Franchise System Research Articles

Going the extra mile: Unveiling the roots of franchisee organisational citizenship behaviours in franchise systems

While researchers and practitioners have recognised the essential role of employee organisational citizenship behaviours (OCBs), there is an absence of their consideration within franchise systems as a unique context. We aim to address this gap by exploring the nature of franchisee OCBs and their antecedents. Through a set of semi-structured qualitative interviews, we find critical new evidence, not only of the existence of franchisee OCBs but also of franchisor OCBs, reflecting the reciprocal character of franchise relationships. Further, we reveal frequent shifts of franchisee OCBs from one referent to another, often from the franchisor to franchisee peers, or even industry groups outside the franchisor-franchisee dyad, in the wake of disappointed interactions with the franchisor. Ultimately, we point at the critical role of the franchisor’s field consultant as the liaison person who appears frequently mismanaged by franchisors in the eyes of franchisees.

Research on Service Quality Improvement of Franchised End Logistics Outlets Based on SERVQUAL

Abstract: As an effective solution to the "last mile" problem of logistics transportation, express terminal network has shown a rapid development trend in recent years. The franchise production is a main operation mode of the end express outlets. By fully mobilizing the enthusiasm of the franchise outlets, the service scope of express enterprises is effectively expanded. However, the problems of loose management and uneven service quality are prevalent in this kind of franchise outlets, which makes the express terminal service become one of the bottlenecks restricting the healthy development of the industry. Based on this, this paper improved the SERVQUAL model combined with the actual situation of the end express outlets of the franchise system, and designed the questionnaire based on it, sorted out and analyzed the survey data by using factor analysis and entropy weight method, and finally found out the shortcomings in the service process of the end express outlets according to the results, and put forward targeted solutions.

A Preliminary Agreement in Franchising Business - Risks and Challenges

This article constitutes a Preliminary Agreement in Franchising. The research process focuses on theoretical and practical aspects of legal issues that concern franchise agreement. This article represents problematic legal issues, experience and tradition in legalizing pre-sale information disclosure plays a significant role in the franchise business. Franchisee maintenance justice mechanisms signify the importance of pre-sale information disclosure and provision principles in the initial stage of making pre-agreements. The article deals with certain controversies revealed in a franchise business caused by the absence of legal regulations at the pre-contractual stage. It emphasizes the lack of a mechanism to protect franchisees’ rights- information disclosed in the Franchise Disclosure Document. It contains recommendations on how to solve existing problems. As a result of observing different models of legal systems and regulations in the pre-contractual stage, it becomes necessary to integrate this new franchising system and pre-sale information disclosure into Georgian law. On the one hand, this study suggests implementing legislation and franchising regulations by combating several legal problems. On the other hand, the research accentuates the adopted model law on information disclosure, “UNIDRUA”, that will be a strongly recommended model contract for such a country as Georgia since it lacks a special law on franchising. The analysis based on this research can be applied by commercial organizations and entrepreneurs that run businesses in terms of franchising.

The moderating role of servant leadership in the relationship between organizational structure and performance in fashion retailing

PurposeThis study aims to reveal how the organizational structure (vertical integration vs. franchising) of 308 stores in a Spanish fashion retail franchise chain affects their performance measured through two key performance indicators commonly used in this industry, namely, labor productivity and service quality ratings. We also appraise the moderating role played by the servant leadership of franchisees and managers of company-owned outlets to explore its influence on the relationship between organizational structure and store performance.Design/methodology/approachWe have used multivariate analyses to study the research questions, with a panel dataset of quarterly store-level data for the period January–December 2022.FindingsVertically-integrated stores record lower labor productivity than franchised ones. This impact is lower in stores run by individuals high in servant leadership than in those run by individuals low in it. Franchised outlets also record lower ratings in service quality than vertically-integrated stores, and this negative impact is weaker in stores run by individuals high in servant leadership.Originality/valueNothing has thus far been published on the moderating effect of servant leadership in the relationship between the organizational structure of different stores and their outcomes in franchise systems.

