Intangible Resources and Plural Form as Drivers of Franchise Internationalization: Examination within a Two-Country Perspective

Abstract

International audienceThis study focuses on drivers of franchise network internationalization, namely, intangible resources and plural form. Intangible resources refer to those that the franchisor acquires over time and are deemed instrumental to firm success, namely, brand name, monitoring, and know-how transfer abilities. Plural form refers to the coexistence of franchised outlets and company-owned outlets within the same network. The empirical study involves 853 U.S. and French networks. Findings indicate that the percentage of Company-owned outlets in international networks is lower than that in purely domestic networks, and this holds for both the combined data sample (United States and France) and the U.S. sample on its own. Moreover, U.S. franchisors are shown to be much more internationalized, with a smaller percentage of company-owned outlets than their French counterparts. The intangible resource that most strongly affects franchise internationalization is brand-name recognition, whereas there is partial support for the impact of two other intangible resources, namely, monitoring and know-how transfer ability. The results of the logistic regression models underscore the importance of intangible resources in franchise network internationalization as well as the significant and negative impact of percentage of company-owned outlets. Finally, the drivers of internationalization are not found to be statistically different between both countries

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