Durban - The franchise sector is booming. In the past two years, revenue from 25 879 outlets soared 48 percent to R188 billion from R127 billion in the previous period.
This has contributed 12 percent to gross domestic product and creating an additional 180 000 jobs.
This is according to Standard Bank's Franchise Factor, a survey compiled by Franchize Directions, which said this week the number of jobs in the franchise sector soared 77 percent to 412 428 in the two years to February.
Frank Orchard, Standard Bank's head of franchising and strategic alliances, said: "The establishment of more than 6 000 sustainable small and medium-sized enterprises over two years  augurs well for the economy given the fundamental contributions made by SMEs to thriving economies worldwide."
Of those employed in the sector, about 24 000 people are owner/operators of franchise outlets, 372 518 are employees and the balance are employees of franchisors.
Colen Garrow, a Brait economist, said: "This is exactly where we should be creating jobs."
Bendeta Gordon, the managing director of Franchize Directions, said yesterday: "Franchising has been driven by the growth in the consumer market. Franchisors are taking up opportunities. There has been a lot of retail space that has become available."
The major employers in this sector are franchised retail stores, which account for 26 percent of the jobs in the sector, followed by fuel retailers, employing 23 percent, fast food outlets with 15 percent and restaurants with 13 percent.
Fuel retailers, of which there are seven franchisors, including Sasol and Engen, experienced turnover growth of 149 percent and contributed almost half the franchise sector's total revenue in the past two years.
The higher petrol price and car sales are driving the business for fuel retailers. In September new car sales rose to a record 37 791 units from the 36 457 units sold in September last year. Although there is still growth in car sales, it is slowing.
The real estate service sector was the second-largest contributor, totalling 31 percent of the sector's revenue, reflecting the buoyant property market. But this market, too, has come off the boil.
Of those who own franchises, 32 percent are black, rising from 23 percent in 2004. But if fuel retailers are excluded, black ownership stands at 27 percent. Of the 470 franchisors - those that own franchise systems - 68 are in the restaurant sector, such as Mugg & Bean and Spur. There are 64 fast food franchisors and 58 retail store franchisors.
Significant growth in new franchise systems was seen in building, office and home services, business services, restaurants and retail.
But some consider the franchise sector to be vulnerable to the impact of higher interest rates on spending. Giuseppe Jerman, an analyst at T-Sec, said: "The sector is susceptible to a slowdown in spending. With rising interest rates, pressure will build."
Others are optimistic. Gordon said: "I have great confidence the growth will be sustainable despite interest rate hikes. Consumers are not going away."