Digital marketing capabilities, entrepreneurial orientation and franchise systems' performance

PurposeWe adopt the conceptual lens of the Dynamic Capabilities Approach to evaluate the relationship between Entrepreneurial Orientation (EO), Digital Marketing Capabilities (DMC), and Performance in Brazilian franchises.Design/methodology/approachWe applied a survey with franchisors at the Brazilian Franchising Association Expo 2022. Data were collected for 145 franchise systems. We used Partial Least Squares Structural Equation Modeling and tested two distinct models. Model 1 presents the direct effects of EO and DMC on Performance. In Model 2 we include the mediation effect of DMC on the relationship between EO and Performance.FindingsAligned with prior literature, in our first model we found a direct association between EO and Performance and between DMC and Performance. In our second model, when analyzing the combination of EO and DMC, we observed a full mediation effect of DMC in the relationship between EO and performance, and an indirect effect of EO on performance.Originality/valueWe advance in the debate of the relationship between EO and Performance in the franchise context, adding to our model the DMC perspective. Findings shed light on the importance of digital marketing capabilities for franchise systems. These elements open important avenues for dedicated research to further understand how digitalization process can be redefining the drivers of performance in entrepreneurial firms.

Contractual provisions, governance, and maintaining sales leadership: Evidence from franchise systems

Annual sales revenue is one of the most critical indicators of franchise performance not only for the business stakeholders but also for prospective franchisees who are exploring their investment opportunities. Accordingly, Franchise Times ranks and reports the 200 top franchisors annually based on sales performance. Historically, some franchisors have successfully maintained their position among top-ranking firms for years in this credible ranking. Understanding factors associated with such achievement is pivotal for the success and improvement of franchise firms. Despite its importance, the impact of franchise contract provisions on maintaining their sales leadership remains unexplored. In this research, we examine various contract provisions, including cost structure, incentives, and governance, among top franchise firms over time to shed light on factors affecting their sales leadership and continued presence among top-ranking firms. Using the survival analysis, we empirically address this gap by analyzing an unbalanced panel dataset of 153 franchise firms from 2013 to 2020 (1172 firm-year observations). We find that franchisors with contract provisions specifying higher royalty rates, financing support for franchisees, multi-unit or master-franchise-only options, and a primary focus on franchising for expansion are more likely to maintain sales leadership within the industry.

Akad Musyarakah As Productive Waqf Aspect To Optimizing Ar-Rahman Mart According To Fatwa DSN-MUI

Growing of efficient waqf it's also done by means of participating with third parties, supported by issuance of the DSN-MUI Fatwa number: 08/DSN-MUI/IV/2000. So, the study aims to determine how the practice of akad Musyarakah at Ar-Rahman Mart and how the practice of akad musyarakah in perspective of Fatwa DSN-MUI No: 08/DSN-MUI/IV/2000 at Ar-Rahman Mart (ARM). This research is qualitative research with the type of case study through method of interview and documentation. The results obtained are the practice of akad musyarakah at Ar-Rahman Mart use musyarkah or Franchise system or KASOEIBI (Sharing Economic Cooperation or Kerjasama Ekonomi Berbagi) for 5 years beginning in 2019, profit sharing is 9:1 for CV Ar-Rahman and Alfamart, cause this cooperation have same goals to increasing society economic and in Ar-Rahman Mart produce waqf wealth to convert Masjid through profit motivation. The franchise system has principle of openness and prudence by sharia principles, but unfortunately, its contract does not fulfill all rules contained in the DSN-MUI Fatwa, this is because both parties have provided capital, but in the management and operation that occurred at Ar-Rahman Mart, the Ar-Rahman Foundation and CV Ar-Rahman did not have the authority to control the business activities in Ar-Rahman Mart every day.

