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Journal articles on the topic 'Franchise Model'
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Fernández-Monroy, Margarita, Josefa D. Martín-Santana, and Inmaculada Galván-Sánchez. "Building successful franchise partnerships: the importance of communication and trust." Management Decision 56, no. 5 (May 14, 2018): 1051–64. http://dx.doi.org/10.1108/md-07-2016-0528.
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Purpose The purpose of this paper is to propose a conceptual model for building successful franchise partnerships. The model examines the influence of communication and trust on satisfaction and performance in franchise partnerships, considering that franchises are based on franchisor-franchisee and franchisor-supplier relationships. Design/methodology/approach The unit of analysis refers to the relationships that the franchisor maintains with the franchisees and the main supplier, from the franchisor’s perspective. A mail survey of 592 franchises was conducted by means of a structured, self-administered questionnaire for data collection. A total of 98 valid questionnaires were received and analyzed using structural equation modeling. Findings Results indicate that communication between franchise partners is related to satisfaction through trust. In fact, communication is a major precursor of trust. Findings also show the direct influence of trust on satisfaction in both relationships. Finally, results evidence that developing satisfactory relationships between partners improves strategic and operational franchise outcomes. Research limitations/implications The use of the questionnaire limits the approach to information gathering. In addition, the study focused on the franchisor’s perspective of the relationships and it would be interesting to include other partners’ opinions. Further, research should broaden the study scope to include other factors of franchise partnerships. Practical implications This study provides franchisors with guidelines to develop satisfactory relationships. It recommends that franchisors design adequate programs to create, maintain, and enhance franchise partnerships, and also to improve a trust-based culture. Originality/value The analysis is conducted taking into consideration the franchisor-franchisee relationship and the franchisor-supplier relationship. Measurement scales are developed and validated for both relationships.
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Balsarini, Peter, Claire Lambert, Maria M. Ryan, and Martin MacCarthy. "Subjective Knowledge, Perceived Risk, and Information Search when Purchasing a Franchise: A Comparative Exploration from Australia." Journal of Risk and Financial Management 14, no. 8 (July 21, 2021): 338. http://dx.doi.org/10.3390/jrfm14080338.
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Franchising has long been a method by which organizations seek to expand and facilitate local market development. However, franchising as a growth strategy can often be hampered by lack of suitable franchisees. To mitigate this shortage, some franchisors have engaged in recruiting franchisees internally from the ranks of their employees in addition to the traditional approach of recruiting franchisees externally. Predominantly franchisees are individuals rather than corporations and thus purchasing a franchise should most commonly be characterized as a consumer acquisition. To explore the relationship between subjective knowledge, perceived risk, and information search behaviors when purchasing a franchise qualitative interviews were conducted with franchisees from the restaurant industry. Half of these respondents were externally recruited having never worked for the franchisor and half were internally recruited having previously been employees of the franchisor. The external recruits expressed a strong desire to own their own business and engaged in extensive decision-making processes with significant information search when purchasing their franchises. Contrastingly, the internal recruits expressed a strong desire to be their own boss and engaged in limited, bordering on habitual decision-making processes with negligible information search when acquiring their franchises. The results reveal that differences in subjective knowledge and perceived risk appear to significantly impact the extent of information search between these two groups. A model of the relationship between subjective knowledge, perceived risk and information search in the purchasing of a franchise is developed that reconciles these findings. The findings also have practical implications for franchisors’ franchisee recruiting efforts which are integral to their capacity to develop local markets.
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Simin, Marina Jovićević, and Slobodan Živkucin. "ADVANTAGES OF FRANCHISE SYSTEM FOR DEVELOPMENT OF ENTREPRENEURSHIP." Knowledge International Journal 28, no. 1 (December 10, 2018): 177–81. http://dx.doi.org/10.35120/kij2801177j.
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Franchising is considered the most successful marketing concept around the world. Today, many franchises are offered, and it is incomparably easier and more secure to develop entrepreneurial spirit under the patronage of the already developed system. Franchise is called long term, firm contractual cooperation between independent companies or entrepreneurs, franchisor and franchisee, where the franchisor provides the franchisee with a set of knowledge and gives it its brand. The number of franchise systems in the world is rising, and competition compels the franchisee to search for new and attractive offers. The largest number of franchises exists on the United States market, the number of employees in this market is in arrears, and achieves the high GDP measured in billions of dollars. In the United States are represented all kinds of franchise systems, from the automotive industry, restaurants, education, beauty salons to new forms of work from home. Canada is the second largest in franchising, many forms have been developed that place the franchise at the very top of economic business. In Europe, the less developed countries, such as Poland, the Czech Republic, Hungary, Bulgaria, etc., are developing more and more domestic brands and striving towards the conquest of international markets. New models of franchised business such as home-based franchises are being developed to allow most people to work from home. The application of the franchise system in our country would significantly contribute to the development of the domestic market. The future success of franchising in Serbia depends on the ability to innovate, improve the size of the site, provide education to interested small and medium-sized enterprises and entrepreneurs. Looking at all these countries and different markets, one can conclude that franchising is less developed in weaker economies, while economically more developed markets achieve even greater expansion in the form of GDP, employment, education, institutions. If each country awakens awareness of the value of franchising as a good technique for enterprises and entrepreneurs, it will open the possibility of expansion franchising to international markets, through marketing, social networks and the Internet. What is important is that this type of franchising is developing in our country and in this way it is slowly focusing on international markets. In franchising, the risk of business failure when starting a business is significantly lower than when starting a stand-alone business. Franchising is a way to use a proven, more successful, business model in a personal business, thereby reducing the likelihood of failure. The franchisee still continues to act substantially with his own resources, at his own risk, but under a different name. A well-known and famous brand is an additional guarantee for greater recognition and an automatically higher number of consumers. Franchising is a shortcut to a more successful business success. In the future, banks are expected to pay more attention to the financing of franchising, as both franchisees and recipients are referred to banks that receive the role of checkpoints and mediators.
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Grace, Anthony Richard, Lorelle Frazer, Scott K. Weaven, and Rajiv P. Dant. "Building franchisee trust in their franchisor: insights from the franchise sector." Qualitative Market Research: An International Journal 19, no. 1 (January 11, 2016): 65–83. http://dx.doi.org/10.1108/qmr-09-2014-0085.
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Purpose – The purpose of this research is to identify the critical determinants of a franchisee’s trust in their franchisor. Design/methodology/approach – A qualitative approach was used, and 30 interviews were conducted with franchising participants. The first phase of the research consisted of exploratory interviews with franchising experts (franchise lawyers, accountants, consultants, mediators and bankers), and the second phase consisted of semi-structured interviews with franchisees and franchisors across two franchise systems. Findings – The research revealed five critical determinants of a franchisee’s trust in their franchisor: franchisee’s engagement in the system, franchisee’s confidence in the system, franchisee’s perception of a strong team culture, franchisee’s perception of franchisor competence and franchisee’s perception of franchisor character. Practical implications – The research provides insight into how the aforementioned components can be developed within a franchise system to build franchisee trust. The paper also concludes with four practical recommendations that can be integrated within a franchise system to increase levels of franchisee trust. Originality/value – This research builds on prior research into franchisee trust, providing an original contribution to the literature through the development of a practical model, showcasing critical determinants of a franchisee’s trust in their franchisor.
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Araújo, Davi Lucas Arruda de, Silvio Popadiuk, and Rafael Morais Pereira. "Barriers to knowledge transfer of the franchisor to franchisee: an application in language schools." Journal of Workplace Learning 32, no. 5 (April 25, 2020): 317–34. http://dx.doi.org/10.1108/jwl-09-2019-0110.
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Purpose This study aims to measure the influence of the barriers present in the knowledge transfer at the sales process, by the franchisor to the franchisee, in language schools in the São Paulo/SP city, Brazil. The theoretical aspects include the transfer of knowledge displayed through communication model and barriers inherent in this process. Using (Szulanski 1996) approach the barriers may occur in relation to, namely, the content of knowledge; context; the source; the recipient. Design/methodology/approach The methodology is quantitative and the type of research is exploratory and descriptive. For this investigation was used an adapted version of the questionnaire developed by Szulanski (1996), applied to a sample of 79 franchised language schools linked to the Brazilian Franchise Association. Beyond factor analysis it was used the nonparametric test of Jonckheere-Terpstra and analysis of variance, to comparing schools. Findings The results of this analysis revealed that certain types of knowledge transfers are evaluated by the franchisees as more favorably or unfavorably according to the brand franchise. These results show a lack of standardization trend of the activities of the sales process and mismatches with the guidelines of the franchisor. The authors highlight that in the comparison between the brands is evident the dominance of the CNA in relation to other networks of language franchises when analyzed the relationship factors, technical adequacy, absorption of knowledge, competence to absorb knowledge and in the indicators contribution to revenue, acceptance of guidelines and bring results. Originality/value This research contributes to the identification of barriers that are involved during the transfer of practices of the franchisor to the franchisee on the knowledge of the sales process in language schools, awakening in franchisee reflections of improvements and solutions that can be worked on and developed in their units. Specifically, the study contributes to the knowledge management literature in franchises, as this topic is still emerging, as it presents conflicting findings.
