Sectors of Respondents Expressing Interest (n=526)

19% No current sector


19% Business Services
17% Sales & Marketing
12% Retail
11% Financial
9% Automotive
7% Building/Maintenance
7% Food/Catering
5% The Forces
5% Health/Leisure
5% Education/Training
5% Printing/Publishing
2% Legal

Fig 8b - INTEREST IN DISTRIBUTION/DELIVERY SERVICE:


% Of Each Current Sector (of total in brackets) Expressing Interest

27% The Forces (102)


22% Automotive (226)
18% Printing/Publishing (135)
17% Legal (52)
17% Business Services (571)
17% Sales & Marketing (540)
16% Financial (371)
15% Education/Training (165)
15% Retail (410)
14% No current sector (719)
12% Food/Catering (306)
11% Building/Maintenance (341)
11% Health/Leisure (238)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 10


Fig 9a - INTEREST IN PRINTING/PHOTOGRAPHY:
Current Sectors of Respondents Expressing Interest (n=372)

20% Business Services


19% Sales & Marketing
19% Printing/Publishing
18% No current sector
11% Retail
10% Financial
10% Building/Maintenance
7% Education/Training
6% Automotive
5% Food/Catering
3% Health/Leisure
2% Legal
1% The Forces

Fig 9b - INTEREST IN PRINTING/PHOTOGRAPHY:


% Of Each Current Sector (of total in brackets) Expressing Interest

51% Printing/Publishing (135)


16% Education/Training (165)
13% Business Services (571)
13% Sales & Marketing (540)
12% Legal (52)
11% Building/Maintenance (341)
10% Financial (371)
10% Retail (410)
9% Automotive (226)
9% No current sector (719)
6% Food/Catering (306)
5% Health/Leisure (238)
5% The Forces (102)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 11


Fig 10a - INTEREST IN THE AUTOMOTIVE SECTOR:
Current Sectors of Respondents Expressing Interest (n=312)

38% Automotive
17% No current sector
15% Sales & Marketing
13% Business Services
10% Building/Maintenance
9% Retail
8% Financial
6% Health/Leisure
5% Food/Catering
4% Printing/Publishing
3% Education/Training
3% The Forces
2% Legal

Fig 10b - INTEREST IN THE AUTOMOTIVE SECTOR:


% Of Each Current Sector (of total in brackets) Expressing Interest

52% Automotive (226)


13% Legal (52)
9% Building/Maintenance (341)
9% Printing/Publishing (135)
9% The Forces (102)
9% Sales & Marketing (540)
8% Health/Leisure (238)
7% No current sector (719)
7% Business Services (571)
7% Financial (371)
7% Retail (410)
6% Food/Catering (306)
5% Education/Training (165)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 12


Fig 11a - INTEREST IN BUILDING/MAINTENANCE:
Current Sectors of Respondents Expressing Interest (n=271)

48% Building/Maintenance
15% No current sector
14% Business Services
11% Sales & Marketing
8% Automotive
7% Financial
7% Food/Catering
7% Retail
4% Health/Leisure
3% Education/Training
2% The Forces
2% Legal
2% Printing/Publishing

Fig 11b - INTEREST IN BUILDING/MAINTENANCE:


% Of Each Current Sector (of total in brackets) Expressing Interest

38% Building/Maintenance (341)


12% Legal (52)
10% Automotive (226)
7% Food/Catering (306)
6% Business Services (571)
6% The Forces (102)
6% No current sector (719)
5% Financial (371)
5% Sales & Marketing (540)
5% Health/Leisure (238)
4% Retail (410)
4% Education/Training (165)
4% Printing/Publishing (135)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 13


Fig 12a - INTEREST IN BEAUTY/FASHION:
Current Sectors of Respondents Expressing Interest (n=266)

25% No current sector


21% Sales & Marketing
16% Retail
15% Health/Leisure
13% Business Services
11% Financial
8% Education/Training
6% Building/Maintenance
5% Food/Catering
3% Printing/Publishing
3% Automotive
2% Legal
0% The Forces

