• Asia-Pacific Journal of Business
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• v.10 no.2
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• pp.65-77
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• 2019

The after China's reform and opening up, the country has been facing the era of material abundance based on its economic power. The Chinese food industry has been growing along with economic growth, high quality, and diversified customer needs. Also, as Chinese people have strong attachment to food, many food franchise companies have been also growing rapidly. As the Chinese government encourages and supports the field of food franchises, so that the quality and quantity of the Chinese restaurant industry have been improved largely. Meanwhile with the support of the Korean government to enter the overseas market, the number of Korean franchise companies are increasing to operate their business in China. Under the influence of Chinese food industrial climate, Korean companies are also in search of global market advancement to China. However, the risks in China are unexpectable, which means that the recent move of China is literally showing rugby action, criticism of operating businesses in China has been climbed up and the domestic SMEs are seriously considering whether to stay or leave. This study investigates the environmental risks of Chinese enterprises, in which the food franchise companies could experience, to manage any risks from entering the Chinese market with uncertainty. Through SWOT analysis and cases, strategies to avoid the risks are suggested for Korean companies to enter the Chinese markets. Therefore, this study researches in the current status of Chinese and Korean restaurants, explores any risks in China in terms of exports to China and market advance, develops strategies to avoid those risks, and provides essential suggestions for entering into Chinese market.

• The Journal of Industrial Distribution & Business
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• v.3 no.2
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• pp.17-21
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• 2012

Purpose - The objective of the paper is to explain the factors affecting on the Re-contract intension of franchisor in the uprising Chinese franchise market. Research design, data, methodology - The study conducted a survey on the 400 franchisors data in China from January to July 2012. By AMOS analyzing the data to examine these hypotheses empirically, we can confirm most hypothesis supposed. Results - This study shows that the high management performance and satisfaction of the franchise headquarters has a positive effect on the Re-contract intention of franchise. In the case of large markets such as China, the franchisor's strategy and the role is very important. Conclusions - This study provides franchisors and practitioners, who plan to extend their franchising business abroad into Chinese market, with some practical knowledge. in order to achieve stable profits, the franchise corporation needs to support the operation of the individual franchisee through incentives and standardization of services.

• International Journal of Advanced Culture Technology
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• v.10 no.4
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• pp.261-267
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• 2022

Thanks to China's economic development, the food service industry and franchise industry have combined to serve a huge market, and alterations continue to take place, such as the changing tastes of Chinese people and the changing food culture. Global franchise companies centered in the US are rapidly making inroads into the market, and Chinese local companies are also making efforts to expand their influence. In particular, in this situation where trends are gradually changing due to the COVID-19 pandemic, we look at the trends of franchise headquarters, franchisees, employment, and operating profits for the past 10 years using information published by the National Statistical Office of China. As we examine the information, possibilities push through. In addition, we will look at the cases of domestic companies that have entered China, the conditions and plans for their activities there, and what companies planning to enter China in the future need to prepare for.

• Journal of Distribution Research
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• v.17 no.3
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• pp.1-24
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• 2012

