Franchisee perceived relationship value

2008

The business to business (b2b) relationship literature shows that the features of business relationship such as control, support, cooperation and power act a little differently in franchise business. Information on, and identification of the actions in the franchise business relationship, that can increase or diminish trust and commitment between both partners, is also scarce. Furthermore, how can these actions contribute to, solidify relationship; attaining over all business development, adding value, achieving synergy, and competitive advantage? This paper will briefly review literature on the relationship of the franchisor and franchisee, investigating its elements, actions that deteriorate it and providing a background that how and why the conflicts occur. From this it will is hypothesised that certain actions of the parties in relationship and suggest a generic conceptual model that be adopted and applied by both partners in order to increase cooperation and work together for over all business growth. This will help to add value, achieve competitive advantage and growth. This model could be applied in any environment. This paper will act as catalyst for development of a model for franchise business introduction and growth in CIS.

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information.

Iranian Journal of Management Studies, 2017

The Nigerian franchise sector witnessed a rapid growth at the turn of the century, from 2001 to 2010, and thereafter started declining. Disputes, relational conflicts, and high rate of outlets closure have characterized the industry over the years. Meanwhile, studies show that to a large extent, success of franchisees depends on the quality of relationship they have with their franchisors. No prior empirical study has investigated the cause of the increasing relationship disputes in the Nigerian franchise industry. This investigation aims to explore the key relationship factors that influence franchisees' overall satisfaction and intention to stay. Personal interview involving 26 franchisees was used to collect data from different franchise brands across Nigeria. Four factors emerged strongly as the antecedents of the relationship problem in the franchise system. Answering the calls of many scholars for studies in different cultures and settings on franchisor-franchisees relationship, this study provides the first-ever empirical insights into the relationship dynamics between franchisors and franchisees in Nigeria, thereby helping to strengthen the theory in the subject. The study offers some recommendations that will potentially help in reviving the industry for the benefit of the stakeholders and the economy at large.

2016

Franchising is an increasingly popular way of conducting and expanding business in the global environment. In a franchising business, the franchising relationship quality is considered important in ensuring success, since franchisors-franchisees are considered as business partner. Studies on franchisee-franchisor relationships from the franchise perspectives are very important and there has been a lack of research on the franchisee motivations for entering into the relationship mainly from Malaysia context. Therefore, this study will attempt to examine the relationship between relationship value, relationship quality and loyalty among Malaysian franchisees. A total of 400 questionnaires were mailed by using random sample to a local-home grown franchisee. The result of this study expects to develop an understanding of relationship quality among Malaysian local home grown franchisees. This study also contributes to the field of relationship marketing especially in managing business-to...

2013

The concept of relationship quality evolved from relational marketing theory, and provided the impetus for a paradigm shift from transactional relationships to more cooperative and service-centred relationships in business-to-business processes. In the marketing literature, relationship quality has been considered a key component in relationship marketing and business-to-business relationship exchange such as buyer-seller, exporter-importer and franchisor-franchisee. In franchising, the key to a successful franchise system is dependent on the effectiveness of franchise relationship management where both parties are characterized by mutual interdependence and cooperation. Despite the importance of this topic in franchising, very little is known about how to develop effective franchisor-franchisee RQ and how it impact performance/loyalty. Therefore, this paper investigates relationship quality in franchise networks towards the firms’ performance and loyalty from a franchisee‘s percept...