Fig 12b - INTEREST IN BEAUTY/FASHION:


% Of Each Current Sector (of total in brackets) Expressing Interest

17% Health/Leisure (238)


12% Education/Training (165)
12% Legal (52)
10% Retail (410)
10% Sales & Marketing (540)
9% No current sector (719)
8% Financial (371)
7% Printing/Publishing (135)
6% Business Services (571)
5% Building/Maintenance (341)
5% Food/Catering (306)
4% Automotive (226)
1% The Forces (102)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 14


Fig 13a - INTEREST IN INTERIORS/D.I.Y./SECURITY:
Current Sectors of Respondents Expressing Interest (n=245)

22% Building/Maintenance
19% No current sector
19% Sales & Marketing
13% Business Services
13% Retail
9% Financial
7% Health/Leisure
6% The Forces
5% Automotive
4% Food/Catering
4% Education/Training
2% Printing/Publishing
2% Legal

Fig 13b - INTEREST IN INTERIORS/D.I.Y./SECURITY:


% Of Each Current Sector (of total in brackets) Expressing Interest

16% Building/Maintenance (341)


14% The Forces (102)
10% Legal (52)
9% Sales & Marketing (540)
8% Retail (410)
7% Health/Leisure (238)
7% No current sector (719)
6% Financial (371)
6% Education/Training (165)
6% Business Services (571)
5% Automotive (226)
4% Printing/Publishing (135)
3% Food/Catering (306)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 15


Fig 14a - INTEREST IN LAUNDRY/DRY CLEANING/CLEANERS:
Current Sectors of Respondents Expressing Interest (n=167)

21% No current sector


19% Sales & Marketing
17% Business Services
16% Retail
10% Financial
10% Food/Catering
7% Automotive
7% Education/Training
7% The Forces
6% Building/Maintenance
5% Health/Leisure
4% Printing/Publishing
2% Legal

Fig 14b - INTEREST IN LAUNDRY/DRY CLEANING/CLEANERS:


% Of Each Current Sector (of total in brackets) Expressing Interest

11% The Forces (102)


7% Education/Training (165)
6% Retail (410)
6% Sales & Marketing (540)
6% Legal (52)
5% Automotive (226)
5% Food/Catering (306)
5% Business Services (571)
5% No current sector (719)
4% Printing/Publishing (135)
4% Financial (371)
4% Health/Leisure (238)
3% Building/Maintenance (341)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 16


Fig 15a - INTEREST IN WORKSHOP CONSUMABLES:
Current Sectors of Respondents Expressing Interest (n=129)

26% No current sector


18% Automotive
17% Business Services
17% Sales & Marketing
15% Building/Maintenance
9% Retail
8% The Forces
6% Health/Leisure
5% Financial
5% Printing/Publishing
5% Food/Catering
2% Education/Training
2% Legal

Fig 15b - INTEREST IN WORKSHOP CONSUMABLES:


% Of Each Current Sector (of total in brackets) Expressing Interest

10% Automotive (226)


10% The Forces (102)
6% Legal (52)
6% Building/Maintenance (341)
5% Printing/Publishing (135)
5% No current sector (719)
4% Sales & Marketing (540)
4% Business Services (571)
3% Health/Leisure (238)
3% Retail (410)
2% Food/Catering (306)
2% Financial (371)
2% Education/Training (165)

Note: 1. 'Respondent' = 'Potential Franchisee' (the sample comprises 3,619 potential franchisees)
2. A minor proportion of the respondents identified themselves with more than one current sector
(if each respondent had selected only 1 current sector, then the corresponding percentages in figure 'a'
would total exactly 100%)