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PHAN, PHILLIP H., JOHN E. BUTLER, and SOO HOON LEE. "LEARNING: KEY TO LEVERAGING THE VALUE OF A FRANCHISE." Journal of Enterprising Culture 01, no. 03n04 (January 1994): 367–82. http://dx.doi.org/10.1142/s0218495894000057.
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The organizational learning dynamics inherent in the franchise relationship provide the primary focus for this research. By encoding knowledge of the skills needed to suceed within the contractual arrangement, the franchisor can short cut the learning process for the franchisee. Once the franchising arrangement is established, both franchisees and franchisors have vested interest in maintaining high levels of organizational learning. In this research a model is presented that incorporates these learning dynamics, and relates them to entrepreneurial returns. Using a sample of heavy-duty truck franchisees, the relationship between different types of organizational learning and performance are explored. The results indicate that the franchising contract may actually act to limit the returns to the franchise relationship. Instead, it may encourage the franchisee to direct their learning efforts to skew returns in their favor. Successful franchisees were found to systematically value the franchise contractual and non-contractual information content more than less successful franchisees.
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Prihandono, Dorojatun, Andhi Wijayanto, and Dwi Cahyaningdyah. "Franchise business sustainability model: Role of conflict risk management in Indonesian franchise businesses." Problems and Perspectives in Management 19, no. 3 (September 21, 2021): 383–95. http://dx.doi.org/10.21511/ppm.19(3).2021.31.
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Franchising is one of the most trustworthy strategic alliance formations to start or expand businesses. Like many other business formations, franchise businesses need sustainable and long-term running; these objectives can be reached by a proper relationship between partners – the franchisor and the franchisee – in the alliances. Both partners’ perspectives are valuable inputs to provide insight into understanding the sustainability of Indonesian franchise businesses. Furthermore, in any type of strategic alliances conflict is a risk that needs to be managed properly. This study aims to examine the relationships of determinants that influence franchise business sustainability. The determinants are risk management, trust, satisfaction, and sustainability. The study applies confirmatory factor analysis using structural equation modeling (SEM) AMOS software. Respondents in this study are franchisors and franchisees in the Indonesian retail and food and beverages (F&B) sectors, the study accommodates 204 respondents. Based on the analysis the study reveals that there is a positive relationship between risk management and satisfaction. Risk management also has a positive relationship with survivability; trust and satisfaction also have a positive relationship. Meanwhile, there is no relationship between satisfaction and survivability and the last relationship is between trust and survivability that has no positive relationship between the determinants. This study provides clearer insight to understand the relationships between determinants that influence franchise business survivability in Indonesia, especially based on both parties’ perspectives.
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Shaikh, Ateeque, Saswata Narayan Biswas, Vanita Yadav, and Debiprasad Mishra. "Measuring fairness in franchisor-franchisee relationship: a confirmatory approach." International Journal of Retail & Distribution Management 45, no. 2 (February 13, 2017): 158–76. http://dx.doi.org/10.1108/ijrdm-11-2015-0174.
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Purpose The purpose of this paper is to develop, test and validate a measure of fairness in the context of franchisor-franchisee relationship and test for the dimensionality of fairness. Design/methodology/approach The authors surveyed 300 franchisees of a large-scale franchisor in India. The authors employ confirmatory factor analysis (CFA) to analyse the data. Findings The authors tested four models of the fairness construct through CFA using structural equation modelling. The three-factor corrected model of the fairness construct exhibits comparatively better goodness of fit indices as compared to the other correlated models of the fairness construct. It clears the threshold level of validity and reliability test. The findings of the study suggest that the factor structure of fairness is three-factor correlated model with aspects of procedural fairness and informational fairness getting subsumed into one construct. Research limitations/implications Factor structure of fairness construct differs with earlier empirical research findings with both interpersonal fairness and informational fairness subsuming into each other to form one construct. Practical implications This measure can be utilized by franchisee managers to track perceptions of fairness among franchisees to manage the franchise relationship in a better way. Franchisees expect information sharing from the franchisor and not the representative of the franchisor. Originality/value To the best of the authors’ knowledge, this study is the first to develop a valid and reliable measure of fairness construct in the context of franchise relationship. This study also identifies factor structure of fairness construct.
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Chen, Ye-Sho, Chuanlan Liu, Qingfeng Zeng, and Renato F. L. Azevedo. "E-Business Strategy in Franchise Relationship Management." International Journal of Strategic Information Technology and Applications 3, no. 1 (January 2012): 54–65. http://dx.doi.org/10.4018/jsita.2012010104.
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Franchising as a global growth strategy, especially in emerging markets, is gaining its popularity. For example, the U.S. Commercial Service estimated that China, having over 2,600 brands with 200,000 franchised retail stores in over 80 sectors, is now the largest franchise market in the world. The popularity of franchising continues to increase, as people witness an emergence of a new e-business model, Netchising, which is the combination power of the Internet for global demand-and-supply processes and the international franchising arrangement for local responsiveness. The essence of franchising lies in managing the good relationship between the franchisor and the franchisee. This paper shows e-business strategy plays an important role in growing and nurturing such a good relationship. Specifically, the authors discuss: managing the franchisor/franchisee relationship, harnessing the e-business strategy, aligning the e-business strategy with application service providers, and an attention-based framework for franchisee training.
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Hudiarini, Sri, Galuh Kartiko, and Hudriyah Mundzir. "WARALABA MODEL BISNIS BARU YANG BERKELANJUTAN DITINJAU DARI ASPEK HUKUM." Jurnal Panorama Hukum 3, no. 1 (July 9, 2018): 59–72. http://dx.doi.org/10.21067/jph.v3i1.2432.
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Today the growth of the business world is growing so rapidly, it is also supported to expand the business which is more varied, including through franchise (Franchise). Which of these principles for some entrepreneurs is considered more effective, effective and profitable in the development of a business. In Indonesia, the regulation of franchises is based on agreements made by the parties on the basis of the applicable law, in this case the Government Regulation and the Minister of Trade Regulation. Franchise is a form of business that gets a lot of attention from business people, because it can be one way to increase economic activity and give opportunity to weak economic class to try, this means, Franchise can provide job opportunity, equality and also create field work for the community. In addition, the profits of this business are low cost and the materials already provided are also not too take place so vast, franchise recipients no longer need to bother developing their business by building a good and famous image. It is enough to ride on the famous fame of the franchisor, so franchisees who are generally small entrepreneurs will enjoy the success and luck of large-scale companies without having to carry out their own research and development, marketing and promotion that usually requires enormous expenses that the small businessman is unlikely to bear.
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S., Bardash. "CONTROL OF FRANCHISING IN THE TOURISM BUSINESS." Scientific Bulletin of Kherson State University. Series Economic Sciences, no. 41 (March 31, 2021): 17–21. http://dx.doi.org/10.32999/ksu2307-8030/2021-41-3.
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The turbulence of economic relations and instability of socio-economic development of national economies determine the search for optimal forms of small business development. One of the simplest and most profitable forms of such development is franchising. Franchising has become very common in the field of services, in particular, in the tourism business. At the same time, the principles and content of the application of the franchise business model in Ukraine differ from the global ones and do not contribute to the assessment of the effectiveness of its application. The objectives of the study are to determine the features of franchising and prove the need to establish a system of intra-network control of the franchisee. The methodological basis of the study consists of a dialectical method of knowing the essence of franchising, a comparative analysis of its advantages and disadvantages, an abstract logical method is used to justify the mandatory attributes of franchising, methods of synthesis and generalization is used to formulate research findings. The article identifies the features of franchising, as well as the advantages and disadvantages of using a franchise model of doing business in Ukraine. It is established that one of the reasons for the slowdown in the development of franchising in Ukraine is the imperfection of its regulatory framework, the application of which distorts the conceptual vision of the content and form of cooperation between the franchi-sor and the franchisee. It is determined that full and effective implementation of franchising is possible only on the basis of a fixed-term franchise agreement, permanent cooperation of franchisees throughout the term of the franchise agreement, compliance with settlement discipline; constant support of the franchisee by the franchisor in order to comply with established standards of activity, as well as the lack of competition between the subjects of franchising. It is also established that the minimization of transaction costs should be considered as one of the economic advantages of the tourism business under the franchise model. The identification of the attributes of franchising as a form of business partnership helped to determine the need to organize and monitor the quality of the franchisor's business operation, which is the subject of the franchise. Keywords: franchising, franchisor, franchisee, franchise tourism network, transaction costs, control of franchise business model. У статті ідентифіковано особливості франчайзингових відносин, а також переваги і недоліки застосування франчайзингової моделі ведення бізнесу в Україні. Установлено, що однією з причин уповільнення розвитку франчайзингу в Україні є недосконалість його нормативно-законодавчої бази, застосування якої спотворює концептуальне бачення змісту та форми співпраці франчайзера та франчайзі. Установлено обов’язкові атрибути франчайзингу як форми ділового партнерства та інструменту розвитку малого бізнесу. Установлено, що мінімізацію трансакційних витрат слід розглядати як одну з економічних переваг здійснення туристичного бізнесу за франчайзинговою моделлю. Ідентифікація атрибутів франчайзингу як форми ділового партнерства сприяла визначенню необхідності організації та проведення контролю франчайзера над якістю ведення бізнесу, що є предметом франшизи.Ключові слова: франчайзинг, франчайзер, франчайзі, франчайзингова туристична мережа, трансакційні витрати, контроль франчайзингової бізнес-моделі.