China franchise market: Current progress and development trends

Subject. This article deals with the issues of history, current status, development trends, and organizational and economic relations in the franchise market of China. Objectives. The article aims to determine the areas of development of franchise systems in China. Methods. For the study, I used a logical analysis. Results. The article reveals the main challenges that international franchisors face when entering the Asian market, and describes franchises that are leaders in the Chinese market. Conclusions. The Chinese franchising market is developing steadily, and the number of franchises of Chinese origin gets increasing. As part of the global expansion, Russian entrepreneurs may consider the Chinese market as a priority for selling a franchise, so in this regard, it is necessary to study the specifics of the local franchise market.

PERLINDUNGAN HUKUM BAGI PENERIMA WARALABA TERHADAP PERUBAHAN PRODUK SECARA SEPIHAK.


 
 
 
 The development of the business world penetrates the boundaries of space, time and territory of a country. One of the breakthroughs made by business people is business development through a franchise system, which in Indonesia is termed a franchise. Republic of Indonesia government regulation no. 42 of 2007 concerning franchising provides a definition of a franchise as a special right owned by an individual or business entity to a business system with business characteristics in order to market goods and/or services that have been proven successful and can be utilized or used by other parties based on a franchise agreement. In Indonesia, the legal regulations regarding franchising are not yet complete, considering that regulation through law has not been touched by the government. This is necessary to prevent franchise business actors from unwanted losses due to the incomplete legal instruments that protect them. This research raises the issue of what are the legal consequences of franchise agreements in the event of unilateral changes to franchise products by the franchisor and what is the legal protection for franchisees? for unilateral changes to franchise products by the franchisor. By using two legal theories as analysis tools, namely the legal protection theory from Satjipto Rahardjo and the legal consequences theory from Soeroso. The method used in this research is a normative juridical research method, namely legal research carried out by examining library materials or secondary data only. The research approaches used are a statutory approach, a case approach, a conceptual approach, an analytical approach and techniques for collecting legal materials by identifying and inventorying positive legal materials, literature. books, journals and other source materials, the technique for analyzing legal materials is carried out using legal interpretation (interpretation), systematic interpretation and methods of analogous legal construction, legal refinement construction (rechtsverfijning) and a contrary argument. The legal consequences of a franchise agreement in the event of a unilateral change to the franchise product by the franchisor, is the disappearance of the legal situation and relationship between the franchiser and the franchisee due to the franchiser's default which has implications for the franchisee experiencing losses due to not providing products, tools and materials for the franchise object. as is the classification that has been agreed. Legal protection for franchisees for unilateral changes to franchise products by the franchisor will be better protected if the Franchise Agreement regulates specific protection of the suitability of the franchise object, and the franchise agreement is not made standardly by the franchisor but is formulated together with the franchisee. . Because standard agreements are more susceptible to taking sides for the unilateral benefit of the agreement maker.
 
 
 

Exposing Legal Pitfalls: Trademark Misuse in Franchise Agreements and Partnership Liability

The legitimate use of the trademark is performed by developing a license agreement containing the rights and obligations between the licensor and licensee. This license agreement is based on the principles of the consensus contained in contract law, namely the principle of good faith and freedom of treaty. In reality, some parties do not comply with these principles, causing disputes related to the rights and obligations of the parties, as well as license misuse. Therefore, this study aimed to analyze the trademark license arrangement and the form of legal liability for contract misuse in franchise system. Doctrinal or normative legal study methodswere used, with primary and secondary data obtained through interviews and literature review. As a civil law country, the regulation of trademark license agreements in Indonesia emphasized applicable policies to provide legal certainty. The results showed that the misuse of these agreements caused legal consequences for the offending party. These consequences included liability for aspects of franchise agreement violation, trademark infringement, as well as civil and criminal liabilities.