Franchises have recently emerged as the most rapidly expanding industry positioned to create a large impact in the domestic economic. The Chinese franchise industry developed rapidly in the period prior and subsequent to WTO accession with more than 50% of new franchises brands emerging since 2000. M&A transactions in the Chinese franchise industry have progressed actively. In the period from 2005-2007, due to the wholesale and retail market opening in accordance with the guidelines laid forth within the MOU by the WTO the Chinese franchise market is now the largest market in the world all despite a short history of only 20 years. The amount of franchise market research on China is disproportional to its current size and development potential. Beginning in the 1990s, market research conducted by the International Franchise Association focused on emerging markets in Eastern Europe and China. While the research dealt with the Chinese investment environment, it insufficiently explained the market region and cultural environment. The purpose of this research is (i) to investigate the determinants of the performance of franchise systems in China and (ii) new contract renewals based on performance factors. This study will complement existing research in terms of the franchisee perspective. This study may also prove of the benefit to the franchise companies entering the Chinese franchise market enabling them to develop an effective strategy. This study shows that support, incentives, and system standardization by franchisor yielded a positive effect on management performance. This is consistent with previous studies by Shin (2000) and Kim (2008) targeting Korean franchises. Therefore, in the Chinese market, the franchisor must focus on support, incentives, and system standardization rather than concentrate only on the recruitment of franchisees in order to improve revenue. Hypotheses regarding franchisor control have been dismissed in existing research, in the opinion of this study, due to their complexity and inability to control the merchant as a one-kind-assessment-standard. Our findings show that the franchisees' financial condition, management ability and entrepreneurial spirit, among franchisee's characteristics, have a positive effect on franchisor's business performance and satisfaction for the franchisee. This is consistent with previous studies on headquarters' management performance of Lussier (1996), Heo and Jang (2008), and franchisees' financial condition, management ability and entrepreneurial spirit effect on franchisor's satisfaction of Weaven and Franzer (2007), Kim (2009), Han (2009), and Yoon etc. (2008). Therefore, when permitting a franchisee, financial condition, management ability, entrepreneurship of the franchisee should be carefully considered. Among relational factors between franchisor and franchisee, trust has the positive influence on the management performance of the franchisor while conflict has a negative effect. However, trust, commitment and conflict factors have been shown not to have any impact on the satisfaction of the franchise headquarters. This result is consistent with the previous studies of Pavlou and Ba (2000), Morrison (1999), Weaven and Frazer (2007), Kim and Park (1994), Sohn (2007) which show that trust between franchisor and the franchisees have a positive effect and that conflict has a negative impact on franchisor's management performance. Other factors causing a negative effective on the franchisor's management performance are a rapid environmental changes and uncertainty in the business. This is consistent with Campbell et al (2007), Kim and Kim (2009), Han and Baek (2008). Finally, the high management performance and satisfaction of the franchise headquarters has a positive effect on the intention of franchise renewal. In the case of large markets such as China, the franchisor's strategy and the role is very important. In this study, we also investigated the characteristics of franchisor and franchisee, relationship, and environmental uncertainty affecting on the management performance and satisfaction of franchisor. Recently, Korean franchises are attempting to enter foreign markets through the rise in popularity of Korean culture and entertainment commonly referred to as the Korean wave. This study provides recommendations for Korean franchises intending on entering the Chinese market. First, in order to achieve stable profits, the franchise corporation needs to support the operation of the individual franchisee through incentives and standardization of services. Second, because trust between the franchisor and franchisee has a positive effect on management performance, on-going discussion and cooperation is necessary to reduce the level of conflict.

• The Journal of Economics, Marketing and Management
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• v.9 no.5
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• pp.27-37
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• 2021

Purpose: By foreshadowing the historical background and cultural influence of Korean food and economic development in China, this paper demonstrates Chinese market entry strategies taken by TheBorn with its company history and CEO's background. Research design, data and methodology: The eclectic paradigm was utilized to analyze ownership, localization, and internalization advantages for TheBorn's first entry into the Chinese market. The research answers how TheBorn could expand its business in the early 2000s while most were skeptical about the globalization of Korean food. Results: First, possessing various restaurant franchises, food patents, and developments, and media use enabled to achieve a strong ownership advantage. Second, the Chinese market is conveniently located in South Korea. Thus, TheBorn could exercise direct management to its overseas restaurant to maintain the food quality and service. Lastly, establishing a sauce manufacturing plant and its branch company accelerated further expansions to other Chinese cities. Conclusions: Based on those success factors, TheBorn extended its business into different cities in China and emerged as a franchisor giant in the Korean restaurant franchise industry.

• THE INTERNATIONAL COMMERCE & LAW REVIEW
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• v.67
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• pp.49-68
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• 2015

In recent years in China, corresponding to a shift in consumption pattern from household basics to greater expenditure on quality of life, new franchising opportunities arise. Although the franchising prospect in China is promising, Korean companies aiming at franchising into China need to be aware of the legal framework for commercial franchise in China as this will have direct impact on their business expansion. Where franchising activities involve trade mark licence, Chinese Franchise Regulations require such trade mark licence agreement to be regulated in accordance with the relevant provisions of the Chinese Trademark Law. Furthermore where one party fails to perform his obligation and it impacts purpose of the contract seriously, the other party could avoid the contract in accordance with the relevant provisions of the Chinese Contract Law. To launch franchising business successfully in China, Korean companies do market research sufficiently before they may commence franchise business. Korean franchisor must register with local authorities in China by own name, and make Chinese partner take charge of management of the distribution network and invitation of franchisee partners.

• The Korean Journal of Franchise Management
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• v.9 no.4
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• pp.7-19
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• 2018

