International Franchising Relationships

Robson, Matthew J.; Kadile, Vita; Watson, Kathryn; Clegg, L. Jeremy

doi:10.1007/978-3-319-61385-7_17

Cited by 3 publications

(5 citation statements)

References 34 publications

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“…Franchising is an attractive business concept that enables franchisors to expand internationally quickly and with few resources, and it allows franchisees to benefit from the franchise's brand name value and proven operational procedures. However, compared with other market entry modes (e.g., wholly owned subsidiaries, joint ventures), international franchising has received less research attention (Robson et al 2018). This research extends current knowledge about international franchising by focusing on a contractual provision that helps address the problem of double-sided moral hazard in such partnerships: the royalty rate.…”

Section: Discussionmentioning

confidence: 99%

“…Nevertheless, international franchising is still considered a “Cinderella topic” in the marketing literature (Robson et al 2018, p. 428); it has received considerably less attention than other foreign market entry modes, such as wholly owned subsidiaries (e.g., Birkinshaw and Morrison 1995; Homburg and Prigge 2014; Leung, Tse, and Yim 2019) and joint ventures (e.g., Calantone and Zhao 2001; Shu, Jin, and Zhou 2017; Tower, Hewett, and Fenik 2019). Previous studies mostly focus on (1) why firms choose to enter foreign markets through franchising (e.g., Erramilli and Rao 1993; Fladmoe-Lindquist and Jacque 1995), (2) what criteria franchisors apply when selecting foreign partners and managing the relationships with them (e.g., Altinay 2006; Brookes and Altinay 2011), and (3) how franchises operate in foreign markets (e.g., Alon 2006; Garg and Rasheed 2003).…”

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confidence: 99%

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What Drives Royalty Rates in International Franchising?

Zeißler¹,

Mandler²,

Kim³

2022

Journal of International Marketing

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Royalty rates are an essential contractual provision to reduce the risk of opportunism in franchising partnerships, many of which are international. However, extant research provides limited insights into the factors that determine the level of royalty rates in international franchise agreements. To address this gap, the authors conceptualize and empirically test a model that treats country characteristics (economic potential, legal rights protection, and cultural distance) and contract characteristics (territorial exclusivity and contract duration) as drivers of royalty rates, accounting for product-market profile and service type as potential contextual factors. Using a unique data set comprising 125 international franchising contracts between franchisors and franchisees from 19 countries, the authors find that economic potential (but not territorial exclusivity) is associated with higher royalty rates while legal rights protection, cultural distance, and contract duration are associated with lower royalty rates. While these relationships are robust across B2C and B2B markets, the impact of economic potential (legal rights protection) on royalty rates is more (less) pronounced for people-processing services, compared to possession-processing services. This work extends the literature exploring the contracting stage of international franchising and provides insights that inform franchisors’ and franchisees’ decisions related to the design of such contracts.

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Section: Discussionmentioning

confidence: 99%

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confidence: 99%

What Drives Royalty Rates in International Franchising?

Zeißler¹,

Mandler²,

Kim³

2022

Journal of International Marketing

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“…This information should be exchanged based on franchisees' willingness; a franchisor should not interfere with the day‐to‐day operations of the franchisees, but rather conduct this activity periodically instead (Morgan & Stoltman, 1997). Robson et al (2018) find that ongoing communication, including information exchange between UK franchisors and franchisees, could develop and manage international franchising relationships in emerging markets. This information exchange empowers franchisees to make informed decisions, avoid common pitfalls, and implement best practices, thereby improving business performance.…”

Section: Conceptual Model and Hypothesis Developmentmentioning

confidence: 99%

Franchise management strategy driving franchisee performance in the service sectors in Thailand

Darawong

2024

Strategic Change

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This empirical study aims to investigate the impact of different dimensions of franchise management strategies on franchisee performance in the professional service sector. The hypothesized relationship was supported by agency theory, which explains the situation of two parties, one representing the other in day‐to‐day transactions. The samples were 259 managers and supervisors who had worked for franchise service businesses located in Thailand and had regular contact with the franchisor of the global firm. Purposive and snowballing methods were employed to distribute questionnaires to the target respondents. The results of structural equation modeling indicated a good fit of the data to the proposed model. Hypothesis testing revealed noteworthy direct influences of four franchise management strategies, namely innovative culture, supportive service, information exchange, and recommendation, on the performance of franchisees. This study offers valuable insights into the importance of implementing effective franchise management strategies and their direct implications for franchisee performance. The findings have practical implications for franchise businesses, highlighting key areas of focus for enhancing franchisee success and overall business performance.

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“…Robson M. J., Kadile V., Watson K., Clegg L. J. (2017) [5] explore the issue of formation of franchise agreement. Wiggins J. M. (2020) [6] sets feature of contract management and investigates mergers of hotels through the conclusion of management contract between the owner of the organization and the management company.…”

mentioning

confidence: 99%

“…The franchisor gives the franchisee the right to use the franchise and receives periodic deductions, which are calculated as a percentage of gross income. At the same time, the franchisor does not interfere in the operational management of the hotel, but only monitors compliance with standards [5].…”

mentioning

confidence: 99%

Clustering in the Tourism Hotel Business to Increase the Economic Efficiency of the Network Structure

Denysenko¹,

Yurynets²,

Biriukova³

2021

EFMR

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The article delves into an important problem known as clustering in the tourism hotel business. The authors attempted to examine the different aspects of the formation of the tourist hotel cluster which allow to increase the economic efficiency of the network structure. The researchers concentrated on the system of formation of tourist hotel cluster for increasing the economic efficiency of the network structure. The network structure of tourist hotels has a number of advantages, which is examined in this article. The key aspect of the system of formation of tourist hotel cluster is creating a structural basis, marketing activities, formation of internal standards. The formation of tourist hotel cluster includes the following elements: inventory of fixed assets of participants, SWOT-analysis, assessment of the potential of all participants of the tourist hotel cluster, analysis of marketing internal and external environment in hotel services, identification of all possible risks and benefits of the cluster, implementation of organizational, legal, social, psychological adaptation of participants to integration in the cluster, the formation of strategies for the development of the tourist hotel cluster, coordination the conditions for participants to join the cluster and further activities in the cluster, preparation for the concluding and signing of contracts. In the study motivational factors and benefits of merging enterprises into tourist hotel clusters were identified by the authors. These motivating factors allow to increase the economic efficiency of the network structure.

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International Franchising Relationships

Cited by 3 publications

References 34 publications

What Drives Royalty Rates in International Franchising?

What Drives Royalty Rates in International Franchising?

Franchise management strategy driving franchisee performance in the service sectors in Thailand

Clustering in the Tourism Hotel Business to Increase the Economic Efficiency of the Network Structure

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