The Influence of Modern Market Development with the Franchise System Regarding the Development of Traditional Markets

Increased development in the economic sector has a positive impact on developments in the trade sector, one of which is the modern market with a franchise system, which has now spread to rural areas. The rapid flow of globalization has triggered a shift in the lifestyle of most people, especially the millennial generation, who no longer choose traditional markets. as a place to shop, they prefer shopping in modern markets. such as Indomart, Alfamart etc. which provide more attractive facilities and service methods than traditional markets. The management model used by mini market businesses is franchising orFranchise, things can be seen starting from business premises that have the same color and design, to the arrangement of goods and even the uniforms of the employees who serve buyers. The development of modern market businesses using the franchise model has a very significant impact on the lack of development of traditional markets if there is no regulation from the government as a policy maker, especially regarding permits for establishment. Limiting the number with a clear radius will be able to protect the sustainability of traditional markets, as well as the need to foster the development of traditional markets so that modern markets such as Indomart, Alfamart and others and traditional markets can run and develop in a balanced manner.

Оцінка вартості нематеріальних активів у системі франчайзингових відносин

The article is devoted to the assessment of the value of intangible assets in the system of franchise relations. The authors consider the theoretical foundation and methods of evaluation, in particular of trademark and know-how. Empirical analysis takes into account the value of physical and intangible assets, emphasizing the key role of the latter in the formation of competitive advantages. Particular attention is paid to factors affecting value, such as brand reputation and degree of innovation. The results of the article provide grounds for a conclusion about the effectiveness of franchising as a tool for business development and highlight the prospects for its further expansion in the context of market trends. The priorities of the application of approaches to the assessment of intangible assets and intellectual property objects have been systematized. A statistical assessment of the franchising market was carried out in 2018-2022. The article presents methodical approaches to the assessment of intangible assets. The authors unified the methods of estimating the value of intangible assets in franchising. Also, within the framework of the study, the main economic properties of intangible assets are outlined, in particular, they are: intangible nature, exclusivity and ownership rights, significance for business, validity period and limitations, cost and depreciation, preservation and management legal regulatory regime, etc. The authors focused attention on the aspect that assessing the value of intangible assets in franchise relations is a complex task that requires a comprehensive approach and consideration of various factors. The article emphasizes the aspect that the study of empirical aspects and the analysis of real scenarios will contribute to the further improvement of assessment methods and the expansion of understanding of the role of intangible assets in the franchising system.

The Dimensions of Entrepreneurial Orientation in Franchise Networks: Exploring the Role of Franchisee Associations

This study explores how a state-based franchisee association of a multinational quick-service restaurant franchisor introduced three world-first innovations through the activation of the five dimensions of entrepreneurial orientation (EO). The antecedents to this activation were also explored. A historical extended case study focusing on a revelatory case was undertaken. In-depth analysis using a rigorous qualitative methodology was facilitated by the triangulation of informant interviews, publicly available data, archival data, and artefacts. The three innovations explored involved the apparent activation of all five dimensions of EO by the franchisee association. The franchisee association’s structure and the provenance of its franchisee members, in being either externally recruited or internally recruited, appeared to have a bearing on whether product or process innovations were pursued. Five antecedents that enhance the propensity of franchisee associations to activate the dimensions of EO were also identified, and a preliminary model was constructed. Whilst the EO of franchisors and franchisees has previously been examined, this study is the first to explore franchisee associations as a vehicle for EO. With around 75% of franchisors incorporating some form of franchisee association, better understanding how to harness their innovative potential could bestow a competitive advantage upon those franchise systems able to do so.

Factors to Pay Attention to and Problems in Implementing a Franchise Business Agreement

The development of trade in the era of globalization is increasing rapidly, one way to improve people's welfare is to do entrepreneurship, because entrepreneurship will make society self-sufficient and with entrepreneurship will open opportunities for themselves and take advantage of the opportunities created. With a franchise system, franchisees only buy an existing business system and have the advantage that the buyer of the system does not need to start from scratch. Of course, to realize the franchise is marked with a franchise agreement in order to minimize future irregularities. This type of research method in writing is qualitative with the type of document. Qualitative research is a type of research whose results are not based on statistics or other calculations. The purpose of this writing is to find out the problems in implementing the rights and obligations of the parties to the agreement and what factors must be considered by the parties outside the script in implementing the franchise agreement.

