• Journal of Distribution Science
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• v.15 no.2
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• pp.91-100
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• 2017

Purpose - Domestic franchise market has been grown steadily, reaching 50 trillion won in sales and 3,360 franchise headquarters in 2014. A franchise system is an effective business system for the franchisees to lower the failure rate due to the fact that the inexperienced entrepreneurs are supported by their headquarters through the franchisee contract. However, there are also conflicts between franchiser and franchisee behind the quantitative growth of domestic franchise industry. Therefore, it is very important to structure the causes of conflicts and to examine the effect of factors on the relationship commitment and performances. Research design, data, and methodology - In this study, the author divides the composite incompatibility between the franchise and the franchisee into goal incongruity, domain dissensus, and perceptual differences, and examines each dimension to the relationship with commitment and performances. To verify the proposed research model and test hypotheses, the author selected 200 franchise responses in food and beverage industry. The data were analyzed using SPSS 18.0 and AMOS structural equation modeling program. Results - The empirical findings provide goal incongruity and perceptual differences have a negative effect on the affective commitment, but not the calculative commitment. In addition, affective commitment and calculative commitment are found to have a positive effect on re-contractual intention and extended brand shop running intention, respectively. Affective commitment have a stronger effect on re-contractual intention than calculative commitment. Conclusions - First of all, the fact that goal incongruity and perceptual differences negatively affect the affective commitment, but it does not affect the calculative commitment. It means the relationship commitment in distribution channel are multi-dimensional concept that may be attributed to emotional or affective dimensions but may exist in terms of necessity or power-dependence. Second, the level of relationship commitment such as affective and calculative commitment to franchise headquarters positively affects the re-contractual intention and franchiser's extend brand shop running intention suggest that franchiser should encourage and support existing franchisee's commitment. Third, the fact that affective commitment has a greater effect on relationship performance than calculative commitment means to induce franchisee's affective commitment and to prevent the inconsistency between goals and perceptual differences.

• The Journal of the Korea Contents Association
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• v.9 no.6
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• pp.390-398
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• 2009

This study researches on the two types. First, Researched into important perception, relationship maintenance perception, relationship improvement, relationship recognition between franchisor and franchisee, Seconds, Researched into correlation between franchisor and franchisee at function achievement and relationship maintenance, conflict resolve and relationship maintenance, function achievement and compare with competitor. If franchisor with to experience the benefits of a strong franchise partnership, they must be willing to work on behalf of the partnership, perform roles that may extend beyond their traditional boundaries, and resolve their disagreement to the benefit of the partnership rather than to their own benefit. Strong partnerships require sacrifices on the part of both the franchisees and franchisors. However, These sacrifices have substantial payoffs in terms of franchisor performance as well as the performance of the relationship as a whole.

• Culinary science and hospitality research
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• v.20 no.6
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• pp.175-189
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• 2014

This study was intended to provide fundamental data concerning franchising companies' characteristics and performance in foodservice business by employing financial data from the firms' IDS(Information Disclosure Statements). Multiple regression analysis method was used to identify any correlations among franchising size, marketing competency, operational characteristics, and performance according to technique based upon 169 IDS data as of 2013. In terms of franchisor size and performance, the number of company-operated stores had statistically significant corelation with sales, net income, the total number of stores, and the number of franchisees. With respect to marketing competency and performance, advertising expenses showed statistically significant correlation with sales, the total number of stores, promotion expenses with sales, net income, and the total number of stores. On the other hand, there was no statistically significant correlation with current year's net income. At last, present study found significant correlations among business years, sales, current year's net income, and the total number of stores by regarding operational characteristics and performance, but there was no significant correlation between brands and performance. This study is cross-sectional study which is a limitation to be overcome in further studies. In addition, it is required to review the possibility for franchise management style to contribute to expanding the Korean traditional foods.

• Journal of the Korea Society of Computer and Information
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• v.25 no.12
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• pp.305-313
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• 2020

In this paper, We Propose a ways how franchise service of delivery app should be made by analyzing the effect of delivery app usage properties of food service franchisee on satisfaction, business performance and intention of reusing, and suggest support plan of delivery app for franchise by food service franchisee. This study conducted survey on 212 franchises that have experience using delivery app among food service franchisees. To verify the hypothesis of the study, single regression and multiple regression analysis were conducted for verifying the relationship between variables. Key results of the study are as follows. First, it was found that the delivery app usage properties of food service franchisee had a positive relationship with satisfaction. Second, it was found that the delivery app usage properties of food service franchisee had positive relationship with business performance. Third, the satisfaction was found to affect business performance. Fourth, it was found that the satisfaction didn't affect the intention of reusing, and business performance was found to have a positive effect on the intention of reusing. It is necessary to increase the satisfaction of using of franchises through continuous management and reasonable pricing policies, and the headquarter of franchisee should be able to contribute to energetic sales of franchises through effective cooperation with delivery app companies.

