Conflict Aftermath: Dispute Resolution and Financial Performance in Franchising

Wang, Jeff Jianfeng; Grünhagen, Marko; Ji, Li; Zheng, Xu

doi:10.1016/j.jretai.2020.03.001

Cited by 16 publications

(18 citation statements)

References 52 publications

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“…Especially, Badrinarayanan et al (2016) stress that the cultivation of a brand-centric relationship is vital for the success of the franchising system because brand equity is highly related to the profitability for both franchisors and franchisees [9]. Specifically, franchisees enter the franchise network to benefit from the franchise chain's brand equity whereas franchisors expect to gain from the royalty fees from franchisees in exchange for their use of brand equity [10,11]. Accordingly, two parties need to share the responsibility to manage brand equity as an intangible resource and cooperate to gain more profitability [12].…”

Section: Introductionmentioning

confidence: 99%

“…As the Korean franchise industry is rapidly developing in East Asia, it will be a good research setting to study the sustainability of franchise chains [16,17]. Unlike extant research focusing on the only franchisors' performance (e.g., Wang et al, 2020), this research analyzes a separate set of information as the financial performances of franchisors and franchisees [11]. It would allow us to examine how franchisors and franchisees are influenced differently by channel intensity, or advertising and promotional activities.…”

Section: Introductionmentioning

confidence: 99%

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Effects of Marketing Decisions on Brand Equity and Franchise Performance

2021

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The purpose of this study is to provide a way of pursuing a balanced profitability between franchisors and franchisees leading to the sustainability in franchising. Based on a belief that the formation of brand-centric relationship is vital for the success of franchising system, we constructed a model that examines the relationships between marketing decisions, brand equity, and the financial performances of franchisors and franchisees. We used actual data of the Korean franchise chains, including measures of channel intensity and advertising and promotional activities as franchise marketing decisions as well as the profitability of franchisors and franchisees for the analysis. The results of analysis show that while advertising and promotion expenditure has a positive impact on the performances of both franchisors and franchisees, the number of stores does not influence them in the same way. This indicates that their interests may conflict. This study suggests that marketing decisions can be utilized as a means of achieving balanced profitability that would benefit the sustainability in franchising between franchisors and franchisees.

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Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Effects of Marketing Decisions on Brand Equity and Franchise Performance

2021

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“…30 % des litiges liés aux affaires aux États-Unis concernent la franchise (Wang et al, 2020). Beaucoup se règlent par médiation ou arbitrage.…”

Section: Une Relation Agonistiqueunclassified

Essai d’une phénoménologie de la franchise

Ayache¹,

Dumez²

2022

Annales Des Mines - Gérer Et Comprendre

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La franchise est une relation économique entre deux acteurs indépendants, le franchiseur et le franchisé. À ce titre, elle se prête bien à l’application de modèles économiques (théorie de l’agence, théorie des contrats incomplets, coûts de transaction, etc.) ou gestionnaires (théorie des parties prenantes, empowerment , gestion de la créativité, etc.). Mais Dant (2008 ; Dant et al. , 2011) a fait remarquer que l’on manquait d’une véritable phénoménologie de cette relation complexe. Cet article tente de produire cette phénoménologie sous la forme d’un étagement ordonné de descriptions : une description minimale (une relation économique entre deux agents qui chacun y trouvent son intérêt), puis des éléments de complexification (une relation économique déséquilibrée, autre qu’économique, multi-niveau, en réseau, agonistique). Enfin sont identifiés les scénarios dynamiques de la relation de franchise.

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“…In another study on the regulatory environment in Taiwan, Chu et al (2016) conclude that regulation enhances M&As in the banking sector by improving corporate governance codes. The regulatory context also has been shown to impact franchised businesses and their performance (e.g., Wang et al, 2020). Federal regulation by the FTC mandates that franchisors provide FDDs only to potential franchisees two weeks prior to contract signing.…”

Section: Theoretical Framework and Development Of Hypothesesmentioning

confidence: 99%

The impact of pre-contract disclosure on M&A performance in franchising

Grünhagen

Sadeh

2021

Journal of Inter-Organizational Relationships

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The franchise sector represents a unique opportunity to investigate pre-contract disclosure by target firms in mergers and acquisitions (M&As) due to the legal framework within which franchises operate. This study examines the role of Franchise Disclosure Documents (FDDs) as in-depth resources in cases in which franchise firms are M&A targets. Data were collected from 517 M&As in the US over a 20 year period (1999)(2000)(2001)(2002)(2003)(2004)(2005)(2006)(2007)(2008)(2009)(2010)(2011)(2012)(2013)(2014)(2015)(2016)(2017)(2018) in the restaurant industry. The results show that franchise disclosures' effect on alleviating ex-ante information asymmetry is significant when a higher level of information asymmetry between the parties exists, i.e., when they are farther apart geographically, or if their initial business sector is different from that of the target firm. The study's implications regarding proprietary information disclosure for franchisors that may represent likely M&A targets are discussed.

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Conflict Aftermath: Dispute Resolution and Financial Performance in Franchising

Cited by 16 publications

References 52 publications

Effects of Marketing Decisions on Brand Equity and Franchise Performance

Effects of Marketing Decisions on Brand Equity and Franchise Performance

Essai d’une phénoménologie de la franchise

The impact of pre-contract disclosure on M&A performance in franchising

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