Is franchising growing in Australia? What the data actually shows

• Franchisees: down about 5.2% from 2014 to 2023, against about 28% growth in all businesses. The 2014 count comes from Griffith's survey and the 2023 count from the Register, so the methods differ.
• Systems: estimates stayed between 1,144 and 1,160 from 2014 to 2023.
• Industry value added: IBISWorld's figures fell from $50,024 million in 2013-14 to $44,687 million in 2022-23.
• Revenue: IBISWorld estimates $179.5 billion in 2025-26, up 2.0% on the year but down 2.1% a year on average over five years.
• The review's first finding was that the size of the sector has not kept pace with growth in the broader business population.

Growth depends on what you measure. These are the measures with public figures, from the most direct to the least.

1. Number of franchisees: 74,598 in 2014 and 70,735 in 2023, a fall of about 5.2%. Treasury calculated the 2014 figure from Griffith's 2014 survey and took the 2023 figure from the Register, so treat the change as indicative.
2. Number of systems: 1,160 in 2014 and 1,120 in 2016 (both Griffith), then 1,144 in 2023 (ABS analysis). Different methods again, but no sign of strong growth.
3. Number of units: Griffith recorded growth from 43,800 units in 1998 to 79,000 in 2016, but no net change between 2014 and 2016. Later outlet figures, such as the FCA's 94,000-plus, use different methods, so they can't show a trend.
4. Industry value added, the sector's contribution to the economy: down from $50,024 million in 2013-14 to $44,687 million in 2022-23. IBISWorld's 2023 report forecast it to fall at an annualised 0.9%, against annualised GDP growth of 2.1%.
5. Revenue: IBISWorld estimates $179.5 billion for 2025-26, up 2.0% on the year, after an annualised fall of 2.1% over five years. The figure includes car and fuel retailing.
6. Businesses in IBISWorld's definition: 1,343 in 2026, growing 1.9% a year from 2021 to 2026.

• All businesses: the number of Australian businesses grew about 28% between 2014 and 2023, based on ABS counts cited by Treasury.
• Latest ABS count: 2,814,778 actively trading businesses at 30 June 2026, with 460,461 entries and 375,331 exits in 2025-26. These counts don't identify franchises.
• Share of small business: Griffith estimated franchise units at about 4% of Australia's small businesses in 2016.
• The last ABS measure: in 2009-10, 4.7% of businesses were franchisees and 0.4% were franchisors. That measure isn't part of current ABS releases.
• Contribution to the economy: with value added forecast to fall while GDP grows, the review said the industry is projected to 'significantly underperform the wider economy'.

The review did not measure causes, but it listed trends reshaping the sector. Treat these as its assessment, not proven reasons.

• Gig economy platforms offer flexible, low-cost supported self-employment to people who might otherwise have considered franchising.
• Direct-to-consumer models let manufacturers and service providers deal with customers directly, disrupting traditional retail and service franchise models.
• Agency models give operators a brand with more autonomy than a franchise, as a middle ground between franchising and running an independent business.
• Brands in shopping centres face high rents and complex leases, and a shift to online sales may raise issues with franchisees' territory exclusivity.
• Technology such as online marketing, data analytics and artificial intelligence may challenge some existing brands while helping others run more efficiently.
• Consumer demand is shifting towards sustainable and health-conscious products and services, which the review saw as an opportunity for some franchises.

• Between Griffith's 2014 and 2016 surveys, of 1,214 brands on its database, 48 were no longer operating and 61 were no longer franchising: about 9% combined. Another 4 had stopped offering new agreements and 12 turned out not to be franchises.
• FRANdata validated about 900 brands in 2015, rather than the 1,100 often quoted, and reported an 11% unit turnover rate (18% for food concepts). The public summary doesn't define 'turnover' and discusses transfers alongside other exits, so it is not a closure rate.
• Griffith described the fall from 1,160 to 1,120 systems as expected consolidation, with the remaining systems growing internally.
• In 2023 the ABS could not yet measure entry and exit rates from Register data, which had only been available for about a year.
• If a brand you join stops franchising, support, supply and your agreement can all be affected, so check the franchisor as closely as the franchise.

1. Ignore 'booming industry' claims. Sector totals say nothing about the system you are considering.
2. Check the system's own trend: outlet counts on its Register profile and in item 6 of the disclosure document across the last three financial years.
3. Compare openings with exits: count transfers, closures, terminations, non-renewals and buy-backs against new outlets.
4. Ask whether new outlets are genuinely new sites or resales of existing ones.
5. Find out where growth comes from: new franchisees, existing franchisees adding sites, or company-owned outlets.
6. Treat forecasts as opinions. Griffith's straight-line forecast was 1,344 brands by 2020; the ABS estimated 1,144 systems in 2023, although the methods differ.

• How many franchised and company-owned outlets did you have three years ago, and how many now?
• In each of the last three financial years, how many outlets were transferred, closed, terminated, not renewed or bought back?
• How many of last year's new franchisees took over an existing outlet rather than opening a new one?
• Which states do you operate in now, which do you plan to enter, and what support will new regions get?
• How have sales at established outlets changed over the last three years?
• Can I speak to franchisees who joined in the last two years, and to some who left?