SME's - why is franchising not more popular in Africa

Guest post by: Dr. Rob Smorfitt
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SMEs and entrepreneurs in Africa - By Dr. Rob Smorfitt

Franchising has found a happy home in South Africa, but you seldom see franchises in other African countries, or at least not on the scale that they are in South Africa.

Is the problem the lack of spending power in these countries? Are the markets too small? Is poverty too big a factor in these economies?

Even South Africa has found this to be a problem. However the South African franchises have also found a solution. Some of the franchises have launched small format stores to cater for lower traffic volumes. These are seen in petrol stations, and exhibition halls and other low traffic areas where a normal format store would not be cost effective.

Also, why so few indigenous franchises. South Africa has generated a fair number of it's own franchises and some like Nando's have taken their product internationally. Why not other African countries?

There are some meals, such as samp and beans and bunny chow for example, which I believe are uniquely African, but which could easily be turned into a successful franchise opportunity.

So what is stopping Africa from entering this lucrative market?

Rob Smorfitt

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SMEs and entrepreneurs in Africa - By Dr. Rob Smorfitt

About the Author: Dr. Rob Smorfitt

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Have an MBA and a PhD in entrepreneurship. Three key areas of ongoing research are entrepreneurship and innovation in large business strategy, the impact of legislation on SME development and SME finance. Run my own SME blog at http://sme-smb-smme.blogspot.com as well as an entrepreneurship and innovation for large businesses blog at http://innoveur.blogspot.com. I have been self-employed since 1982. I have started or purchased in excess of 50 businesses since then. Most were sold again and a few were shut down because of a lack of profitability. Many were run by staff or family while I worked full time in my bigger businesses. Author of 6 books. Written articles for various magazines, newspapers and websites. Experienced in research within developing countries.
Click here to visit Dr. Rob's website.

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