Franchise business in the UK contributed over £11bn to the country’s economy last year – an increase of £400m from last year, according to the latest findings from the annual NatWest and British Franchise Association (bfa) survey.

The survey also revealed that compared to the ‘90s recession fewer franchise businesses today are trading at a loss. In 1990 only 70% of all franchise businesses were profitable compared to 89% in 2009.

2009 was a year where more businesses took up franchising as a business model, with the total number of franchise systems operating in the UK reaching 842, signalling a modest growth from the figure of 835 quoted last year.

Franchisors' confidence for the future of their business also grew with 94% optimistic about business conditions, compared to only 82% last year. Franchisors and franchisees are hopeful about the potential for growth with franchisors on average planning for an additional eight franchisee outlets.

Encouragingly, start-up costs have declined slightly and new entrants can expect to pay £46,700 in franchise fees and other associated costs to their franchisor, a decline from the figure of £50,000 which was quoted last year.

"Franchised businesses have weathered the recessional storm extremely well, which we should not be surprised about if we look at how franchising has proven itself over the years,” said Brian Smart, director general of the bfa.

“The combination of the wider business support, training and economies of scale, with the determination, enterprising nature and local business focus makes franchise businesses a very robust offering.”