International master franchise agreements

Abstract

Purpose -This paper examines the inter-organisational processes used to control international master franchise agreements from operational, relational and evolutionary perspectives.Design/methodology/approach -The research is undertaken through a qualitative, in depth case study in the international hotel industry. The case comprises an international master franchise agreement between a large US-based hotel franchisor and its European master franchisee. Findings -The study identifies the inter-related nature of operational and relational control processes and how these evolve over the life of a master franchise agreement. It reveals how the perceptions of franchise members serve to enhance or inhibit the development of relational norms and how these, in turn, impact on the predominant type of control and the specific inter-organisational processes employed.Research Limitations -The research is based on a single in-depth case study within one industrial context and the universality of the findings may therefore be limited.Practical Implications -The paper offers insights to managers of international master franchise agreements on the interaction between members' perceptions, relational norms developed and the inter-organisational processes used to control the agreement. It also reveals how the use of contractual controls can inhibit the development of relational norms and negatively impact on relationships between franchisors and master franchisees. The findings presented may have relevance to managers of other types of international alliance agreements.Originality/value -By drawing on both the alliance and franchise literature and employing a qualitative approach, the study helps to close a gap in the current international franchise literature through the identification of specific inter-organisational processes for control within international master franchise agreements, how these evolve in respect of relational norms and how these are underpinned by perceptions of franchisor and franchisee members.

Factors influencing relationship development in franchise partnerships

“…Furthermore, it examines relationship development within two types of franchise agreements, direct and master franchising. International master franchise partnerships are growing in popularity, particularly within the service industries ( Brookes and Roper, 2008 ). They differ from individual franchise agreements as they entitle the franchisee the rights to open franchised units and to grant these rights to third parties as a sub‐franchisor (Connell, 1999; Quinn and Alexander, 2002).…”

“…They differ from individual franchise agreements as they entitle the franchisee the rights to open franchised units and to grant these rights to third parties as a sub‐franchisor (Connell, 1999; Quinn and Alexander, 2002). As such, the greater degree of control devolved to the master franchisee (Brookes and Roper, 2008), may impact on relationship development.…”

Analysis on the impact of dynamic innovation investment strategy of green supply chain enabled by blockchain

“…Alongside this, strategic alliances have become increasingly common in the green supply chain system. Strategic alliance cooperation typically involves both horizontal and vertical alliances ( Brookes & Roper, 2011 ; Gassenheimer, Baucus & Baucus, 1996 ; Boyle et al, 1992 ; Dant & Schul, 1992 ). Horizontal alliance is when two platforms work together to decide on investment strategies and blockchain technology in order to limit competition and maximize joint profits.…”

Strategic Interactions in Franchising Systems When Anticipating Innovation: How to Develop Operational Strategies and Cooperative Alliance Models?

“…The choice of cooperative alliance model is one of the key factors for the successful operation of franchise system members [25], [26]. These include horizontal alliances (where franchisors and franchisees work together to develop operational strategies) [27], [28] and vertical alliances (where franchisors and franchisees work together) [29], [30]. Different cooperative models can provide different support and resources, such as brand promotion, advertising hitchhiking, and market development [26].…”