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King, Brian L. "Caught in the middle: franchise businesses and the social media wave." Journal of Business Strategy 37, no. 2 (April 18, 2016): 20–26. http://dx.doi.org/10.1108/jbs-04-2015-0037.
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Purpose The purpose of this paper is to explore the impact of the Internet, and more specifically social media, on franchise business models. Design/methodology/approach A review of both franchising and Internet literatures enables the creation of a simple model that distinguishes between surface waves, highly visible innovations that influence a restricted set of franchise business models, and deep waves that have a broader and more long-lasting influence on all franchises. Findings The first Internet era had a surface wave, online selling, that impacted relatively few franchises, but the deep wave of the wide availability of information and training materials has had a broader and more sustained impact on franchise systems. Similarly, Web 2.0’s social element has created a surface wave, the shared economy for hotels and cars, that affects relatively few franchises, but the deep wave of user-rating Web sites and Apps promises to have a broader and more long-lasting influence. Research limitations/implications This paper enables researchers identify potential research topics, highlighting the need to determine the impact of social media on how consumers perceive quality and the influence this has on their ongoing behavior. Practical implications This paper helps practitioners understand how the Internet influences the competitive balance between franchised and non-franchised businesses. Hence, it will be of interest to any large organization that offers high quality decentralized products or services, as they typically either franchise or compete with franchised businesses. As well, for entrepreneurs considering investing in a franchise, this paper will help identify which business models are more sustainable in the face of Internet innovation. Originality/value The surface wave/deep wave model is a new approach to analyzing the long-term impact of the Internet on all decentralized businesses.
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P. Krupskyi, Oleksandr, Nataliia Stukalo, Nataliya A. Krasnikova, and Yelina A. Falko. "Franchising model for expansion of the international travel business." Problems and Perspectives in Management 15, no. 4 (December 25, 2017): 230–42. http://dx.doi.org/10.21511/ppm.15(4-1).2017.07.
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The hotel sector of the travel industry is the leader according to the indicator of economic growth, which is observed in both developed and developing countries. Even under the economic instability and global natural disasters, the industry has seen growth in recent years. The franchising model for expanding activities is central to all successful hotel chains.The article deals with the franchising model for the travel business expansion and the economic performance of hotel chains such as Marriott International, Wyndham Hotels, and Hilton. They hold a prominent place in the global hotel business, have a steady tendency to expand their business, hold high positions in the ranking of the best franchises in the world and have been recognized by experts.The main risks for the franchisor and franchisee are determined when making a decision on the expansion of the international travel business, which must be taken into account when developing new markets for hotel chains. The main advantages of the franchising model of expansion, which promote understanding between the parties of the franchise agreement, dynamicize hotel chains expansion and allow for reducing their expenses and increasing incomes.It was found that the growth of net profit and total income in the indicated hotel chains was due to the increase in the number of rooms in franchising and the positive dynamics of franchise income. A more dynamic pace occurred after the crisis growth in revenues from the franchisee compared with the managerial model. A closer relationship between revenues and key financial indicators has been proved when using a franchising model.
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Alon, Ilan, Michèle Boulanger, Everlyne Misati, and Melih Madanoglu. "Are the parents to blame? Predicting franchisee failure." Competitiveness Review 25, no. 2 (March 16, 2015): 205–17. http://dx.doi.org/10.1108/cr-10-2014-0034.
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Purpose – The purpose of this study is to show how franchisor characteristics influence franchisee failure. To achieve this aim, we developed a heuristic model using the methodology and power of predictive analytics. Design/methodology/approach – The authors use data from the World Franchising Council’s and from the Small Business Administration (SBA). The data cover 271 diverse USA franchise chains that are present in both databases. Findings – The model predicts potential defaults of SBA-backed loans issued to American franchisees, and the authors identify 13 variables that help explain franchisee failure. Practical implications – The authors offer guidance for stakeholder groups – lenders, franchisors and franchisees – to minimize the risk of lending and business failure. Originality/value – The paper contributes to the franchising literature by considering parent firms’ characteristics to predict franchisee failure.
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Gaul, Christine. "What Makes a Franchisee Successful: Attitudes and Pre-requisites of Profitable Franchise Partners." International Business & Economics Research Journal (IBER) 14, no. 2 (March 2, 2015): 387. http://dx.doi.org/10.19030/iber.v14i2.9128.
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Franchising has gained popularity over the last decades. From a franchisor point of view, expanding a franchise network depends on several key aspects, one of which is the franchisee candidate recruitment and appropriate selection. This paper develops a theoretical franchisee selection model, which is based on an extensive international literature review and then discussed with 33 German-speaking franchise experts, in order to result in an improved and practically oriented model. The findings of this research are numerous and include the closely oriented opinion between academics around the world and interviewed franchise experts in Germany and Austria. Qualitative interviews give an insight in the many facets necessary to consider when evaluating a franchisee candidate. Nevertheless, the complexity of the topic limits the validity of the analysis made in this single paper.
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Weaven, Scott, Debra Grace, Rajiv Dant, and James R. Brown. "Value creation through knowledge management in franchising: a multi-level conceptual framework." Journal of Services Marketing 28, no. 2 (May 6, 2014): 97–104. http://dx.doi.org/10.1108/jsm-09-2013-0251.
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Purpose – The purpose of this paper is to present an integrative systems model of knowledge management (KM) across the franchisor-franchisee-customer triad. The conceptual development of this paper focuses on the areas of knowledge development, knowledge transfer and knowledge use within the context of dyadic monitoring, and key relational outcomes (partner congruence, relationship quality, perceived conflict, opportunism), and performance results (franchisor, franchisee and customer welfare). Design/methodology/approach – This paper critically reviews the relevant literatures in order to address three conceptual goals exemplified by the following research questions. How does knowledge development and organizational learning effectively facilitate knowledge transfer and knowledge usage in franchise systems? What role does monitoring play in the relationship between the knowledge management processes and the welfare of franchisors and franchisees? How does the process of knowledge management (development, synthesis, transfer, usage) influence franchisor, franchisee and customer welfare? Findings – An extensive review of the literature results in ten key research propositions being offered and these are graphically presented in the conceptual model in Figure 1. This model represents a multi-level perspective of KM which provides a solid platform for future empirical studies and further academic discussion. Originality/value – This paper makes two key contributions. First, through adopting an integrative KM perspective it draws attention to many (as yet) unanswered questions concerning the franchise relationship. Second, it re-positions KM research beyond consideration at a singular (firm, employee, supplier or customer) level by focusing on intra-firm and firm-customer linkages in the value creation process.
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Lee, Kyoung-Joo. "Knowledge sharing in franchise system: franchisee self-leadership, satisfaction, and compliance." International Journal of Contemporary Hospitality Management 29, no. 12 (December 11, 2017): 3101–18. http://dx.doi.org/10.1108/ijchm-03-2016-0178.
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Purpose The purpose of this paper is to deepen the understanding of the predictors and outcomes of knowledge sharing in a franchise system. An integrative framework is proposed to examine the influence of franchisee self-leadership on knowledge sharing and its subsequent influence on franchisee satisfaction and compliance. Design/methodology/approach On the basis of a survey of 111 franchisees of two leading bakery franchise brands in Korea, this study confirmed data validity and tested hypotheses by adopting partial least square–structural equation modeling. Findings Regarding the predictor of knowledge sharing, this research found that franchisee self-leadership has a positive effect on knowledge sharing. As outcomes, it found that active knowledge sharing has a positive effect on franchisee satisfaction and compliance. This study also shows that knowledge sharing mediates the relationship between self-leadership and franchisee satisfaction. Practical implications This research advises franchisors to actively develop programs and communication channels for knowledge sharing with franchisees to induce high levels of compliance and satisfaction. Furthermore, as selecting potential franchisees is key to the success of franchising, this research highlights the significance of self-leadership as a crucial personal trait of franchisees. Originality/value Despite the rapidly growing academic interest in franchise knowledge sharing, sparse theoretical approaches and empirical evidence are available. To address these limitations, this research presents an integrative model and empirical evidence.
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Zolfagharian, Mohammadali, and Iman Naderi. "Human resource management challenges facing franchise businesses." Personnel Review 49, no. 1 (November 1, 2019): 104–24. http://dx.doi.org/10.1108/pr-04-2018-0139.
