Automotive Products & Services Make Up 7% Of The Franchise Pie

This sector spans a wide array of products and services with many manufacturers securing distribution of their products through franchised fitment and/or retail facilities including auto mechanics, auto body repair, glass repair, battery and tyre replacement, cleaning and valet services and vehicle sales and maintenance. The recession over the past years has meant that this sector has done well as drivers are keeping their vehicles longer and need aftermarket products and services to keep their cars in optimum condition and running well.

A long pedigree in franchising

FASA’s records show that in the 1970’s franchising started to expand into other sectors – one of which was the automotive aftermarket – with brands such as Exhaust Shop, Mr X-Haust/Mr Tyre, Supa Quick and Silverton Radiator Services being some of the first to franchise. The 1980’s saw even further growth with important brands going the franchise route. They included Aftermarket Solutions which was founded in 1954 primarily to operate in the replacement automotive industry, franchised a number of their brands in the 1980s including ADCO, Midas, Motolek, Adco and CBS. The first Battery centre opened in Bloemfontein in 1969 with franchise stores rolling out from 1983 as a division of Raylite Batteries. Fasfit, Supa Quick and Kwikfit were other prominent brands.

Pandemic spawns innovation

Until the pandemic struck at the beginning of 2020, the Automotive Sector was set to be the one business area that would be impacted the most long-term by the 4^th Industrial Revolution. At the forefront of that change is the fuel retail sector that comprises franchised fuel stations and their retail operations and by extension automotive products and services.

The Automotive sector as a whole is not only a vital employment sector and contributor to the fiscus contributing roughly 40% of the total economic activity and employment, but is a significant enabler of, and support to many other sectors across the economic spectrum. Vehicle safety and effective vehicle repairs and maintenance of not only essential services but of all persons and businesses was a key area during the pandemic and continues to play a key role to the much-needed and speedy recovery of the economy.

Options in car sales

An upside over the past two years has been the soaring sales of used cars driven by consumers looking for more affordable options in the market, counter-acted by the global supply chain disruptions, shortage of parts and computer chips resulting in a shortage of new vehicles. The car buying journey also moved online during the pandemic with companies introducing the latest technologies to allow them to source prospective pre-owned vehicles in the market, transact digitally resulting in a seamless, transparent and safe process. Franchises like InspectaCar and the Motus Group agree that this move to digital has resulted in revealing the true condition of a pre-owned vehicles and making the consumer’s decision less demanding through live video streaming and an interactive vehicle inspection report.

While the car buying journey may have moved partially online, customers are looking, now more than ever, for professional knowledge and expertise in their interactions in all areas of the Automotive sector – whether it’s benefiting from the technological changes brought on by Covid-19 in the buying and selling of cars to the reliability and efficiency of the after sales market to looking forward to the future 4IR changes in the fuel retailing sector which will herald in a new era of aftermarket autocare.