• Culinary science and hospitality research
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• v.14 no.2
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• pp.153-169
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• 2008

The purpose of this study is to determine the effects of production strategies operated by franchisors in the food service industry on the franchisees' culinary competence and subsequently franchisees' satisfaction with performance and recontract intention. In order to accomplish this purpose, two franchised enterprises which used mass-purchasing and mass-producing before distributing to each franchisee for the production strategies were participated and eventually 287 franchisees responded to this survey. Factor analysis and Cronbach's alpha showed the validity and internal consistency for the survey questionnaire. LISREL(8.72) was used to test the relationships between variables; production strategy, culinary competences, franchisee satisfaction, and recontract intention of the franchisees. The results present that the franchisees' satisfaction with the management system, quality of distribution, and quality of foods influenced on differentiation performance and supply performance of franchisees. On cost performance, only satisfaction with the food cost had an impact. The higher franchisee satisfaction with the franchisees' operations was, the higher recontract intention was in the franchise business. The results suggest the critical points for improving foodservice supplying system as well.

• Asia-Pacific Journal of Business Venturing and Entrepreneurship
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• v.12 no.3
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• pp.177-190
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• 2017

This study investigates the effects of franchisors' characteristics including brand reputation, training and product related support, franchisees' characteristics including store location and management on the performance and recontract intention of franchisees in bakery franchise industry. Also, this study examine the moderating effect of CEO experience of franchisees among the franchisors' and franchisees' characteristics, and performance. To empirically test these relationships, data were collected from 386 respondents who are franchisees in the bakery franchise sector. In the verification of hypotheses, the structure equation modeling(SEM) is used. The results of this study are as follows. First, franchisors' brand reputation, training support, and franchisees' locational factor have significant effects on the financial performance of franchisees positively. However, franchisors' product related support and franchisees' management of the store have not significant effects on the performance. Second, the performance of franchisees has positive effect on the recontract intention. Third, the moderating effect of CEO experience is only significant in the relationship between franchisors' training support and the performance. Based on the findings, this study suggest the importance of building a good brand image and superior training system for franchisors to improve mutual ongoing growth. Also, franchisors should determine whether nascent franchisee entrepreneurs have CEO experiences to further improve performance. If they do not have related experiences, both opening and ongoing training supports of franchisors and the efforts of franchisees towards learning are required. Finally, this study suggest that both franchisors and franchisees should accurately analyze the conditions of possible locations and establish strategies to select beneficial location before starting a franchise business.

• Journal of Distribution Science
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• v.15 no.2
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• pp.47-51
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• 2017

Purpose - The purpose of the study was to find out factors having influence upon management of franchise convenience stores being distribution business by interview with franchisees in accordance with Delphi method and to investigate marketing strategy of increase income. Research design, data, and methodology - This study investigated not only franchisees but also head office's franchise consultants of convenience stores carefully by Delta technique to suggest actual solutions of practice and to be different from precedent studies. Delphi method's interview and questionnaire were used to investigate performance of franchisees. 120 franchisees were interviewed to consist of men and women. Results - FC visited franchise stores to investigate: Franchisees thought of keeping of exact information on commodity information and sales promotion events, and admitted of franchiser's effort of growth and development of stores and improper visit frequency of stores and low effort of solving of difficulty of franchisees. Conclusions - More than 80% of the franchisees cognized more than 70% of performance upon request of ordering from headquarters: Not only franchisees but also headquarters need to lessen gap of difference of cognition. Franchise headquarters was thought to give services below than common level, and service manual and operation manual were thought to be high. Headquarters need to give practical support service.

• Journal of the Korean Society of Food Culture
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• v.27 no.2
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• pp.172-183
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• 2012

This study was conducted to investigate the effects of the entrepreneurship and market orientation of franchisers on the boundary-spanning behavior of franchisees in food-service companies in the Yeongnam region. This study also investigated the relationship between the entrepreneurship and market orientation of franchisers and sought to identify the effect of the boundary-spanning behavior of franchisees on their managerial performance. Based on literature reviews, 4 hypotheses were tested. The subjects responding in this study were owners or managers of franchise restaurants in Youngnam province. A total of 605 questionnaires were analyzed using the factor analysis, a reliability test, and structural equation modeling analysis. The results revealed that first, the entrepreneurship and market orientation of franchisers were positively related to the boundary-spanning behaviors of franchisees, and secondly, the entrepreneurship of franchisers was positively related to their market orientation. Finally, the boundary-spanning behavior of franchisees was positively related to their managerial performance. Therefore, food-service franchisers in Youngnam should have the entrepreneurship and market orientation to lead franchisees to have positive boundary-spanning behaviors and good performance.

