The dark side of multi-unit franchising: The drawbacks of local responsiveness

Andrey Kretinin, Todd Morgan, Sergey Anokhin

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

In attempting to solve agency issues associated with single-unit franchising and international adaptation issues with company-owned outlets, franchisors engage in multi-unit franchising. Extant research has examined the antecedents and positive outcomes of multi-unit franchising, but the dark side has largely been neglected. In a sample of 16 corporations that operate 25 brands from the period of 2005-2012, we examine how the density of multi-unit franchising impacts overall franchise system growth and internationalization growth. The results of our study show that multi-unit franchising negatively impacts franchise system growth and a franchise system's internationalization efforts. While benefits of multi-unit franchising have been explicated by previous research, our results show that companies should be concerned about the long-term impact of multi-unit franchising and that there is indeed a dark side.

Original languageEnglish
Title of host publicationOrchestration of the Global Network Organization
PublisherEmerald Group Publishing Ltd.
Pages263-281
Number of pages19
ISBN (Print)9781783509539
DOIs
Publication statusPublished - 1 Jan 2014
Externally publishedYes

Publication series

NameAdvances in International Management
Volume27
ISSN (Print)1571-5027

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Keywords

  • Franchise internationalization
  • Integration- responsiveness
  • Multi-unit franchising

ASJC Scopus subject areas

  • Business and International Management

Cite this

Kretinin, A., Morgan, T., & Anokhin, S. (2014). The dark side of multi-unit franchising: The drawbacks of local responsiveness. In Orchestration of the Global Network Organization (pp. 263-281). (Advances in International Management; Vol. 27). Emerald Group Publishing Ltd.. https://doi.org/10.1108/S1571-502720140000027029