Service Business, 2011

The business model that has grown the most and has been the most successful worldwide 4 in recent decades is franchising due to its considerable increase in the commercial 5 distribution area, and to the constant increase in franchisors and franchisees in both 6 developed and developing countries (Rondán et al., 2007). Nonetheless, the decision to 7 adopt the franchise system requires the careful analysis of various aspects such as staff 8 selection, location, etc. (Forward and Fulop, 1993). 9 Research into franchise relationships generates two groups: those that 10 qualitatively focus on dyadic relationships from the agents' organizational viewpoint and 11 those that attempt to quantify the exchanges taking place in the relationship by means of 12 a franchising contract with empirical studies. As part of these exchanges, the franchisor 13 enables the brand name and a series of intangible assets to be exploited in exchange for 14 an upfront fee and periodic payments paid by the franchisee. In light of this, Álvarez 15 (2007) defined the franchising chain as intensive businesses in intangible assets that do 16 not deteriorate with use and which are hard to commercialize. This research presented 17 here is within the context of empirical research studies into franchising relationships. 18 Pioneering studies on franchising focused on analyzing the indicators of the 19 franchise value, such as those of Baucus et al. (1993) carried out on franchises in the US. 20 These authors determined the influence of the firm's age, its presence in the market and 21 growth in the number of franchises in terms of upfront fees and royalties. These drivers have been considered by several studies analyzing the firms´ propensity to franchise. 1 (Gillis and Castrogiovanni, 2010). Later research looked deeper into the many aspects 2 that intervene in the relationship, which is based on cooperation rules, information 3 exchanges and the continuity of the relationship (Bordonaba and Polo, 2003) and evolves 4 throughout its life cycle (Blut et al, 2010). Whatever the degree of the relationship's 5 orientation, the franchisee's trust in the franchisor is essential for a satisfactory 6 relationship to emerge (Bordonaba and Polo, 2008), as is partner commitment (Fernández 7 and Martín, 2006). Moreover, franchise business formats must develop to consider the 8 capabilities and intentions among participating stakeholders (De Castro et al., 2009). The 9 organisational drivers should be considered as a main issue in the franchise selection 10 decision process (Altinay and Okumus, 2010). Indeed, the greater the complexity of the 11 knowledge transmitted, which is measured by the number of services the franchisor 12 provides to the franchisee, not only when the activity commences, but also as long as the 13 relationship lasts, the more it helps to develop business and to make the system more 14 efficient (Minguela-Rata et al., 2009). 15 However, conflicts can emerge in this relationship, known as the channel conflict 16 derived from the franchisors' need to control their franchisees, and from their authority as 17 legally independent businesspeople. Another emerging conflict is the territorial 18 encroachment-related conflict, which takes place when new franchisees appear to 19 compete with and encroach on already existing ones. The latter may even offer positive 20 value to not only the franchisor when an exclusivity clause is included in the contract, but 21 also to the franchisee by purchasing this exclusivity (Nair et al., 2009). Likewise, this 22 competence among franchises means their numbers increase, which lowers their incomes, 23 and this gives rise to a negative relationship between the royalties and the number of 1 franchises (Chu and Liu, 2003). 2 Whereas the upfront fee tends to be a set amount, royalties are normally 3 calculated as a percentage of the franchisee's sales or profits as profit sharing between the 4 franchisor and the franchisee (Combs and Castrogiovanni, 1994). Whereas sales-based 5 royalties are a widely used system in the USA, systems based on profit margins are more 6 frequently used in countries like Japan, and may lead to lower prices, more sold amounts 7 and more profit in the channel (Jeon and Park, 2002). In some countries, however, 8 royalties are set as flat rate continuing franchise fees (Frazer, 1998), as in the case of 9 Australia, which means that the franchisor makes less effort in helping his or her flat fee 10 franchisors invest less effort in monitoring their franchisees. 11 Other aspects which affect the value of royalties and upfront fees are each 12 country's legislation (Brickely, 2002), the sectors and the degree of franchising maturity. 13 Therefore, Bordonaba et al. (2008) observed higher franchise fees and royalties in the 14 restaurant business sector than in the fashion sector, and also a greater expansion of the 15 newer franchises going through a stage of more rapid growth. 16 Harmon and Griffiths (2008) considered that the relational equity and social 17 exchange theories were relevant to support the relational value perceived in franchising. 18 That is, relationships must be based on the mutual franchisor-franchisee benefit and on 19 the balance between the inputs and outputs that this exchange generates. Thus, the 20 upfront fee represents not only the relational value perceived by the franchisor through 21 tangible and intangible benefits, but also the expenses incurred while the relationship

2010

The concept of relationship quality (RQ) evolved from relational marketing theory, and it provided the impetus for a paradigm shift from transactional relationships to more cooperative and service-centered relationships in business-to-business (B2B) processes. While RQ is a major trend in business management, considerable confusion and disagreement persist regarding what constitute the dimensions, outcomes and impacts of RQ. This paper looks at RQ from the perspectives of B2B, particularly in franchising. A meta-analysis of the literature on the subject is undertaken to ascertain how RQ has been conceptualized, in terms of its dimensions, and impact on business performance.

Franchise as business method especially popular become in second half od 20th century (Khams, 2013.,78).Since than as a signii cant factor in business growth and lever of economic development attracts researches attention. In contest of franchise way of doing business, relation between franchisor and franchisee is crucial for success, not only for the individual member of franchise but for entire franchise system. Franchise relationship actually begins with meeting the needs of clients through cooperation of franchisor and franchisee. Each party is directly interesed in success of franchise. e element that varies franchise from most other forms of business is a symbiotic relationship of interdependence and conn dent of two legally dii erent economic. In focus of this research is franchisee satisfaction as a aquire of the right of represenatation – contractor of the franchise agreement, franchi-see as a member of distribution system and franchisee as individual that experience franchise as satisfaction for invested ee orts, knowledge and money. Research uses scientii cally verii ed questionnaire of four university teachers (Abdullah and other.,2008) satisfactory internal consistency (= 0,87). Questionnaire contains ve dimensions of franchisees satisfaction: 1) social interaction, 2) service support , 3) nancial, 4) assurance and 5) competence. Contains a total of 23 particles. Recearch is conducted between owners of the right of represenatation (dealers) and managers on the highest and middle level, employed in ten various automotive sales and service representative (ten dii erent principals) in the area of Republic Croatia. After nal analysis of the data obtained through the SPSS software package are discussed factors aa ecting the franchisee satisfaction. Also regression analysis indicates that the relationship between competitive position and its franchisee satisfaction shows meaningful, signii cant and consistent relationship.

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information.

This paper aims to establish the relationship between the antecedents of trust, trust itself, and franchisee satisfaction. Taking its cue from power-dependence, international business, and social exchange theories, the paper contributes to the franchise literature by offering a more comprehensive theoretical perspective to aid understanding of trust development in and satisfaction with franchise partnerships. Drawing on a multi-sector survey of Turkish franchisees, the study provides empirical evidence of the impact of the franchisors' role performance and cultural sensitivity on franchisees' trust in and satisfaction with franchise partnerships. Furthermore, this research demonstrates the central role of communication in the development of franchisees' trust.