Franchise Protection Law to Secure Rights and Obligations in Joint Business

Franchise business (franchise) is a business system that is currently favored by many people. From the franchise system, doing business becomes easier, because franchising is the right of each entrepreneur or business entity to market goods or services that are proven by the running of a "successful" business by being used by other parties based on a franchise agreement. Here the author wants the parties to pay close attention to the information discussed in connection with the franchise agreement. The parties are responsible for all the contents of this information and prevent its dissemination or leakage to third parties or the public, because that is why it is important to include a confidentiality clause in the franchise agreement so that the information obtained is safeguarded and does not result in loss to the owner due to information leakage. In the franchise business, the law of protection for every profit is needed as regulated in the Government Regulation of the Republic of Indonesia Number 42 of 2007 which regulates Franchising and is further regulated by the Regulation of the Minister of Trade of the Republic of Indonesia Number 53/M-DAG/PER/8/2012 concerning the Implementation of Franchising

Research on Factors Affecting the Intention to Maintain a Long-Term Relationship in Franchising in Vietnam

Purpose: This study examines the factors in franchising that influence satisfaction and intention to maintain a long-term relationship. Theoretical framework: This study applies the theory of consumer behavior to prove that the factors of cooperation, support, trust, commitment, brand value, and commitment are the factors that affect customer satisfaction through table design. Design/Methodology/Approach: This study obtained 386 valid answers that were coded and cleaned using SPSS and AMOS software, after cleaning and coding, the reliability test, exploratory factor analysis, and confirmatory factor analysis were carried out to determine CFA and test the SEM hypothesis. Findings: This study shows that four independent factors are trust, cooperation, brand value, and cost, which are factors that indirectly affect the intention to maintain the relationship in franchising, franchise through the intermediate variable is satisfaction. Research, Practical & Social implications: This study proposes a number of governance implications to increase the intention to maintain the franchisor-franchise relationship. Originality/Value: This study examined the factors that indirectly affect the intention to maintain the relationship in the franchise system through the mediating variable. At the same time, the study also tries to clarify how the influence of the identified factors has an indirect effect on the intention to maintain a relationship in the franchise.

The role of ICTs for knowledge sharing in franchising networks

PurposeDespite the significance of knowledge sharing for competitive advantage in networked businesses like franchising systems, there is a lack of comprehensive understanding regarding the strategic value of knowledge sharing in the context of franchising. In particular, the specific contribution of information and communication technologies (ICTs) in facilitating interorganizational knowledge exchange among franchising members remains inadequately understood, particularly in emerging economies. Therefore, this study aims to explore the mechanisms involved in the knowledge-sharing process facilitated by a virtual learning environment (VLE) within franchising networks and examine the role of VLEs in facilitating knowledge.Design/methodology/approachThis study uses a multiple-case study approach involving 24 franchisees and the franchisor within a Brazilian franchising network operating in the furniture market to examine the role played by a VLE.FindingsThe results of the study reveal that the introduction of a VLE has played a significant role in fostering enhancements in the knowledge-sharing process among the franchisor and franchisees in the network. Moreover, the results indicate that VLEs play a significant role in overcoming geographical obstacles, thereby enabling efficient knowledge sharing between franchisees and franchisors operating in extensive territorial contexts. Finally, findings indicate that intracommercial competition acts as a prominent barrier, leading to low levels of cooperation and knowledge-sharing intent among franchisees within the network.Originality/valueThis study contributes to the existing knowledge by enhancing the understanding of how ICTs can facilitate knowledge sharing in organizations operating within franchising systems. Furthermore, this paper advances the comprehension of the role of networking franchising configuration and governance in supporting organizational improvements. Additional actionable insights are provided.