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Purpose The purpose of this paper is to extend the current understanding of human resource management (HRM) challenges facing franchise businesses. Design/methodology/approach A qualitative investigation, including eight in-depth interviews and 66 semi-structured interviews with various franchise stakeholders as well as 42 participant observations, was conducted in North America to answer the research questions. Findings Six major conclusions emerged from the conceptual and empirical work. The findings, for instance, reveal that human resources in franchise businesses lacks in motivation and skills, and franchisees’ distance from the ideal mix of autonomy and risk-aversion determines psychological and financial distress in the system. Practical implications The findings suggest that when firms choose the franchising path as a means of leapfrogging resource constraints, they will experience new and more challenging HRM complications for several reasons. Therefore, decision-makers at both franchisor and franchisee firms need to address these new HRM challenges proactively by recognizing their possibility and emergence and by engaging in cooperative learning with one another. Originality/value While HRM practices can “make or break” franchise systems, some important research questions still remain unanswered in this context. In an attempt to narrow this gap, and using a qualitative approach, this work identifies and classifies the key HRM challenges facing the franchise industry. Based on the finding, a conceptual model is proposed and discussed.
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Brown, Richard S. "Franchise systems and lobbying: implications for Olsonian collective action theory." Management Decision 56, no. 11 (November 12, 2018): 2357–72. http://dx.doi.org/10.1108/md-11-2017-1080.
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Purpose Previous research combining corporate political activity and collective action theory has focused solely on industry structure and its role in predicting group lobbying or PAC participation. The purpose of this paper is to use a different context—franchise systems—to apply Olsonian collective action theory to political activities. Design/methodology/approach Using a random-effects technique in STATA on an unbalanced panel data set, this paper empirically models the effects of franchise system size and degree of franchising on the level of lobbying intensity. Findings Since franchise systems are made up of differing unit ownership structure, the author first model if those systems that are fully franchised lobby less than those with franchisor unit ownership (supported). Next, since collective action theory predicts that more participants in a space will lead to less collective action, the author predict that franchise systems with larger unit counts will lobby less than those with smaller counts (not supported). Finally, the author test the interaction of these two effects as systems that are fully franchised and of higher unit totals should have an even greater negative relationship with political activity (supported). Originality/value This paper uses both a novel data set and a novel context to study collective action. Previous research has utilized an industry structure context to model the level of lobbying and collective action, while the current research uses an analogous logic, but in the context of franchise systems.
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Kotliarov, Ivan. "The real price of intellectual property: evaluation of franchisees’ benefits." Acta Oeconomica 63, no. 1 (March 1, 2013): 43–60. http://dx.doi.org/10.1556/aoecon.63.2013.1.3.
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It is demonstrated that models of royalty rate calculations developed for licensing should not be applied to franchising because the benefits received by a licensee and a franchisee are different. It is proposed that the risk reduction generated by the franchisor’s effective technologies and the managerial support given to a franchisee also be included in the model of royalty calculation. It is demonstrated that a franchisee may wish to acquire the franchise even if the franchisor takes the full amount of additional income or if this additional income is negative.
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Ghantous, Nabil, and Shobha S. Das. "International franchising and performance: a resource-based perspective." International Journal of Retail & Distribution Management 46, no. 8 (August 13, 2018): 744–63. http://dx.doi.org/10.1108/ijrdm-10-2017-0244.
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Purpose The purpose of this paper is to investigate international franchise performance. It focuses on how franchisors conceive their international performance, the drivers of their international performance, and how age-at-entry moderates the impact of their resources and capabilities (R&C) on international performance. Design/methodology/approach Using the lens of the resource-based view of the firm, the authors build on franchisor voice from a qualitative study (n=28) to propose a research model of international franchise performance. A second, quantitative study (n=89) tests the model with PLS structural equation modeling. Findings Franchisors view international performance in terms of relationship satisfaction with foreign franchisees and performance in comparison to competitors. The empirical results show that relationship satisfaction significantly improves comparative performance. Both franchisor-owned resources, the brand and knowhow, enhance only comparative performance, while all three international relational capabilities, related to knowhow transfer, monitoring, and contract design, and both reconfigurational capabilities, related to organizational responsiveness and innovativeness, improve relationship satisfaction. Only contract design and innovativeness increase comparative performance. Finally, late internationalization reinforces franchisor ability to leverage relational and reconfigurational capabilities for better relationship satisfaction. Originality/value This paper contributes to research on international franchise performance. It uses a mixed-method design and offers the first quantitative investigation of the drivers of international franchise performance. This research also integrates the role of franchisor R&C with franchisor strategic choices, through the moderating effect of internationalization timing.
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Jang, SooCheong (Shawn), and Kwangmin Park. "A sustainable franchisor-franchisee relationship model: Toward the franchise win-win theory." International Journal of Hospitality Management 76 (January 2019): 13–24. http://dx.doi.org/10.1016/j.ijhm.2018.06.004.
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Park, Kunsoon, Seungwon “Shawn” Lee, and Mahmood A. Khan. "Exploring the impact of franchise support on franchisee acceptance of intranet in quick service restaurant (QSR) franchise system." Journal of Hospitality and Tourism Technology 5, no. 2 (August 12, 2014): 143–59. http://dx.doi.org/10.1108/jhtt-05-2013-0016.
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Purpose – The purpose of this paper is twofold: to investigate the impact of franchisor support on quick service restaurant (QSR) users’ intranet acceptance; and to examine the technology acceptance model (TAM) to explain QSR users’ attitude toward the franchise intranet usage. Franchisors are building intranet systems as a communication tool to assist their franchisees in performing their jobs better. However, there is a little available literature that discusses in detail the use of the intranet by franchise systems. Design/methodology/approach – This study adopted the TAM to investigate the acceptance of the intranet in the context of QSR franchise systems. The original TAM was modified to include an external variable, franchise support. A total of 161 returned and completed responses were examined. Descriptive analysis, validity, principal component factor analysis and regression analysis were used to estimate the relationships between constructs. Findings – The key finding of this study is that franchise support is a key in the decision for users to use intranet systems in the QSR franchise systems. This study also confirmed that there are positive and significant relationships among key variables: franchise support, perceived usefulness of intranet, perceived ease of use of intranet, attitude toward using intranet and behavioral intentions to use intranet. Regression analysis revealed that TAM is a valid model in predicting intranet adoption in restaurant franchise systems. Originality/value – This study pursued franchise support, which was not included in the original TAM, to see how it affects perceived ease of use, perceived usefulness and intention to use. In addition, a list of recommendations for improving the situation in that franchise organization is provided.
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Machackova, Vendula. "Perception of Creativity in International Franchising Business Concepts - Comparison Analysis Between Franchisees and Franchisors." Creative and Knowledge Society 2, no. 1 (July 1, 2012): 60–81. http://dx.doi.org/10.2478/v10212-011-0017-1.
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Perception of Creativity in International Franchising Business Concepts - Comparison Analysis Between Franchisees and FranchisorsThis paper deals with the topic of creativity and perceived freedom of creativity in international franchising business concepts. It analyses various areas of daily business operations and the franchising business concept as a whole. Its focus is aimed at comparing the perception of level of freedom given in these areas to franchisees by the franchisors and its objective is to find out where these perceptions differ between franchisees one side and franchisors on the other. The model of franchising is not described and the article assumes that the reader is familiar with this business model. The purpose of this article is to analyse and present the situation of creativity in the sector of international franchise businesses. As international franchising is in the focus of this article, topics such as cross-cultural environment in franchising models and creativity across cultures are covered. The method used to collect the data for further analysis is running an empirical research among two populations - franchisees and franchisors from several franchising business concepts active in international environment. Representatives from the two populations were asked to evaluate the level of freedom of creativity given or applied in their franchising business concepts. Respondents were answering an online survey, assessing ten different areas in daily business on a scale from one to five, ranging from no creativity allowed and strict governance by rules defined in the franchise concept to high level of creativity and freedom. Findings from both side of the franchise business partnerships, franchisees and franchisors, are presented including the test of homogeneity of proportions. Therefore some implications exist for further discussions and research, if franchising at all is, in its essence, a method of business concept, which enhances and facilitates creativity, or if creativity is perceived as a danger to franchise system that would harm its global unified approach which is the key principle of the franchis unified brand and concept strategy.
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Fakos, Alexandros, and Maria Merino. "Multinational franchise entry and institutional quality: evidence from Mexican cities." Management Research: Journal of the Iberoamerican Academy of Management 15, no. 3 (August 21, 2017): 313–37. http://dx.doi.org/10.1108/mrjiam-06-2017-0754.
