Research Note: Trade Name Franchise Membership as a Human Resource Management Strategy: Does Buying Group Training Deliver ‘True Value’ for Small Retailers?

Abstract

Human resource management (HRM) is an important source of competitive advantage. However, recent reports document that HRM, and in particular employee training, is less likely to occur in small firms. One possible remedy of special interest to small retailers is trade name franchise membership. Trade name franchises, or buying groups, claim to offer small firms advantages not otherwise realizable, including bulk buying discounts, brand name recognition and workforce training. We report results from our study of over 300 small and medium-sized hardware stores, which tested the effects of employee training and trade name franchise membership, on small firm performance. Trade name franchisees achieve higher mean performance; however, the contribution to performance made by franchisees’ training does not appear to be significantly better than that of independent stores.

Evaluating the Impact of Different Training Methods on SME Business Performance

“…Cassell et al (2002) suggested that training is offered to provide a tactical solution to business problems, whilst Patton and Marlow (2002) posited that training demand is explicitly linked to improving the business operation, thus improving effi ciency, reducing costs, and improving knowledge regarding protocols. Hence, employee training is generally accepted as a mechanism to enhance SME business performance (CEDEFOP, 2011) through better profi tability and productivity (Chandler and McEvoy, 2000;Litz and Stewart, 2000;Reid and Harris, 2002), organisational performance and capabilities (Chandler and McEvoy, 2000;DeSimone and Harris, 1998;Kotey and Folker, 2007), business survival (Ibrahim and Ellis, 2003;Marshall et al, 1995), and growth (CEDEFOP, 2011;Cosh et al, 1998). Kroon and Moolman (1992) noted that training can assist SMEs in problem solving, which would potentially reduce costs and increase profi tability and knowledge of relevant legislature and enhance operational effi ciency.…”

Single‐ and Multiple‐Informant Research Designs to Examine the Human Resource Management−Performance Relationship

“…Description of the approach Studies Approach 1 Single informant: a single informant with a different position in each unit of analysis provides answers to all questions in the questionnaire, and no differentiation is made between them in the analysis Audea, Teo and Crawford (2005), Chen and Huang (2009), Delaney and Huselid (1996), De Winne and Sels (2010), Fey and Björkman (2001), Fey, Björkman and Pavlovskaya (2000), Gerhart and Milkovich (1990), Ghebregiorgis and Karsten (2007), Gibson et al (2007), Guest et al (2003), Guthrie (2000Guthrie ( , 2001, Harel and Tzafrir (1999), Iverson and Zatzick (2011), Kalleberg and Moody (1994), Kepes, Delery and Gupta (2009), Kintana, Alonso and Olaverri (2006), Lee and Chee (1996), Li (2003), Litz and Stewart (2000), McClean andCollins (2011), Miah andBird (2007), Minbaeva et al (2003), , Perry-Smith and Blum (2000), Rodwell and Teo (2008), Shih, Chiang and Hsu (2006), Skaggs and Youndt (2004), Tzafrir (2005aa, 2005bb), Vlachos (2008), Wood, Holman and Stride (2006) (N = 32) Approach 2…”

Best fit, best practice, or stuck in the middle? The impact of unit ownership on unit HR performance in franchise systems

“…Even though there are numerous studies on HRM and performance in a range of organizational contexts, very few studies have empirically investigated how franchisors and franchisees apply HRM (exceptions are Krueger 1990;Litz and Stewart 2000;Felstead 1993 andTruss 2004), and, to our knowledge, studies linking HRM to performance in a franchise context are even more rare (two exceptions are Grünhagen et al 2013). The study of franchisee HRM behaviors and their impact on performance is important since franchisees generally have a large degree of freedom in adopting HR practices in their units.…”