• The Korean Journal of Franchise Management
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• v.10 no.3
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• pp.13-23
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• 2019

Purpose - The recent franchise industry is rapidly developing. Some franchisees have a low barriers to entry and competition among companies is intensifying. In this dynamic competitive environment, companies need to focus on customer preferences, quality, and technical interfaces to gain competitive advantage. As a result, companies are required to measure the performance of service values in order to provide differentiated services from competitors. In the franchise industry, customer experience marketing of service values will enable companies to create new businesses. Franchise firms should explore a variety of services to increase service value and reduce failures. Research design, data, methodology - The questionnaire of this study was based on the previous research. Surveys were conducted on panels of online surveys. Surveys were conducted on the panel who had visited the restaurant franchise within the past month. The survey was conducted for about 7 days from February 13, 2019 to February 19, 2019. Total 300 samples, 293 were used in the analysis except for seven unfair questionnaires. Results - The findings of this study are as follows: Emotional, monetary, and reputation values have positive effects on cognitive and affective attitudes. Quality value and behavioral value did not effect cognitive attitude and affective attitude significantly. In addition, affective attitude has positive effect on loyalty, but cognitive attitude did not significant effect on loyalty. Conclusions - First, food-service franchise company should develop a service that enables customers to use the store conveniently. We need to develop a comfortable environment for our customers and provide intangible services. Second, food-service franchise company should provide a reasonable price service. Food-service franchise company needs to sell a high quality menu at a reasonable price to generate profits. Third, food-service franchise companies need to strategically respond to their reputation. In other words, food-service franchise company needs to constantly monitor the reputation of its customers and respond appropriately to market conditions. Fourth, food-service franchise company needs to develop a service method capable of emotional interaction with customers. Food-service franchise firms need to develop ongoing service methods and educate their staff.

• The Korean Journal of Franchise Management
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• v.10 no.2
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• pp.33-47
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• 2019

Purpose - The purpose of this study is to classify and analyze existing studies from various angles through systematic literature review of how human resources development has been researched in the domestic franchise business. These studies are intended to suggest the direction in which human resource development research should be conducted in the future in the franchise business. Research design, data, and methodology - This study is based on systematic literature review methodology. It has gone through the process of subject language setting, literature search routing, search term selection, literature selection, literature classification and literature analysis. The systematic literature review identified 59 peer-reviewed dissertations and scientific journal publications on the subject of HRD in Korea franchise business. Result - This study analyzed by research methods, research industries, research population and dependent variable using the systematic review process. The literature studied in the 2000s mainly led to research on education and training of franchise employees in beauty franchise business. In the literature studied since 2010, human resources development was mainly studied in the supervisor in the restaurant franchise business, and in the study of competence rather than education and training. According to the research methods, statistical methods were mostly relatively simple, such as t-test or one-way distribution analysis until the 2000s, and after 2010, in-depth and structural studies using multiple return analysis, structural method analysis, path analysis, multi-dimensional scale analysis, AHP, etc were conducted. When classified by study dependant, early research until the 2000s focused on the study of education and training, which is an independent variable, on the satisfaction of education programs, job satisfaction, and immersion. On the other hand, studies conducted since 2010 have produced more complex results using various medium variants, and those related to management performance and relationship performance have been mainly studied, rather than the satisfaction of the education itself. Conclusions - While the domestic franchise business is expanding in terms of quantity, such as the number of franchises and franchises, the development in terms of quality for the joint growth of franchises and franchisees is still lacking. In order for the franchisee to continue to grow with each other, the franchisee must identify and develop their current performance or expected capabilities through capacity modeling at various targets and levels.

• Journal of Distribution Research
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• v.15 no.1
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• pp.73-101
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• 2010