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Purpose The purpose of this paper is to document the extensive heterogeneity in institutions within countries and investigate which institutional factors are the most relevant for international brands. Design/methodology/approach The paper analyzes the entry patterns of three global fast-food franchise networks in 78 Mexican cities using discrete outcome models and ordered probit in particular. To summarize the quantitative importance of the results, the analysis includes also log-linear regressions with Heckman correction for the city observations without franchise presence. Findings Institutional factors are critical for an international franchisor in the decision to enter a new market. The most important institutional quality proxy for franchise entry is the rate of formal employment. The more the informal employment in a city, the lower the number of franchised stores and the lower the probability of brand presence in the city. Research limitations/implications Only three fast-food franchises are included in the paper, which limits the generalization of the results beyond the sector and Mexico. Another limitation of the methodology of this paper is that the authors estimate the effect of institutions on multinational franchise entry conditioning on market size. The issue here is that if institutions increase gross domestic product (GDP) per capita, then the demand for multinational franchises also increases. Such an effect cannot be captured if we condition on market size in our econometric models. This is particularly important for policy-makers aiming to quantify costs and benefits of reforms but not an important consideration for practitioners who might take institutions as given and are mainly interested in entry strategies that maximize profitability. Practical implications Institutional variables, and not only market factors, are critical to understand the entry decision of global franchisors in Mexico. In particular, the extent of informality is relevant in explaining the store location. It is necessary to understand how managers value the quality of institutions and which dimensions are most important for multinationals. In addition, the analysis should be conducted both at the national and sub-national level, given that within-country heterogeneity is prevalent in emerging markets. Social implications Cities must reinforce and communicate their institutional quality to attract foreign investment by franchises in particular. Originality/value We test several dimensions of institutional quality at the urban level as determinants of multinationals? decision to enter a city in a foreign market. We use novel administrative data at the municipality level and we employ econometric model that takes into account the discreetness of entry data and the fact that there are cities with no franchise presence. We control for sample selection, which comes from the zero number of stores in some city observations in the regressions.
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Cordobés Madueño, Magdalena, and Pilar Solde. "Management Control in Inter-organizational Relationships: The Case of Franchises." Innovar 25, no. 58 (October 1, 2015): 23–36. http://dx.doi.org/10.15446/innovar.v25n58.52357.
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There is great interest in the role of management control on theoretical and practical developments within the field of Inter-organizational Relations. This research aims to contribute at verifying how relationships between firms affect the management control tools used, as illustrated in a specific case: the relationship between the franchisor and its franchisees, which has not received much attention to date. As indicated by previous research, case studies can be helpful to determine the factors affecting the type of management control tools that should be established to manage inter-firm relationships.Results have found that the franchisor uses quantitative control mechanisms in order to avoid common types of opportunistic franchise behavior related to royalty payments and other financial requirements, as well as qualitative tools to assure the fulfilment of agreement-related conditions regarding knowhow, to resolve unexpected non-economic problems and to encourage personal relationship and trust. This study also provides an outline on franchisor-franchisee relationships in the model proposed by Van der Meer-Kooistra and Vosselman (2000). To test this model, the franchisor's perspective (outsourcer) has been taken into account as performed when building the model. Findings indicate that this relationship shows many similarities to the pattern based on bureaucracy and a few similarities to patterns based on trust.
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SZMITKA, Stanisław. "THE IDEA OF FRANCHISE AS A MODERN CONCEPT OF ENTERPRISE MANAGEMENT: THE EXPERIENCE OF POLAND." JOURNAL OF EUROPEAN ECONOMY 19, Vol 19, No 2 (2020) (June 2020): 265–82. http://dx.doi.org/10.35774/jee2020.02.265.
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Over the years, the franchise has become an attractive model for the sale of products and services, as well as a means of developing the franchisor’s business. Franchising systems around the world have become very popular among franchisees, who receive an already proven cost-effective business model in exchange for payments, purchases and other services from the franchisor. These systems also bring intangible benefits in the form of encouraging the promotion of entrepreneurship in society. Polish franchise legislation has systematic nature and is based on the Civil Code, the Law on Industrial Property, the Law on Combating Unfair Competition, the Law on Protection of Competition and Consumer Rights, the Law on Copyright and Related Rights, European Code of Ethics for Franchising. Taking into account the legal regulations, the mechanism of the Polish model of franchising is revealed and the newest forms of its use in business activity are distinguished.
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Agrawal, Deepak, and Rajiv Lal. "Contractual Arrangements in Franchising: An Empirical Investigation." Journal of Marketing Research 32, no. 2 (May 1995): 213–21. http://dx.doi.org/10.1177/002224379503200208.
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The authors use primary data to empirically test several hypotheses about business format franchising on the basis of the theoretical model presented in Lal (1990). They find support for the hypothesis that royalty rate balances the incentives to the franchisor to invest in brand name with those to the franchisees to invest in retail service. Also consistent with the mixed strategy equilibrium, the authors find that royalty rate positively affects monitoring frequency, and that monitoring costs negatively affect service level. However, contrary to the theory, the authors find that monitoring costs inversely affect monitoring frequency among franchisors. They analytically extend Lal's model to incorporate heterogeneity in monitoring costs among franchisees belonging to the same franchisor and find strong empirical support for the hypothesis that monitoring costs inversely affect monitoring frequency within a franchise system.
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Ravens, Jan. "The franchise model." Tertiary Education and Management 1, no. 1 (March 1995): 81–90. http://dx.doi.org/10.1007/bf02354101.
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ALIAS, ADNAN. "DEVELOPING LOCAL FRANCHISE: STRATEGIC PERSPECTIVE AND MODEL." Journal of Enterprising Culture 01, no. 03n04 (January 1994): 437–48. http://dx.doi.org/10.1142/s0218495894000094.
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Franchising is a global phenomenon. In developing countries, franchising is activated both by international franchise entities and home-grown franchises. Rapid development of franchising coupled with turbulent environments have led the society to view franchising as more than just a form of business; franchising is a strategy. The Malaysian government has even looked beyond that by adopting franchising as a strategy to develop local entrepreneurship. A comprehensive model attesting to the role of the government in promoting franchising—both imported and home-grown—is presented.
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Levickaitė, Rasa, and Ramojus Reimeris. "FORMING A PERCEIVED FRANCHISE VALUE: THEORETICAL INSIGHTS / FRANŠIZĖS SUVOKIAMOS VERTĖS FORMAVIMAS: TEORINĖS ĮŽVALGOS." Business: Theory and Practice 12, no. 1 (March 10, 2011): 85–91. http://dx.doi.org/10.3846/btp.2011.09.
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The article is based on literature review, theoretical insights and deals with the topic of perceived franchise value. The objective of the paper is – what elements form the franchisee‘s perceived value in service business (comparing with alternative of own business model). The aim of the paper is to propose systematic value elements in the process of forming a value of a franchise business model perceived by the franchisee. In terms of practical meaning, this article should be relevant to entrepreneurs, company owners, and future entrepreneurs planning to set up their own business, but lacking the managerial experience. The scientific value of the paper is theoretical insights analyzing franchise, which has not been thoroughly analyzed in the Lithuanian academic society, and the formation of a perceived franchise value, which has not been analyzed at all. This is the second of three authors’ articles of franchise series.
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Xu, Jianjun, and Lanlan Cao. "Optimal in-store inventory policy for omnichannel retailers in franchising networks." International Journal of Retail & Distribution Management 47, no. 12 (December 9, 2019): 1251–65. http://dx.doi.org/10.1108/ijrdm-09-2018-0199.
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Purpose The purpose of this paper is to characterize the optimal ordering and allocation policy for a store replenishment decision in the context of an omnichannel retailer in a franchise network. The authors further show that a myopic policy is optimal, which circumvents the curse of dimensionality for the multi-period inventory model and help store managers optimize their decisions about the amount of inventory to stock for both online and offline demands and the percentage of inventory to reserve for online orders. Design/methodology/approach This research is trigged by several managerial studies which suggest reserving a certain percentage of the in-store inventory for online orders as a good store inventory allocation practice for omnichannel retailers in a franchise network. The authors used an analytical model to develop this practice by clarifying how store managers can decide on the amount of inventory to replenish and the percentage to reserve for online orders. Findings This study develops a finite horizon, periodic review inventory model to identify an optimal and dynamic replenishment and allocation policy. The analysis uncovers the system’s fundamental structural property concavity. The research shows that, due to this property, the optimal replenishment policy is a base-stock policy. The latter is due to the base stock level being independent of the initial inventory at hand, and the optimal allocation level being non-decreasing on the base-stock level. Research limitations/implications This study contributes to the literature on store inventory management for omnichannel retailers in a franchise network by investigating their optimal store inventory ordering and allocation policy. Nevertheless, the zero-lead time and zero-setup cost assumptions limit the findings. Practical implications Insights into an optimal store inventory policy may guide franchisee store managers to decide on the amount of inventory to replenish and the percentage to reserve for online orders. Originality/value The originality of this paper lies in its focus on in-store inventory management for omnichannel retailers in a franchise network. The findings are helpful for franchisor retailers to implement the omnichannel strategy at the level of in-store inventory management. Beyond using incentive systems, the franchisor should leverage legitimate powers by mentioning a relevant measure in their contracts with their franchisee to minimize their channel conflicts and ensure their customers have seamless shopping experiences.
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Zhukov, V. A., and A. D. Chudnovskii. "Formation of the hotel business model based on the network management form." Vestnik Universiteta, no. 3 (April 12, 2019): 54–60. http://dx.doi.org/10.26425/1816-4277-2019-3-54-60.
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The competitive advantages, acquired by hotels using the network form of business organization, have been highlighted. Based on the analysis of the diverse opinions of specialists, the concept of a «hotel chain» has been clarified. Тhe difference between the concepts of «hotel chain» and «hotel brand» has been shown. The features of the formation of hotel chains in Russia have been emphasized. A management contract and its components, that require agreement between the hotel operator and the owner of an independent hotel, have been considered. The prospectivity for an independent hotel to conclude with a hotel operator of a franchise agreement with a view to joining the network has been shown. The data on the amount of franchisee contributions to franchisor from various hotel operators for certain hotel brands in 2018 have been presented.