International Franchise Research Centre - Special Studies Series Paper No.3 17


Interest Gauged as a Proportion of of the potential franchisees presently
All Respondents Belonging to a Current Sector belonging to that sector expressed an interest
in Workshop Consumables. That is, 23 (10%)
The preceding 'a' figures present the out of a total of 226 in the Automotive 'current'
responses as a proportion of those potential sub-sample.
franchisees expressing an interest in a
given 'target' sector. Each of these figures, With this latter breakdown, there may be a
therefore, indicates the extent to which the ready explanation for three out of four of the
individual current sectors might contribute sectors registering the greatest proportion of
potential franchisees out of an overall respective current sector interest in Workshop
population of exhibition visitors. Consumables. Namely, that there is possibly
a greater tendency for people in the
For example, in Figure 15a - concerning Automotive, The Forces and Building/
interest in Workshop Consumables - the Maintenance sectors to have achieved some
greatest level of interest, 26% out of 129, familiarity with the type of products associated
came from those who did not specify any with Workshop Consumables. Whereas a lack
current sector. At the opposite end of the of, or lesser, familiarity may explain those at
spectrum, the lowest response rate, 2%, the opposite end of the spectrum - in Food/
came from those recording their current Catering, Financial and Education/ Training.
activity as being the Legal sector. Thus, the
group indicating the highest level of interest
contained over 10 times as many people in CONVERSION FROM POTENTIAL
the lowest, that is 33, against 3. TO ACTUAL FRANCHISEE

However, when the responses are calculated The source data - of visitors to a franchise
as a proportion of the total number of exhibition - allows us to suggest various
potential franchisees presently belonging distributions of sector interest against current
to a given current sector, a different picture sector background for potential franchisees.
emerges, as indicated by each 'b' figure. However, if we use a simple model, such as
the one shown in Figure 16 (below, based on
Thus Figure 15b also provides a breakdown of a traditional approach to selling), whereby the
those interested in Workshop Consumables, conversion to a franchisee involves a number
except that the percentages here refer to the of stages progressing from a larger
total number of potential franchisees in each population, reducing in size at each stage as
current sector. The highest response rate the final goal is approached, then our sectoral
came from the Automotive sector, where 10% analysis could be seen as relating to the

Fig 16 - SIMPLE STAGE MODEL:


THE CONVERSION FROM POTENTIAL TO ACTUAL FRANCHISEE

Attention > Interest > Desire > Action

International Franchise Research Centre - Special Studies Series Paper No.3 18


middle stage, 'interest'.

As far as franchisors are concerned, it could


be argued that it is at this point where their
responsibility in the conversion process takes
over from that of the exhibition organiser.

International Franchise Research Centre - Special Studies Series Paper No.3 19


AUTHORS INTERNATIONAL FRANCHISE RESEARCH CENTRE

John Stanworth is the director of the The International Franchise Research Centre
International Franchise Research Centre (I.F.R.C.) is committed to improving the
and has been engaged in research into understanding of franchising. This is achieved
franchising since the mid-1970s. He also by the publication of impartial research and by
leads the Future of Work Research Group, the encouragement of informed debate.
based at the University of Westminster, which Membership is suitable for anyone with an
has a record of specialist research in interest in franchising and further details are
Teleworking, Small Business Development available from the address on the rear cover.
and Human Resource Management. Studies
have been undertaken for many clients,
including The Department of Trade & SPECIAL STUDIES SERIES
Industry, The Department for Education and
The Economic & Social Research Council. Papers in the Special Studies Series are
supplied free of charge to I.F.R.C. members
David Purdy is a researcher supporting the and are published a minimum of four times a
Future of Work Research Group. He has year. They report upon a range of issues
specialised in small business research since which are felt to be of interest to the
1985, and publications include authorship of franchising community. Subject matter
'Risk Capital for Small Firms', commissioned includes the findings of surveys of franchisors,
by the Small Business Research Trust. He franchisees, and potential franchisees, and
has also co-authored studies investigating also special interest matters, such as finance
Small Business Management Development for franchising.
and Teleworking.

The authors wish to express their gratitude to


Blenheim Group plc, London, for granting
permission to publish the survey findings.

International Franchise Research Centre - Special Studies Series Paper No.3 20