The Eastern Cape and East London: African Protest and the Historical Context of Bloody Sunday 1952

This concluding overview explores themes which provide background to the four articles in the part special issue on popular protest in the Eastern Cape, with a special focus on East London. As these articles demonstrate, East London became the site of some of the most explosive urban popular protest in South Africa from 1950 to 1952. First, we discuss distinctive features of Eastern Cape African history over the long term. Society in the Eastern Cape was shaped by a particularly violent and protracted colonial conquest, lasting a century, but also by an early and widely dispersed missionary presence and relatively incorporative franchise system. Both left deep legacies. Second, we focus on East London, and some social characteristics that underlay the protests of the 1950s. Despite control by an anglophone white elite, the City Council was strongly committed to segregation and conditions in the ‘locations’ were among the worst in South Africa. This helped to radicalise African urban communities who also united to a degree behind Africanist, rather than class or worker-based, ideas and rhetoric. Third, we discuss participation by women in movements of popular protest in the Eastern Cape, focusing on both rural and urban contexts. Women were deeply engaged in two periods of militant mobilisation in East London: from 1929 to 1931, led by the Independent Industrial and Commercial Workers’ Union (IICU) and 1950 to 1952, led by the ANC Youth League. The relationship between political radicalism and spiritual renewal is also briefly discussed. This overview suggests that all three of these historical processes shaped the ideas, patterns, and radicalism of popular protest in early 1950s East London.

Performance of knowledge transfer mechanisms: The case of franchising networks

Franchisor’s system knowledge is considered one of the most important resources for achieving competitive advantage in franchise networks. Although franchisors use a variety of knowledge transfer mechanisms, such as training, intranet, video conferences, manuals, and emails, to transfer the system knowledge to their local franchise partners, previous research has not investigated the performance outcomes of the different knowledge transfer mechanisms in franchising networks. In this study, we address this research question by examining the impact of various knowledge transfer mechanisms on franchise network performance using primary data collected from 168 franchise systems in four Central European countries. Based on the application of PLS-SEM methodology, our findings highlight that high information-rich knowledge transfer mechanisms (training, meetings, visits, video conferences) increase performance by facilitating the transfer of tacit system knowledge, while IT-based knowledge transfer mechanisms (emails, instant messages, intranet, and social media) increase performance by facilitating the transfer of explicit system knowledge. We contribute to the franchise literature and the knowledge management of franchising networks by showing that superior network performance requires co-location between the tacitness of system knowledge and information richness of knowledge transfer mechanisms.

ANALISIS KEPUASAN KONSUMEN PADA TOKO MU (STUDI KASUS PADA PEGAWAI UNIVERSITAS MUHAMMADIYAH KOTABUMI)

Minimarkets are a place to buy basic necessities. Some people prefer to shop at minimarkets because, apart from being easily accessible, they are also a place to shop that is considered quite comfortable. Seeing this opportunity, the North Lampung Muhammadiyah regional leadership also established a minimarket with the Toko MU brand. However, the service at Toko MU is considered to be still not good when compared to other minimarkets, especially minimarkets with a franchise system. The aim of this research is to analyze the level of consumer satisfaction at Toko MU based on service, price, product, and store access factors to find out what attributes are priorities. improving customer satisfaction at MU Stores and providing suggestions for priority improvements for MU Stores to increase customer satisfaction. The method used is a quantitative method. Data was collected using a questionnaire, and data measurement used a Likert scale. The number of respondents was 100, who were consumers at the MU Store located in the Muhammadiyah University Kotabumi area. This research uses the Customer Satisfaction Index (CSI) data analysis method, with the level of consumer satisfaction being "quite satisfied", and there are 7 attributes that need to be improved by Toko MU. In further research, it is hoped that other aspects of the discussion will be added.