AN INSIGHT OF THE CHARACTERISTICS OF MICRO-FRANCHISE BUSINESSES OPERATING IN SOUTH AFRICA

Abstract

Microfranchising is one of the new innovative business concepts that has gained traction in the past few years, and which could provide a solution to the challenges faced by micro- entrepreneurs and stimulate the growth of entrepreneurship. Microfranchising has therefore, emerged as a potential strategy meant to rapidly scale-up entrepreneurship behaviour within the Bottom of the Pyramid (BoP). However, despite microfranchising being singled out as a panacea for economic growth globally, very little is known about the microfranchising business concept in South Africa. Resultantly, the latter is ignored from entrepreneurship discussion and discourse at both academic and policy levels. To address this gap, the study assessed microfranchising practices in South Africa, to profile the characteristics of microfranchise businesses in South Africa. The study used the interpretivism research paradigm to achieve the study objectives. Primary and secondary data were employed to collect data on the microfranchising practices in South Africa. Five in-depth interviews were successfully conducted with microfranchisees, while secondary data (microfranchisees’ and microfranchisors’ success stories) was employed to collect data on the former and current practices of microfranchising in South Africa. The collected data was analysed using the ATLAS.ti. The study results show that the microfranchise business exhibits traits of BoP markets, centralised inventory buying, comprehensive training of microfranchisees, decentralised inventory buying, job creation, master microfranchisee, sales orientation, self-reliance of the business, standardisation and adaptation.