Franchise system has been popular in Korea since 1990s. Recently, reflecting the change in the consumption patterns of Korean families and the expansion of global franchising system, the sales and the number of franchise store are soaring. Contrary to...
Franchise system has been popular in Korea since 1990s. Recently, reflecting the change in the consumption patterns of Korean families and the expansion of global franchising system, the sales and the number of franchise store are soaring. Contrary to the enlarged franchise market in Korea, the research dealing with the Korean franchise system is rare.
The purpose of this study is to identify the performance determinant factors and the satisfaction reinforcement factors of the franchise stores through an empirical investigation. First of all, this study focused on a conceptual model for franchisee's recontract intention and developed a causal model dealing with store performance, franchisee's satisfaction and recontract intention.
Based on the findings in the past research, we have identified a variety of antecedents for the franchise store performance and satisfaction. The determinant variables of performance can be grouped into five major categories such as franchisor characteristics, franchisee characteristics, relationship characteristics between franchisor and franchisee, customer characteristics, and competition characteristics. Also, the determinant variables of satisfaction were grouped into three major categories such as franchisor characteristics, franchisee characteristics, relationship characteristics between franchisor and franchisee.
The data for the empirical analysis were collected through survey questionnaire and personal interviews and 187 store owners were participated in the study. After an initial data recording, 35 questionnaires were deleted from the data set because of missing answers. Finally, the sample data of 152 questionnaires were used for the statistical analysis. Using SPSS WIN 10.1, an exploratory factor analysis was performed. In order to test the hypotheses from the causal model, the LISREL 8.52 program was employed.
The results of the statistical analysis were as follows. First, the recontract intention is influenced by franchisee's satisfaction and performance. Second, the store performance is related with franchisee characteristics and competition characteristics. Third, the franchisee's satisfaction is related with franchisor's business support activities and franchisor's logistics support activities and performance. Mostly, the results support the past research. However, this study proposed an integrated causal model and tested the model empirically. Even though there are several limitations, this study contributed both academics and practitioners to improve the understanding of the franchise store management in Korea.