Abstract
Franchising is fast becoming a dominant model of business throughout the world, and the current study adds to a growing body of literature surrounding product or trade name franchising by examining the non-financial value of the franchise brand as perceived by potential, current and ex-franchisees. Two franchise brand cases in the home services industry are examined and the study uncovers some key value-related consideration factors for franchisees before, during and after their involvement with a business. Major findings highlight the importance of the start-up package offered to potential franchisees in terms of training and guaranteed support mechanisms, and show that the key to maintaining ongoing commitment from franchisees tends to centre on management of the brand and the relative power of the brand within the industry as a whole. A conceptual model for franchise perceptual equity is thus detailed in relation to these findings.
Similar content being viewed by others
References
Aaker, D. (2003) The power of the branded differentiator. MIT Sloan Management Review 45 (1): 83.
Achrol, R.S. (1996) The franchise as a network organization. In: A. Dugan (ed.) Paper presented at 10th Annual Society of Franchising Conference, Honolulu, USA.
Adams, J. (1963) Towards an understanding of inequity. The Journal of Abnormal and Social Psychology 67 (5): 422–436.
Baron, S. and Schmidt, R.A. (1991) Operational aspects of retain franchisees. International Journal of Retail and Distribution Management 19 (2): 13.
Combs, J. and Ketchen, D. (1999) Can capital scarcity help agency theory explain franchising? Academic Management Journal 42 (2): 196–207.
Combs, J., Ketchen, D. and Hoover, V. (2004) A strategic groups approach to the franchising-performance relationship. Journal of Business Venturing 14 (1): 35–67.
Elango, B. and Fried, V.H. (1997) Franchising research: A literature review and synthesis. Journal of Small Business Management 35 (3): 68.
Falbe, C.E. and Welsh, D.H.B. (1998) NAFTA and franchising: A comparison of franchisor perceptions of characteristics associated with franchisee success and failure in Canada, Mexico, and the United States. Journal of Business Venturing 12: 151.
Gummesson, E. (2001) Are current research approaches in marketing leading us astray? Marketing Theory 1 (1): 27.
Harmon, T. and Griffiths, M. (2008) Franchisee perceived relationship value. Journal of Business and Industrial Marketing 23 (4): 256–263.
Hunt, S.D. (1977) Franchising: Problems, promises, prospects. Journal of Retailing 53 (Fall): 71.
Knight, R.N. (1986) Franchising from the franchisor and franchisee points of view. Journal of Small Business Management 1 July: 8.
Laurenceson, J. (2007) Financial sector regulation, bank franchise values and savings mobilisation. Applied Economics 39 (4): 519–525.
Leuthesser, L. (1988) Defining, measuring and managing brand equity. A Conference Summary. Cambridge, MA: Marketing Science Institute.
Mintzberg, H. (1979) An emerging strategy of ‘direct’ research. Administrative Science Quarterly 24 (4): 582.
Peterson, A. and Dant, R.P. (1990) Perceived advantages of the franchise option from the franchisee perspective: Empirical insights from a service franchise. Journal of Small Business Management 28 (3): 46.
Rubin, P.H. (1978) The theory of the firm and the structure of the franchise contract. Journal of Law and Economics 21 (1): 223.
Treynor, J (1999) The investment value of brand franchise. Financial Analysts Journal 55 (2): 6.
Weaven, S. and Frazer, L. (2006) Investment incentives for single and multiple unit franchisees. Qualitative Market Research 9 (3): 225.
Wood, L. (2000) Brands and brand equity: Definition and management. Management Decision 38 (9): 662.
Yaniv, E. and Farkas, F. (2005) The impact of person-organization fit on the corporate brand perception of employees and of customers. Journal of Change Management 5 (4): 447–461.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Leslie, T., McNeill, L. Towards a conceptual model for franchise perceptual equity. J Brand Manag 18, 21–33 (2010). https://doi.org/10.1057/bm.2010.17
Received:
Revised:
Published:
Issue Date:
DOI: https://doi.org/10.1057/bm.2010.17