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Weaven, Scott K., Debra A. Grace, Lorelle Frazer, and Jeffery Giddings. "PROCESSUAL ANTECEDENTS OF PERCEIVED CHANNEL CONFLICT IN FRANCHISING." Journal of Business Economics and Management 15, no. 2 (April 29, 2014): 316–34. http://dx.doi.org/10.3846/16111699.2012.711362.
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In this study, we develop and examine the network of relationships explaining perceived conflict in franchise relationships from a franchisee perspective. Our research contributes to the current knowledge of asymmetric exchange relationships through demonstrating the importance of a franchisee's expectations confirmation, relational trust and relationship satisfaction in franchisee assessments of network conflict. The goal of this paper is to empirically examine (1) the relationship between franchisee perceptions of information quality (information dissemination and information search) and the confirmation of franchisee performance expectations, (2) franchisee characterizations of their relationships with their franchisors in terms of relational sentiments such as trust and relational satisfaction, communication and conflict management, (3) the relationship between franchisee satisfaction and perceived conflict, and (4) the moderating effect of franchisee experience on the relationship between franchisee satisfaction and franchisee perceptions of conflict. Empirical results, utilizing a sample of 345 franchisees in Australia, present strong evidence for the support of nine of the ten hypotheses drawn from the conceptual model. Specifically, data reveal that in an effort to cultivate a network of cooperative and satisfied franchisees, franchisors should adopt strategies that promote the timely dissemination of relevant and meaningful pre- and post-entry information, open communication exchange, transparent conflict management systems and personalized support in accommodating individual franchisee needs.
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Giudici, Alessandro, James G. Combs, Benedetto Lorenzo Cannatelli, and Brett R. Smith. "Successful Scaling in Social Franchising: The Case of Impact Hub." Entrepreneurship Theory and Practice 44, no. 2 (October 1, 2018): 288–314. http://dx.doi.org/10.1177/1042258718801593.
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Social entrepreneurs increasingly use franchising to scale social value. Tracey and Jarvis described how social franchising is like commercially-oriented franchising, but noted critical challenges arising from dual goals. We investigate a social franchisor that overcame these challenges and describe how the social mission became the source of business model innovation. We show that the social mission fostered a shared identity that guided the search for adaptations to the franchise model. The shared mission-driven identity created pressure toward (1) decentralized decision-making, (2) shared governance, and (3) a role for the franchisor as orchestrator of collaborative knowledge sharing among franchisees. Findings should help social franchisors avoid common pitfalls and suggest future research questions for social entrepreneurship and franchising scholars.
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AGUIAR, HELDER DE SOUZA, SERGI PAULI, ABRAHAM SIN OIH YU, and PAULO TROMBONI DE SOUZA NASCIMENTO. "MODELING THE NEW FRANCHISE CREATION DECISION: THE RELEVANCE OF BEHAVIORAL REASONS." RAM. Revista de Administração Mackenzie 17, no. 5 (October 2016): 110–37. http://dx.doi.org/10.1590/1678-69712016/administracao.v17n5p110-137.
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ABSTRACT Purpose: Franchising is one of the fastest-growing operating modes in Brazil. In 2014, the Brazilian Franchising Association reported 2,492 active brands in the country. Some theories with an economic point of view, such as the agency theory, plural forms theory, or scarcity principle, explain why companies choose franchising. However, did the decision makers and founders of these franchises decide on this strategy taking only economic reasons into consideration? The purpose of this study is to understand the a priori criteria (prior to the decision) that executives took into account when adopting this strategy and the key motivations for this decision. Originality/gap/relevance/implications: The literature emphasizes the economic reasons for the success of the franchise model, but it does not focus on the founders' motivations when they choose this strategy. This is the gap that this study seeks to address. Dissonance could arise between economic reasons and entry motivations that could result in consequences for the management of new franchises. Key methodological aspects: Ten companies of different industries and different life cycle stages involved with the franchise model were scrutinized using a semi-structured questionnaire based on the literature on decision theory and franchising. Summary of key results: Behavioral factors significantly influence decision makers when choosing the franchise model. Key considerations/conclusions: This study distinguishes the economic reasons from the executives' motivations when choosing the franchise model and highlights the importance of non-economic factors in this decision.
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Chyzmar, Ivan, and Volodymyr Hoblyk. "E-sports organizations with franchised networks: formalization of technological and economic development based on optimal operation and upgrade of the hardware." Economic Annals-ХХI 187, no. 1-2 (February 28, 2021): 146–62. http://dx.doi.org/10.21003/ea.v187-15.
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The paper focuses on the priority given to the technological and economic development of e-sports organizations with franchised networks. Attention is paid to the specificity of the process of timely upgrading of e-sports hardware, which involves the upgrading and introduction of new, more sophisticated and advanced gaming and other devices, which determines the number of e-sports disciplines and available e-sports events for the е-sports arena. The success of franchising networks depends on the quantity of the c-sports hardware, which should be similar to the hardware used by the main arena in order to ensure the functionality of a well-structured state-of-the-art training process for e-sport athletes. The purpose of the study is to present a basis for the technological and economic development of e-sports organizations with a franchising network within the formalized system in terms of finding optimal solutions to the problem of hardware upgrades. The study presents a model of technological and economic development of all e-sports organizations with franchised networks as а content area, posing the rules of operation, regulating the process of hardware upgrades and focusing on the sustainability of development. Dynamic programming methods based on Bellman’s equations and the formalization of the problem of hardware replacement through graphic notations, cloud computing in the AnyLogic environment are used to identify and illustrate the features of such solutions. The result of the research is a description of technological development of e-sports organizations with a franchise network with the use of a model that approximates the optimal way of operation and upgrade of related hardware. This development illustrates the optimal way of operation and hardware upgrade of Blizzard Arena and Overwatch League, represented by participants from the United States, the United Kingdom, Germany, France, South Korea and Ukraine. The franchised Overwatch League includes the main arena (Blizzard Arena), as well as Florida Mayhem Club (Miami-Orlando, USA), New York Excelsior Club (New York, USA), London Spitfire Club (London, UK), Vault Club 15 (Kyiv, Ukraine), Immortals Club (Los Angeles, USA), NRG E-sports Club (Berlin, Germany), Misfits Club (Seoul, South Korea), PS4 Training Base (Beijing, China) and Xbox One Training Base (Paris, France). According to the obtained data, the formalization of the technological and economic development of Blizzard Arena suggests a solution to the problem of finding an optimal strategy relevant to optimization of hardware up to the moment of its transfer to the franchised network. Such formalization is highly relevant. They rely on the possible state of the system proposed in our research. That system state identifies the functional Bellman equations. Naturally, emerges a possibility to significantly reduce investment in the e-sports environment of the main arena and the franchise while controlling the quality and functionality of e-sports hardware. The organizations’ focus on two-stage upgrades will reduce investment in major hardware. The study illustrates the formalization of the techno-economic development of the Blizzard Arena through a two-stage upgrade of the Aerocool Advanced Technologies franchise (primary franchise - from producer, secondary franchise - from franchise Blizzard Arena operator). Based on the specific features of the Bellman equations, the development of the Blizzard Arena must take into account the model which determines the feasibility of hardware transferring to a franchised network during the third period of operation, where it operated as long as franchisees enter the maximum profit area. When using the Bellman equations, we suggest that the arena focus on the moment when the function values will correspond to the replacement state of the hardware and the franchise member on the stability of the environment. The formalization of the technical development will make it possible to orient the e-sport organizations with franchised networks to search for conditions sufficient for optimal operation and upgrade of their hardware. As a result, there will appear an optimized system with a content area, which will provide a stable environment for e-sports events at the arena and athletes’ training in franchise clubs.
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Jell-Ojobor, Maria, and Josef Windsperger. "Determinants of the governance structure of the international franchise firm." International Marketing Review 34, no. 6 (November 13, 2017): 814–84. http://dx.doi.org/10.1108/imr-10-2015-0208.
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Purpose The governance structure of international franchise firms varies from higher control modes, such as wholly owned subsidiaries and joint venture franchising, to lower control modes, such as area development and master franchising. Based on organizational economics, strategic management, and international business perspectives, the purpose of this paper is to use the case study analysis to empirically evaluate an integrative model on the franchisor’s choice of international governance modes. Design/methodology/approach The study applies qualitative methods, such as in-depth case analysis, to investigate a large set of variables that influence the governance structure decision of the international franchise firm. Specifically, it applies a theory-testing case study with two major competitors in the European automotive rental industry, i.e. Europcar and Sixt. Theory-testing case research is justified by the lack of explanatory research due to the complexity of the franchisor-franchisee relationship phenomena, such as the factors that influence the franchisor’s choice of international governance modes. The investigation of the complex governance structure phenomenon requires a holistic analysis. Findings The case study shows that environmental, behavioral, transaction-specific, resource-based (system-specific, market-specific, financial resources), and international strategy considerations are important determinants of the governance mode decision of the international franchise firm. Research limitations/implications The study responds to the recent call in organizational economics, marketing, strategic management, and international business literature to develop and test a multi-theoretical framework to explain the governance structure of inter-organizational networks, such as franchise networks. Originality/value Few previous studies in international franchising have used more than one theoretical perspective to explain the governance structure of the international franchise firm. This study contributes to the theory-testing case study literature by applying a rigorous method of conducting case research. This includes developing a theoretical framework and a systematic research design. A systematic research design requires a holistic analysis by investigating the international franchise governance modes from a variety of theoretical perspectives which are the organizational economics, strategic management, and the strategy-structure perspective.
