Organizational Form and Performance: Evidence from the Hotel Industry

International audienceWe use a unique proprietary panel data set from a large hotel company to study how organizational form affects hotel pricing and performance. Aggregate data patterns suggest sizable performance differences between franchised and company-operated hotels. However, after controlling for other factors, we find that if significant at all, such differences are economically small. Moreover, once we endogenize the choice of organizational form, the differences become insignificant. We conclude that the company chooses which hotels to franchise and operate corporately such that, conditional on hotel and market characteristics, it obtains consistent outcomes across organizational forms

Franchise Business Development Model: Theoretical Considerations

Franchising is not a popular business development form in Lithuania. Only 0.02% of all Lithuanian companies use franchising for business development, while in most of the developed countries franchise is recognized as a convenient business expansion form. So, what factors determine such differences in the use of franchising? Analysis of related literature showed, that mainly researchers analyse some aspects of franchising, however there is no systematized analysis which covers all the main franchise development elements. Therefore, the aim of this article is to systematize franchise business development phases, main elements and factors, influencing this process and to propose a theoretical franchise system development model. Thus, theoretical considerations about the main phases and elements of franchise system development as well as advantages and disadvantages of the system are analysed in the article. These theoretical considerations are generalized in theoretical franchise system development model, which shows, that development of franchise business consists of particular steps, starting from favourable conditions for the system to emerge; intention and ability of franchisor to form franchise based on his business; the establishment and initial development of franchise system; and its further functioning. The article does not test the model and even does not discuss the operationalization of it. Operationalization of the model as well as empirical evidence is presented by the authors in the forthcoming articles

Lucro líquido do franqueado: um sinal para a escolha de franquia em época de crise

Este artículo aborda desde la perspectiva de la Teoría de Señales la elección de una franquicia por un potencial franquiciado que elige este canal de distribución por primera vez. El objetivo es analizar la relación entre algunas señales enviadas por el franquiciador y la elección de una franquicia por el potencial franquiciado. Concluimos que los efectos de las variables macroeconómicas de España en el periodo 2006-2013 influyeron en los ingresos netos de los franquiciados para que se convirtiera en una señal empleada por éstos a la hora de elegir la franquicia donde abrir un establecimiento.This paper adopts the perspective of Theory of Signals to discuss how someone starting a business as a franchisee for the first time can choose a suitable franchise brand. The aim was to analyze the relationship between certain signals sent by the franchisor and the choice of a franchise brand by the prospective franchisee. Using panel data, we found that the effects of macroeconomic variables in Spain for the 2006-2013 crisis period influenced franchisees' net income, which thus became a relevant signal in their process of choosing a franchise brand to start a business.Sob a perspectiva da Teoria de Sinais, este artigo aborda a seleção de uma franquia por um franqueado que elege esse potencial canal de distribuição pela primeira vez. O objetivo é analisar a relação entre alguns sinais enviados pelo franqueador e a escolha de uma franquia pelo potencial franqueado. Usando a metodologia de dados em painel, os resultados obtidos nos permitiram concluir que os efeitos das variáveis macroeconômicas da Espanha no período de crise econômica (2006-2013) influenciaram as receitas líquidas dos franqueados, tornando-se um sinal para eles elegerem onde abrir um estabelecimento franqueado

Entrepreneurial Orientation Rhetoric in Franchise Organizations: The Impact of National Culture

This study examines the role of national culture on the entrepreneurial orientation (EO) rhetoric contained within franchisee recruitment promotional materials, where EO rhetoric is defined as the strategic use of words in organizational narratives to convey the risk taking, innovativeness, proactiveness, autonomy, and competitive aggressiveness of the firm. The sample comprised 378 franchise organizations, in five different countries (Australia, France, India, South Africa, and the UK). The results indicate that franchise systems operating in high uncertainty avoidance and feminine cultures use less entrepreneurially oriented rhetoric, suggesting that EO rhetoric in franchise organizations varies according to different national cultural contexts

Influential factors of pro-environmental behaviors among franchisees in the fast-food sector

In spite of the increasing attention on environmental sustainability, there is a dearth of knowledge about franchisees' pro‐environmental behaviors. This study aims to understand the factors that influence the extent to which franchisees engage in pro‐environmental behaviors in the fast‐food sector. The research is based on in‐depth interviews with franchisees operating restaurants in the fast‐food sector in France. The empirical evidence in this qualitative study shows how franchisees' pro‐environmental behaviors can be explained as a result of organizational and personal factors, thereby extending the theory of planned behavior, norm‐activation‐model and organizational support theory within the franchising context. This study offers avenues for more research on green practices in franchising, as well as in the hospitality sector and other sectors such as retailing. It provides important implications for franchise practitioners in the fast‐food sector on how to create a more environmentally sustainable business model. The findings offer the first known model of pro‐environmental behaviors of franchisees

Organizational Form and Performance: Evidence from the Hotel Industry,

International audienc

When Key Elements of Franchising Become Sources of Conflicts

International audienceFranchise networks are often faced with conflicts. In this paper, we aim to examine specific sources of franchisor/franchisee conflicts related to the key elements of franchising, i.e., know-how, assistance, and brand. To do so, our empirical study relies on a qualitative approach with 27 in-depth interviews with franchisors and their representatives operating their networks in various industries in the French market. Our study contributes to the literature on conflicts in franchising by focusing on the main elements of franchising as potential sources of conflicts, as well as on the practice by giving advice to franchisors that may minimize such conflicts. © 2023, The Author(s), under exclusive license to Springer Nature Switzerland AG

Franchise vs. Independent Retail and Service Stores: Customer Perceptions

International audienceFranchising is growing in most countries and most industries worldwide. Some people fear that chain-based businesses, including franchised businesses, will soon eliminate totally independent businesses. However, whatever the industry and the location, a coexistence of both franchised businesses and totally independent businesses is often noted. Our aim is thus to understand how consumers react to retail offers of both types of businesses (i.e., franchised or independent), mainly in terms of the profiles of the entrepreneurs, their retailing mix, and their customer relationship management. Our empirical study is based on a qualitative approach with a series of twenty interviews with customers. Our findings show that consumers have a very different store image of franchised and independent stores. © 2023, The Author(s), under exclusive license to Springer Nature Switzerland AG

When Key Elements of Franchising Become Sources of Conflicts

International audienceFranchise networks are often faced with conflicts. In this paper, we aim to examine specific sources of franchisor/franchisee conflicts related to the key elements of franchising, i.e., know-how, assistance, and brand. To do so, our empirical study relies on a qualitative approach with 27 in-depth interviews with franchisors and their representatives operating their networks in various industries in the French market. Our study contributes to the literature on conflicts in franchising by focusing on the main elements of franchising as potential sources of conflicts, as well as on the practice by giving advice to franchisors that may minimize such conflicts. © 2023, The Author(s), under exclusive license to Springer Nature Switzerland AG