• Journal of Distribution Science
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• v.15 no.9
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• pp.37-52
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• 2017

Purpose - This study explores the influence of franchisors' supports on franchisees financial performance, overall satisfaction and intention to remain. Research design, data, and methodology - Given the exploratory design of the investigation, purposive sampling technique was used to select twenty-six (26) franchisees as key informants for this study. In-depth face-to-face interviews were conducted leading to generation of rich qualitative data on the phenomenon of support services in the Nigeria franchise system. Results - Results indicate that at both the initial and growing stages, training and management service supports have marked influence on franchisees business outcomes. However, findings revealed that at the initial stage, the impact of training is greatest but this impact subsequently declines as franchisees master the nuances of the business. Management services on the other hand maintains a constant relevance through all stages of franchisees business. Conclusions - Three key conclusions were drawn from the findings of this study. First, the quality of initial and ongoing supports have consequences for the long-term health of franchisees and franchisors' businesses. Second, poor management of franchisees' expectations and perception of supports could damage franchise partnerships. Third, franchisees form their expectation of supports largely from the nature of initial supports provided by the franchisors.

• The Korean Journal of Franchise Management
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• v.8 no.1
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• pp.5-18
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• 2017

Purpose - Although literature has established the relevance of entrepreneurial orientation(EO) in the performance of conventional firms, the constraining nature of franchise arrangement makes one wonders if the same relationship holds for companies operating under the business model. Research design, data, and methodology - Using Nigeria - a country with high potential for franchise growth - as a context, this study aims to explore the relevant entrepreneurial orientation skills exhibited by franchisees and show the extent to which these skills influence their business performance and intention to remain. 26 franchisees purposively selected from six local franchise brands in Nigeria were interviewed. Result and Conclusions - The three classic entrepreneurial orientation factors of innovativeness, proactiveness and risk-taking were found to have varying influence on franchisees' business outcomes. This study answers the calls for more in-depth understanding of the relationship between EO and firm performance generally and, franchise firm performance in particular. The value of this effort lies in the fact that it strengthens theory and updates literature on the subject. Based on the findings, specific recommendations are offered to help improve the practice of franchising in Nigeria.

• Journal of Distribution Science
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• v.13 no.4
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• pp.65-76
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• 2015

Purpose - This article aims to present and test a model regarding franchisors' supporting activities that may positively influence franchisees' attitude toward the franchising headquarter and their own business performance. Moreover, the authors examine the moderating effect of competitive intensity between franchisee attitude and business performance. Most previous research focused on behavioral performance measurements such as satisfaction, trust, and commitment. There are few empirical studies that focus on financial performance data because it is difficult to determine a relational mechanism between behavioral and financial performance. Moreover, financial data is confidential and difficult to collect in many cases. However, this study measures financial performance (e.g., sales revenue per square meter) differently than most previous research, which is mostly focused on the behavioral performance measurements. Research design, data, and methodology - To test our hypotheses, we selected 137 franchisee managers who are running chains of one of the foremost bakery franchise brands in South Korea. This study carefully investigated the reliability, content validity, convergent validity, and discriminant validity of the proposed instrument by analyzing the data obtained from the samples. The data was analyzed using the AMOS structural equation modeling program. Results - The results indicated that: non-financial support activities (e.g., information exchange and communication) had a positive impact on the franchisee attitude toward the franchising headquarter. The franchisee attitude in turn had a positive effect on the headquarters' business performance. Furthermore, competitive intensity could enhance the relationship between franchisee attitude toward franchising headquarter and business performance in a local franchise market. However, financial support activities (e.g., rewards and promotional support) and training had no relationship with either franchisee attitude or business performance. Conclusions - This study provides some practical implications to franchisors in terms of franchise operation and store opening strategies. With respect to the franchise operation strategy, franchisors need to focus on non-financial rather than financial support. Most franchisees consider the necessity of financial support activities and not their sufficiency because these activities are specified in their franchise contract. In addition, it is important for franchisees to maintain a positive attitude for the franchise headquarters. The franchisees with a positive attitude for the franchisor can show a high degree of solidarity for various support activities, and it consequently determines franchisees' sales performance. In terms of franchise store opening strategy, this study suggests an additional criterion that can be considered in determining the location of direct and non-direct management stores (e.g., franchisees' stores). In this research, franchise stores located within high level of competitive intensity are shown to have a high relationship between franchisee attitudes of franchisor support activities and business performance compared to the franchisees located within low competitive intensity level. This result shows that opening non-direct franchise stores is more effective than direct stores in higher competitive market situations. Research contribution, implications, and further research directions are discussed at the end of the paper.