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Piot-Lepetit, Isabelle, Rozenn Perrigot, and Gérard Cliquet. "Organizational form and efficiency of franchise chains." International Journal of Retail & Distribution Management 42, no. 7 (July 8, 2014): 671–84. http://dx.doi.org/10.1108/ijrdm-04-2013-0089.
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Purpose – The purpose of this paper is to develop a new model allowing the implementation of a benchmarking process that jointly measure the efficiency of franchise chains and determine their optimal organizational form. Design/methodology/approach – The methodology is based on a non-econometric technique developed by management scientists on economic concepts for evaluating the performance of decision-making units and implementing a benchmarking process. An extended model is developed in the paper for evaluating the efficiency and determining the optimal percentage of company-owned outlets (PCO) of each franchise chain. Findings – First, results showed that the PCO has a positive impact on franchise chain efficiency; even if other chain characteristics have a larger impact. Second, the optimization of the PCO allows for additional improvements in efficiency. Research limitations/implications – Even though this study has some limitations (e.g. sample and variable selection), it contributes to the literature on franchising by providing an approach allowing us to answer to the question of Shane (1998) on the optimal proportion of franchised units given other firm characteristics. Practical implications – By developing a model that allows for the joint evaluation of franchise chain efficiency and optimal PCO, this study offers to franchisors a new benchmarking process allowing for both a competitive and functional benchmarking. Originality/value – The originality of this research can be found in the new model developed for allowing a benchmarking of franchise chains that allows an evaluation of efficiency jointly with a determination of their optimal organizational form.
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Mills, Colleen E., and Faith Jeremiah. "Franchising microbusinesses: coupling identity undoing and boundary objects." International Journal of Entrepreneurial Behavior & Research 27, no. 1 (October 22, 2020): 231–50. http://dx.doi.org/10.1108/ijebr-09-2019-0545.
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PurposeThis study presents an original empirically based conceptual framework representing mobile microbusiness founders' experiences when converting to a franchise business model that links individual-level variables to a sociomaterial process.Design/methodology/approachAn exploratory interpretive research design produced this framework using data from the enterprise development narratives of mobile franchisors who had recently converted their mobile microbusinesses to a franchise business model.FindingsThe emergent framework proposes that franchisor’s conversion experience involves substantial identity work prompted by an identity dilemma originating in a conflict between role expectations and franchising operational demands. This dilemma materializes during franchise document creation and requires some degree of “identity undoing” to ensure business continuity. By acting as boundary-objects-in-use in the conversion process, the franchise documents provide a sociomaterial foundation for the business transition and the development of a viable franchisor identity.Research limitations/implicationsThere is scant literature addressing the startup experiences of mobile microbusiness franchisors. The study was therefore exploratory, producing a substantive conceptual framework that will require further confirmatory studies.Practical implicationsBy proposing that conversion to a franchise business model is experienced as an identity transformation coupled to a sociomaterial process centred on system documentation, this original empirically based conceptual framework not only addresses a gap in the individual-level literature on franchise development but also provides a framework to direct new research and discussions between intending franchisors and their professional advisors about person–enterprise fit.Originality/valueThe conceptual framework is the first to address franchisors' experience of transitioning any type of microbusiness to a franchise business model.
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Hajdini, Ilir, and Josef Windsperger. "Real options in franchise contracting: an application of transaction cost and real options theory." European Journal of Law and Economics 50, no. 2 (August 6, 2020): 313–37. http://dx.doi.org/10.1007/s10657-020-09665-3.
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Abstract Previous research has not explained the use of real option clause in franchise contracting. The real option clause has two economic functions: To reduce transaction costs by mitigating opportunism risk and to increase strategic rents by exploiting the profit potential from future upside opportunities under uncertainty. We argue that franchisors will more likely use a real option clause (ROC) in franchise contracts under high behavioral uncertainty, high franchisors’ transaction-specific investments relative to franchisees’ and long contract duration. In addition, by combining transaction cost theory and real option theory, our study provides a new explanation for the impact of environmental uncertainty on the use of ROC in franchise networks by showing that there exists a U-shaped relationship between environmental uncertainty and the franchisor’s use of ROC. Overall, the data from German and Swiss franchise systems provide support of the research model.
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Silkoset, Ragnhild, Arne Nygaard, and Roland E. Kidwell. "Differential effects of plural ownership and governance mechanisms in limiting shirkers and free riders." Corporate Ownership and Control 13, no. 2 (2016): 113–31. http://dx.doi.org/10.22495/cocv13i2p12.
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Using evidence from paired franchisor-franchisee dyads, this study identifies how plural formed ownership mechanisms curb the risk of shirking and free riding in franchise systems. These risks have damaging effects on the invested capital of franchisee entrepreneurs. Although shirking and free riding produce a major source of uncertainty for the franchisee entrepreneur it can be limited by plural formed governance dimensions. These mechanisms have different effects based on unit status, i.e., company owned-units versus franchisee-units. We tested our model using a paired-dyadic data approach to mitigate the problem of shared-method variance among the psychometric measures. Results support the contention that competition limits shirking and free riding across inter-firm relationships, but did not support the hypothesized role of relational mechanisms in lowering potential shirking and free riding. Also, endogeneity test uncovered that dealer’s self-selected into either one of the plural form contracts. Drawing on the economics, marketing and management literatures, this study presents a basis for further investigation by placing international franchising entrepreneurship into a broader context of transactional and relational governance
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Świętek, Agnieszka. "Innowacyjność sieci franczyzowych." Studies of the Industrial Geography Commission of the Polish Geographical Society 20 (January 1, 2012): 168–81. http://dx.doi.org/10.24917/20801653.20.12.
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A lasting success of business activities regardless of their location, nature, size and industry isnow dependent on the degree of innovation. Innovation is a way for modern enterprises to survive in thechanging market, and a response to customer needs, including their formation, but also seeking waysto develop the internal businesses, particularly in its organization and ideas. Innovation today cannotbe limited to the creation of new technological solutions, and then their implementation into industrialproduction. A particular kind of a modern business model, which has been recently developing inPoland and which is an example of an innovative organization in many fields, is the franchise, the focusof this article.In the article, the principles of operation and the current state of development of franchise networksin Poland is explained, and then the innovative features of franchise business in general, resultingfrom franchise agreements, are analyzed. In the final part of the article, examples of innovations arepresented: technological, market and organizational innovations, used in various franchise industries.In the article, the author also pays attention to the unique character of the franchise system, basedon assistance and transfer of know-how to its franchisees by the entrepreneur, which reduces therisk arising from the start-up of new economic activity, and affects the fast and multi-dimensionaldevelopment of franchise networks.
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Triyana, Lily. "ASPEK YURIDIS PERJANJIAN BUSINESS FRANCHISE DI INDONESIA." Yuriska : Jurnal Ilmiah Hukum 10, no. 1 (February 4, 2020): 1. http://dx.doi.org/10.24903/yrs.v10i1.256.
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In Indonesia there is no regulation about franchise. Same thing is also experienced of many state, for example English and Australian. No special regulation about franchising can be consedered to be good news or is bad news. The bad news is wth no special guidance, hence goodnesss of franchisor amd also of franchisee have to reckon on written agreement in cooperation contract. Irts meaning both parties have to neglectless and meticulous to the what agreed on. Protection of other decision which arrange an cooperation of Franchising represent the source of which whereas can be made by guidance do complied agreement have the basis for real correct and fair. Association of franhcising generally realese code of ethic of franchising.good news of inexistence regulation of area of franchising is goodness of franchisor and fracnhisee earn free compromise whateverly. As hold of legal fundament of agreement of franchise in Indonesia is freedom contract such as those which arranged in section 1338 KUH Perdata and by concidering conditions of section 1338 KUHP Perdata. Law contract in Indonesia embrace open system meaning that each and everyone is free to make all kinds of contract. In section 1338 KUH Perdata contained by the following rule all made contract lawfully will bind over them making it own. In the case conditions of 1320 section of KUH this Perdata is fulfilled by hence comand of section 1338 KUH Perdata. The making agreement act as code/law to all party. So franchise, and vitally hence to all party arrange agreement content detail.Solving of dispute represent problem which in many is important to licencer, specially In the case of giving of license. Right of intellectual properties in the form of trade secret. Solving of dispute which is through jurisdiction forum, it is though enabled to be emphasized in conference closed (for the secret of trade) felt concerned abaout by licencer party will become an openly forum to receiver of license which do not good mine. To avoid the mentioned hence better each ; every dispute realted to agreement of giving license finished in framework of alternative of is solving of dispute, including in it arbitrase.Ordinary license agreement unlike giving of agreement of license of franchise. If at giving of agreement of license usually only covering giving of permission cover all sort of kinds of intellectual property that appliances bought or rented from him. Besides so-called above, agreement of franchise are; giving of license abaout name of trading, model brand, desain, ets. Rules that can be grouped in the field of contractual law and in the field of law about intellectual property.