Purpose - Recently, global management in Korea franchise industry is becoming an important keyword. As an important branch market, Chinese market plays a major role not only by making experience of the competitiveness among global brands which offers a foothold to become a top global brand, but also by actualizing an economies of scale in production, sales, etc. Therefore, it is necessary to identify key successful factor influencing customer evaluation and responses of Korean franchise restaurant targeting Chinese consumers in China context. The purpose of this study is to examine the effects for Korean franchise restaurant selection attributes on perceived value, customer satisfaction and customer loyalty in Chinese context with SmartPLS 3 and Artifical Neural Network(ANN). Research design, data, and methodology - For these purposes, the authors developed several hypotheses. A questionnaire survey was conducted on the panel of online survey companies for Chinese consumers who have visited Korean franchise restaurants. A total of 404 data were analyzed using structural equation modeling(SEM) and artifical neural network(ANN) with SPSS 22.0 and SmartPLS 3.0. Result - The findings of this study are as follows: First, the alternative model findings show that facilities & atmosphere, employee service, and menu influenced on utilitarian value, customer satisfaction, and customer loyalty directly. Second, employee service influenced on customer satisfaction. Third, menu influenced on hedonic value. Fourth, brand reputation influenced on utilitarian value. Fifth, hedonic value increase customer satisfaction and customer loyalty. Sixth, hedonic value increase customer loyalty. Seventh, customer increase customer loyalty. And, the ANN analysis shows that utilitarian value is the first most important factor influencing customer satisfaction, followed by hedonic value, facilities & atmosphere, menu and employee service. However, the ANN analysis shows that customer satisfaction is the first most important factor influencing customer loyalty, followed by utilitarian value, hedonic value, brand reputation, menu, and employee service. Conclusions - This study provides practical implications for enhancing customer satisfaction and customer loyalty by applying the ANN technique that complements the limitations of the linear structural relationship analysis using the proposed model and the alternative model. In other words, the SEM-ANN model provides guidelines on how Korean franchise restaurants should formulate facilities & atmosphere, employee service, and menu mix strategies in China. In addition, ANN 's analysis shows that restaurant brand reputation plays a pivotal role in increasing customer loyalty. The fact suggests that Korean franchise companies should establish their domestic brand reputation prior to their entry into overseas markets such as China.

• Korean Journal of Organic Agriculture
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• v.25 no.4
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• pp.663-677
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• 2017

As Korean food service franchise companies sought to advance into around 2,000 new foreign markets, the importance of global management was emphasized. They intensively expanded into Chinese and American markets in 2015 and these two markets account for approximately 40% of total food service franchise companies in foreign countries. Although Japan has huge franchise market, Korean food service franchise companies in Japan only account for 5% of total franchise companies in Asian countries. The purpose of this study is to analyze the relationship between food service franchise selection factors, brand loyalty, and revisit intention of Japanese consumers using Korean food service franchise companies in Japanese food service market, and based on the analysis results, draw the implications for the expansion of Korean food service franchise companies into the Japanese market. Food service franchise selection factors is defined as service and cleanliness, taste, safety and reliability, cost and convenience, and professionalism. The study results can be summarized as follows. First, analysis was performed to identify the effects of food service franchise selection factors on the brand loyalty, it showed that five food service franchise selection factors including professionalism, service and cleanliness, cost and convenience had positive (+) effects on the brand loyalty. One of the most important factors influencing the brand loyalty is professionalism. In order to raise food service franchise's professionalism, it is necessary for the food service franchise companies to establish stronger strategies containing professional operation systems and services compared to general restaurants. Second, analysis was performed to identify the effects of food service franchise selection factors on revisit intention, five food service franchise selection factors, service and cleanliness, safety and reliability, and cost and convenience had positive (+) effects on revisit intention. One of the most important factors influencing revisit intention is safety and reliability. Thus, in order to raise safety and reliability it is important to form trust with consumers by properly utilizing systems of food hygiene and food safety accreditation.

• Journal of the Korean Operations Research and Management Science Society
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• v.40 no.2
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• pp.79-93
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• 2015

Today, consumer needs are diversified, continually changing and differentiated. Under the market conditions of unlimited competition to satisfy those needs, businesses focus on relationship-building with customers, as well as on quality of service. As interests in the coffee market rise, in these days, coffee culture diffusion and coffee franchise chain increase have been proceeding under the lead of the young people. This study aims to find the effects of service quality on customer (Korean, Chinese and Foreigner) satisfaction using logistic regression. The results of this study show somewhat different characteristics depending on the characteristics of country people. It is expected that this study can be very useful in regard to similar business.

• Journal of Fashion Business
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• v.14 no.5
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• pp.176-194
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• 2010

According to the economy recession of U.S.A and Europe, the value of China market has been increased. Therefore the in-depth studies were essential for the companies and brands which look for new rising market. This study typed Chinese consumers by lifestyle and analyze the demographics and clothing purchasing behavior. The result of the internet survey which was carried out targeting Shanghai residents, established several consumer types of men and women respectively. In case of male consumers, established 4 groups like indifferent to advertising/brand group, seriously considering brand/health group, seriously considering leisure group, and seriously considering education group. In case of female consumers, established 3 groups like seriously considering education/food group, seriously considering housing/leisure group, and seriously considering shopping group. These groups were showed significant differences to demographics and clothing purchasing behavior. These characteristics about the groups must be reflected to marketing and merchandising strategies.