Using data collected from franchisees from Busan, we empirically examined the relationship both structural (tie strength), relational (trust), and cognitive (shared value) of social capital and between those dimensions and the patterns of economic performance and noneconomic performance (relationship continuity intention). So we established 9 hypotheses to test the structural relationship among dimensions of social capital and performances like below. H1: A franchisee's perceived tie strength with its franchisor will positively influence its trust in the franchisor. H2: A franchisee's perceived shared value with its franchisor will positively influence its trust in the franchisor. H3: A franchisee's perceived tie strength with its franchisor will positively influence its economic performance. H4: A franchisee's perceived shared value with its franchisor will positively influence its economic performance. H5: A franchisee's perceived trust in its franchisor will positively influence its economic performance. H6: A franchisee's perceived tie strength with its franchisor will positively influence its relationship continuity intention with the franchisor. H7: A franchisee's perceived shared value with its franchisor will positively influence its relationship continuity intention with the franchisor. H8: A franchisee's perceived trust in its franchisor will positively influence its relationship continuity intention with the franchisor. H9: A franchisee's perceived economic performance will positively influence its relationship continuity intention with the franchisor. The conceptual model specifying the relationship among dimensions of social capital and performances is presented in Fig. 1. Tests of the hypotheses were performed using a structural equation model. This model also reflected a good fit to the data ($\chi^2$=101.12 df=62 p=0.004, RMSEA=0.050 GFI=0.936 AGFI=0.895 NFI=0.959 CFI=0.986). The standardized solution estimated by the AMOS 7 program was for interpreting the structural results (Table 1). As was expected, tie strength and shared value were founded to be significant predictors of trust (H1 supported; H2 supported). Tie strength and trust have a significant positive effect on economic performance (H3 supported; H5 supported). But shared value have not a significant effect on economic performance (H4 Rejected). Tie strength were not associated with relationship continuity intention (H6 Rejected). While on the other higher shared value, trust, and economic performance have a significant effect on the relationship continuity intention (H7 supported; H8 supported; H9 supported). The results show integratedly that, first, tie strength does not affect directly but affects indirectly on relationship continuity intention via trust and economic performance. Second, shared goals affect directly and do indirectly via trust on relationship continuity intention. But shared goals does not affect via economic performance on relationship continuity intention. Finally, the study suggests important implications for both research and practice for franchise system especially.

• Journal of Distribution Science
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• v.9 no.4
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• pp.63-73
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• 2011

The relationship between buyers and sellers is changing into a long-term relationship. A number of distribution channel researchers have determined that the behavior of distribution channel members can be characterized by relational exchanges. The members of relational distribution channels may be perceived as strategic partners; however, even within these arrangements, member asymmetries may exist, which can create unequal distributions of power and dependence. Thus, as all distribution channel members may not be equal in power, it is possible that a less-dependent channel leader may emerge. Therefore, leadership in distribution channels is a very important variable. Distribution channel leadership can be defined as the activities undertaken by the distribution channel leader to influence the marketing programs and strategies of channel members. A distribution channel's performance is influenced by the leadership style of the channel leader. Although research on channel leadership styles can be broadly categorized, many researchers have dealt with analyzing distribution channel leadership by using the power-influence approach, which includes looking at variables, such as power, power base, and influence strategies. Moreover, they have examined the direct relationship between leadership styles and performance. Many distribution channel scholars have attempted to justify the application of leadership styles identified in alternative leadership theories to the inter-organizational context of distribution channels. They have made suggestions regarding how great the usefulness of leadership style as a strategy is to secure the compliance of distribution channel members and have conceptually and empirically linked it to channel-related phenomena, such as manifest conflict, cooperation, channel efficiency, and effectiveness. However, as few empirical studies have examined the antecedents and consequences of leadership styles, research on leadership style can be considered nascent. Thus, it is required to investigate the antecedents and consequences of the leadership style of a distribution channel leader. This study aims to empirically identify whether there are influences of the antecedents of leadership on two different leadership styles, and to reveal whether these leadership styles induce any consequences. The research subjects were 220 franchisees. Research findings are as follows: First, the results show a positive effect of technological capability on transformational relationships. However, it does not have a significant effect on transactional leadership. Second, innovation-oriented organizational culture has negatively influenced both leaderships. However, task-oriented organizational culture positively and significantly influenced both forms of leadership. Third, the ethics of leaders has influenced both leadership styles positively and significantly. Fourth, regarding consequences, transformational leadership strengthens financial performances, whereas it weakens relational citizenship behaviors. However, transactional leadership positively influences relational citizenship behavior whilst negatively affecting financial performance.

• Journal of Distribution Science
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• v.10 no.6
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• pp.39-53
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• 2012

It is widely known that knowledge management plays a facilitating role that contributes to upgrading organizational performance. Knowledge management systems (KMS), especially, support the knowledge management process including the sharing, creating, and using of knowledge within a company, and maximize the value of knowledge resources within an organization. Despite this widely held belief, there are few studies that describe how companies actually develop, share, and practice their knowledge. Companies in the domestic small franchise sector, which are in the early stages in terms of knowledge management, need to improve their KMS to manage their franchisees effectively. From this perspective, this study uses a qualitative approach to explore the actual process of knowledge management implementation. This article presents a case study of PB (Paris Baguette) company, which is the first to build a KMS in the franchise industry. The study was able to confirm the following facts through the analysis of target companies. First, the chief executive's support is a critical success factor and this support can increase the participation of organization members. Second, it is important to build a process and culture that actively creates and leverages information in knowledge management activities. The organizational learning culture should be one where the creation, learning, and sharing of new knowledge is developed continuously. Third, a horizontal network organization is needed in order to make relationships within the organization more close-knit. Fourth, in order to connect the diverse processes such as knowledge acquisition, storage, and utilization of knowledge management activities, information technology (IT) capabilities are essential. Indeed, IT can be a powerful tool for improving the quality of work and maximizing the spread and use of knowledge. However, during the construction of an intranet based KMS, research is required to ensure that the most efficient system is implemented. Finally, proper evaluation and compensation are important success factors. In order to develop knowledge workers, an appropriate program of promotion and compensation should be established. Also, building members' confidence in the benefits of knowledge management should be an ongoing activity. The company developed its original KMS to achieve a flexible and proactive organization, and a new KMS to improve organizational and personal capabilities. The PB case shows that there are differences between participants perceptions and actual performance in managing knowledge; that knowledge management is not a matter of formality but a paradigm that assures the sharing of knowledge; and that IT boosts communication skills, thus creating a mutual relationship to enhance the flow of knowledge and information between people. Knowledge management for building organizational capabilities can be successful when considering its focus and ways to increase its acceptance. This study suggests guidelines for major factors that corporate executives of domestic franchises should consider to improve knowledge management and the higher operating activities that can be used.