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Triana, Lily. "ASPEK YURIDIS PERJANJIAN BUSINESS FRANCHISE DI INDONESIA." Yuriska : Jurnal Ilmiah Hukum 10, no. 1 (February 25, 2018): 1. http://dx.doi.org/10.24903/yrs.v10i1.263.
Full textAbstract:
In Indonesia there is no regulation about franchise. Same thing is also experienced of many state, for example English and Australian. No special regulation about franchising can be consedered to be good news or is bad news. The bad news is wth no special guidance, hence goodnesss of franchisor amd also of franchisee have to reckon on written agreement in cooperation contract. Irts meaning both parties have to neglectless and meticulous to the what agreed on. Protection of other decision which arrange an cooperation of Franchising represent the source of which whereas can be made by guidance do complied agreement have the basis for real correct and fair. Association of franhcising generally realese code of ethic of franchising.good news of inexistence regulation of area of franchising is goodness of franchisor and fracnhisee earn free compromise whateverly. As hold of legal fundament of agreement of franchise in Indonesia is freedom contract such as those which arranged in section 1338 KUH Perdata and by concidering conditions of section 1338 KUHP Perdata. Law contract in Indonesia embrace open system meaning that each and everyone is free to make all kinds of contract. In section 1338 KUH Perdata contained by the following rule all made contract lawfully will bind over them making it own. In the case conditions of 1320 section of KUH this Perdata is fulfilled by hence comand of section 1338 KUH Perdata. The making agreement act as code/law to all party. So franchise, and vitally hence to all party arrange agreement content detail.Solving of dispute represent problem which in many is important to licencer, specially In the case of giving of license. Right of intellectual properties in the form of trade secret. Solving of dispute which is through jurisdiction forum, it is though enabled to be emphasized in conference closed (for the secret of trade) felt concerned abaout by licencer party will become an openly forum to receiver of license which do not good mine. To avoid the mentioned hence better each ; every dispute realted to agreement of giving license finished in framework of alternative of is solving of dispute, including in it arbitrase.Ordinary license agreement unlike giving of agreement of license of franchise. If at giving of agreement of license usually only covering giving of permission cover all sort of kinds of intellectual property that appliances bought or rented from him. Besides so-called above, agreement of franchise are; giving of license abaout name of trading, model brand, desain, ets. Rules that can be grouped in the field of contractual law and in the field of law about intellectual property.
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Lucia-Palacios, Laura, Victoria Bordonaba-Juste, Melih Madanoglu, and Ilan Alon. "Franchising and value signaling." Journal of Services Marketing 28, no. 2 (May 6, 2014): 105–15. http://dx.doi.org/10.1108/jsm-09-2013-0253.
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Purpose – The purpose of this paper is to demonstrate how signaling support services and contractual arrangements that create value for incumbent franchisees can help to create value for the whole network by attracting prospective franchisees. Design/methodology/approach – Using data from Bond's Franchising Report the study analyses franchisors operating between 1994 and 2008 via a Generalized Method of Moments (GMM) model for an unbalanced panel of 2,474 franchisors. Findings – Training, financial assistance, sub-franchising and restrictions against passive ownership, and the use of area development agreements are found to be valuable for prospective franchisees. Experience and the number of company-owned and franchised units also attract prospective franchisees. Research limitations/implications – Our findings imply that not all value-creating services and contractual arrangements are interpreted in the same way by prospective franchisees. Franchisors should offer training and financial assistance to new franchisees in the early stages of a franchise. They should also allow sub-franchising but restrict passive ownership and offer the possibility for area development agreements as contractual arrangements to appeal to new franchisees. Franchisors should focus not only on expansion, but should view the chain in a holistic manner by sustaining and growing both franchised and company-owned units. Originality/value – The findings contribute to the franchising literature by providing new evidence on how offering and signaling some contractual arrangements and support services can help franchisors create value for incumbent franchisees and can attract new franchisees. Our research shows that value in franchising is created differently depending on whether the franchisees are incumbent or prospective.
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Lee, Eunkyung, Ji-Hern Kim, and Chang Seop Rhee. "Effects of Marketing Decisions on Brand Equity and Franchise Performance." Sustainability 13, no. 6 (March 18, 2021): 3391. http://dx.doi.org/10.3390/su13063391.
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The purpose of this study is to provide a way of pursuing a balanced profitability between franchisors and franchisees leading to the sustainability in franchising. Based on a belief that the formation of brand-centric relationship is vital for the success of franchising system, we constructed a model that examines the relationships between marketing decisions, brand equity, and the financial performances of franchisors and franchisees. We used actual data of the Korean franchise chains, including measures of channel intensity and advertising and promotional activities as franchise marketing decisions as well as the profitability of franchisors and franchisees for the analysis. The results of analysis show that while advertising and promotion expenditure has a positive impact on the performances of both franchisors and franchisees, the number of stores does not influence them in the same way. This indicates that their interests may conflict. This study suggests that marketing decisions can be utilized as a means of achieving balanced profitability that would benefit the sustainability in franchising between franchisors and franchisees.
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Alon, Ilan, and Michael Alexander Kruesi. "The enigma of franchising in China." Journal of Business Strategy 41, no. 5 (November 4, 2019): 15–25. http://dx.doi.org/10.1108/jbs-06-2019-0108.
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Purpose Although China is among the most populated and fastest growing markets in the world, the reason why China’s franchising scale and scope is so limited remains an enigma. The purpose of this paper is to shed light on franchising in China and offer strategies for practitioners to more effectively operate under a franchise model in the Chinese market. Design/methodology/approach This paper reviews both literature and practical sources providing some primary data from interviews conducted with franchise industry practitioners in China. Findings The findings of this paper are that foreign entrants to China must carefully consider if they should enter the Chinese market through franchising or if the market may be too difficult to navigate. Franchisors, whose brand is unknown in China or have operations that are too Western-centric, should probably seek international markets closer to home. Those with a high value proposition in the local market and the capabilities to adapt effectively to China’s peculiarities may, however, find a promising and profitable niche to operate in. Originality/value This paper focuses on the under examined realities of franchising in the Chinese market. Based on the previous experiences of franchisors in China, the paper raises seven practical strategies that practitioners can use to more successfully enter the Chinese market through franchising. Although China is among the most populated and fastest growing markets in the world, the reason why China’s franchising scale and scope is so limited remains an enigma. According to the International Franchise Association and International Trade Administration reports, China is among the top-ranking countries in terms of trade opportunities, with the top 100 franchisor sales estimated at ¥428bn (about US$66bn). China is the largest franchise market in the world, with over 4,500 franchise systems and some 400,000 franchised outlets in over 70 industries. However, considering China’s US$13.6tn (2018) economy, this is still far lower than its full potential. In addition, the scope of franchising is limited and is mostly centered in food and beverage and retail outlets, which consists of approximately 40 per cent of all franchisors.
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Zajko, Katja, and Barbara Bradač Hojnik. "Social Franchising Model as a Scaling Strategy for ICT Reuse: A Case Study of an International Franchise." Sustainability 10, no. 9 (September 3, 2018): 3144. http://dx.doi.org/10.3390/su10093144.
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Reuse is a type of concept meant to solve environmental problems and can be implemented in different models. This study explores the social franchising model in the area of ICT reuse, relying on a case study of international social franchise and a comparative analysis of its three franchisees. The concept of the proposed social franchising model is based on a theoretical framework and a case study organization analysis, and has four developmental phases with nine identified key factors, which are essential to creating the necessary systematic approach for a successful outcome by creating both economic and social impact on a scale. This article contributes to the social entrepreneurship literature by analyzing success factors that have allowed our case study to operate as a highly successful franchise. The empirical part of the paper employs a case study of the organization to provide evidence of the existing model for social franchising in the reuse of ICT in Ireland, the U.S. and Slovenia. The paper concludes by revealing the social franchising model framework in the reuse of ICT.
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Deng, Siyuan. "Research on franchised store chain operation based on evolutionary game theory." E3S Web of Conferences 275 (2021): 03022. http://dx.doi.org/10.1051/e3sconf/202127503022.
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Franchised store chain is the most popular business model today. The franchisor and the franchisees share the same brand, but the value of the entire brand will be degraded once one side pursues self-interests in brand management. From the perspective of franchised store chain, this paper develops an evolutionary game model between franchisor and franchisees under the assumption of bounded rationality. The strategic selection of franchisor and franchisees includes cooperation and no-cooperation. In the end, the corresponding policy recommendations are proposed in the foundation of case analysis.