March 15 2019

New Franchise Ratings System to focus on performance and transparency.

FRANdata Australia today launched a new objective ratings system for Australian franchise brands.  If US experience is a guide the ratings system will quickly become the key industry standard for performance assessment and comparison.

FRANdata’s rating system recognises that renewed and enduring confidence in franchising requires a focus on performance and transparency.  A similar message has emerged from evidence to the recent Parliamentary Inquiry into Franchising.

FRANdata has built a set of standards to enable a consistent evaluation of Australian franchise systems. The foundation of these standards is the objective measurement of performance across critical areas of a franchise system.

The performance outcome metric is a graduated star rating scale.  The Franchise Rating Scale is underpinned by seven performance standards which include:

  1. System Performance
  2. Franchisee Financial performance
  3. Franchisee Engagement and Satisfaction
  4. Franchisor Training and Support
  5. Franchisor Financial performance
  6. Lender relations
  7. Compliance and Assurance

Independent rating systems are nothing new, even in franchising.  However, they are new to Australian franchising, and arguably long overdue.  Specific franchise rating systems are widely used in the US.

FRANdata’s US CEO, Darrell Johnson, said “In the US FRANdata has been providing ratings systems and services for 30 years. There are two keys to successful ratings systems – the assessment must be conducted independently, and the assessment must be objectively based on factors relevant to the decision of the prospective franchisee and others (such as financiers) involved in the transaction. The Australian franchise ratings system will bring both”.

The ratings system will be quickly embraced by quality franchise systems seeking opportunities to objectively differentiate themselves in a competitive market. Financiers, investors, prospective franchisees, regulators and even the media are likely to be attracted to the independence and objectivity of the new system.

FRANdata Australia is Australia’s leading franchise business intelligence and information advisory business.

For further information please contact:

Darryn McAuliffe – Telephone: 02 8346 6093, Email: [email protected]