• Journal of Distribution Research
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• v.17 no.1
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• pp.37-63
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• 2012

In franchise business, exclusive sales territory (sometimes EST in table) protection is a very important issue from an economic, social and political point of view. It affects the growth and survival of both franchisor and franchisee and often raises issues of social and political conflicts. When franchisee is not familiar with related laws and regulations, franchisor has high chance to utilize it. Exclusive sales territory protection by the manufacturer and distributors (wholesalers or retailers) means sales area restriction by which only certain distributors have right to sell products or services. The distributor, who has been granted exclusive sales territories, can protect its own territory, whereas he may be prohibited from entering in other regions. Even though exclusive sales territory is a quite critical problem in franchise business, there is not much rigorous research about the reason, results, evaluation, and future direction based on empirical data. This paper tries to address this problem not only from logical and nomological validity, but from empirical validation. While we purse an empirical analysis, we take into account the difficulties of real data collection and statistical analysis techniques. We use a set of disclosure document data collected by Korea Fair Trade Commission, instead of conventional survey method which is usually criticized for its measurement error. Existing theories about exclusive sales territory can be summarized into two groups as shown in the table below. The first one is about the effectiveness of exclusive sales territory from both franchisor and franchisee point of view. In fact, output of exclusive sales territory can be positive for franchisors but negative for franchisees. Also, it can be positive in terms of sales but negative in terms of profit. Therefore, variables and viewpoints should be set properly. The other one is about the motive or reason why exclusive sales territory is protected. The reasons can be classified into four groups - industry characteristics, franchise systems characteristics, capability to maintain exclusive sales territory, and strategic decision. Within four groups of reasons, there are more specific variables and theories as below. Based on these theories, we develop nine hypotheses which are briefly shown in the last table below with the results. In order to validate the hypothesis, data is collected from government (FTC) homepage which is open source. The sample consists of 1,896 franchisors and it contains about three year operation data, from 2006 to 2008. Within the samples, 627 have exclusive sales territory protection policy and the one with exclusive sales territory policy is not evenly distributed over 19 representative industries. Additional data are also collected from another government agency homepage, like Statistics Korea. Also, we combine data from various secondary sources to create meaningful variables as shown in the table below. All variables are dichotomized by mean or median split if they are not inherently dichotomized by its definition, since each hypothesis is composed by multiple variables and there is no solid statistical technique to incorporate all these conditions to test the hypotheses. This paper uses a simple chi-square test because hypotheses and theories are built upon quite specific conditions such as industry type, economic condition, company history and various strategic purposes. It is almost impossible to find all those samples to satisfy them and it can't be manipulated in experimental settings. However, more advanced statistical techniques are very good on clean data without exogenous variables, but not good with real complex data. The chi-square test is applied in a way that samples are grouped into four with two criteria, whether they use exclusive sales territory protection or not, and whether they satisfy conditions of each hypothesis. So the proportion of sample franchisors which satisfy conditions and protect exclusive sales territory, does significantly exceed the proportion of samples that satisfy condition and do not protect. In fact, chi-square test is equivalent with the Poisson regression which allows more flexible application. As results, only three hypotheses are accepted. When attitude toward the risk is high so loyalty fee is determined according to sales performance, EST protection makes poor results as expected. And when franchisor protects EST in order to recruit franchisee easily, EST protection makes better results. Also, when EST protection is to improve the efficiency of franchise system as a whole, it shows better performances. High efficiency is achieved as EST prohibits the free riding of franchisee who exploits other's marketing efforts, and it encourages proper investments and distributes franchisee into multiple regions evenly. Other hypotheses are not supported in the results of significance testing. Exclusive sales territory should be protected from proper motives and administered for mutual benefits. Legal restrictions driven by the government agency like FTC could be misused and cause mis-understandings. So there need more careful monitoring on real practices and more rigorous studies by both academicians and practitioners.