• The Journal of the Korea Contents Association
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• v.17 no.3
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• pp.408-420
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• 2017

A franchisee owner, as an entrepreneur who is independent from a franchisor, has the greatest influence on the success of franchisee business. The effect of the franchisees' entrepreneurship on their performance can be different from that of self-employed business owners, due to the fundamental nature that the franchisor and franchisees share a standardized operation and business risks. Therefore, the purpose of this study is to demonstrate whether or not the relationship between the entrepreneurship and the performance, which has been popularized in general, is displayed in franchised stores as well. The current study analyzed the influence of innovativeness, risk-taking, and proactiveness on franchisees' performance based on the samples from 109 Small Size Educational Services franchisees. The results show that the franchisees' proactiveness is the only variable that affects the performance while the effect of the other variables was not significant. These results make implications that, for their business success, franchisee owners should be proactive in their target market, without compromising the quality of franchisor's standardized products and services by being innovative and risk-tolerant.

• Culinary science and hospitality research
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• v.23 no.4
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• pp.175-184
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• 2017

In franchisee industry, it is essential for franchisors to share knowhow and also specialized knowledge in order to realize favorable relationship and performance between franchisors and franchisees. Particularly, in mature food service industry, companies' specialized knowledge and knowhow are the core competence to obtain competitive advantage. Therefore, to create performance, it is absolutely necessary to share information and knowledge among all the franchisees. The purpose of this study is to verify relationship between franchisors' information sharing perceived by food service franchise owners, relationship quality, and relationship performance. A survey was done to food service franchisees, and total 297 samples were used to analyze the structural equation model. According to the analysis results, food service franchise companies' information sharing is significantly correlated with quality of relationship with franchise owners in a positive way. Also, franchisors' knowledge sharing has significant influence on performance of relationship with franchisees in a positive way. The components of relationship quality, trust and immersion, all influence relationship performance. Based on the results, this author suggests several implications about food service franchise management and information sharing.

• Journal of Distribution Science
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• v.12 no.12
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• pp.119-130
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• 2014

Purpose - Franchise industries are significant both socially and economically. However, with increasing interest, there are manifold problems. It is necessary to seek measures for mature operation constantly despite unprepared franchisors, negative perceptions of the media and society toward franchise, and rapid changes in business start-up trends and propensity to consume that make business start-ups difficult. The paper aims to explain the effects of relational commitment and performance on the franchisor's management characteristics and justice in the food service franchise system. Research design, data, and methodology - This is an exploratory survey examining franchising in Korea. Based on a literature synthesis, we extract five constructs: managerial characteristics, support, fairness, trust, and satisfaction. We hypothesize that these factors influence the trust, satisfaction, and performance of franchisees. To examine these hypotheses empirically, we conducted a survey on the database of the Franchising Council of Korea. The study employs data from May to September 2014. In total, 135 completed questionnaires were received, of which 128 were usable. The data was analyzed with SPSS/PC 22.0. First, to test unidimensionality and nomological validity of the measures of each construct, we employed a scale refinement procedure. The result of a reliability test with Cronbach's α and factor analysis warranted unidimensionality of the measures for each construct. In addition, nomological validity of the measures was warranted from the result of the correlation and regression analysis. By analyzing the data, we can confirm most hypotheses. Results - Frist, franchisor characteristics have a positive effect on trust and satisfaction. Second, franchisor fairness has an effect on trust and satisfaction. Third, franchisor support has an effect on satisfaction. Further, the franchisee trust has an effect on satisfaction. Fourth, the satisfaction of a franchisee with a franchisor affects the performance of a franchisee. Finally, there is a possibility that not only franchisee performance but also increasing the credibility and improving the image of the franchisor through communication between franchisor and franchisee can improve franchisees' performance and satisfaction by motivating the franchisee for sustainable growth. Franchisers should endeavor for franchisees to obtain stable revenue with continuous and practical support. They should recognize that they can expand their business by supporting their franchisees. Franchisors should not only instantly respond to franchisees' troubles with interactive communications but also raise the ability of supervisors for better support. Franchisors should share their visions and goals with their franchisees and provide systematic and continuous support based on trust and clear company management. Franchisees should understand franchisors' position as well as participate in establishing the basic franchise system. Contributions - The paper contributes to understanding franchising in Korea. It offers insights and assistance to franchisors hoping to start franchises. This paper explores measurement issues related to franchisee performance by estimating its determinant factors (managerial characteristics, support, fairness, trust, and satisfaction). This study provides franchisors and practitioners planning to extend their franchising business with some practical knowledge.