• Title/Summary/Keyword: Franchise Distribution Industry

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The effect of managerial characteristics of franchisor on the perceived justice of franchisee (가맹본부의 관리적 특성이 창업 가맹점주의 공정성 인지도에 미치는 효과)

  • Kim, Gil-Sun;Ahn, Kwan-Young
    • Asia-Pacific Journal of Business Venturing and Entrepreneurship
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    • v.7 no.2
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    • pp.157-165
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    • 2012
  • The specific gravity is heavily focused on the service industry in the economic development of domestic and overseas in these days. This will be predicted to increase persistently in the future society. Therefore the franchise system has been diffused as one of a management methods for these service industry. The franchise system is an advanced country's circulation system which has been populated in an advanced country. After the opening of circulation market, rapid growing trend has been showing on foreign country's popular brands in the local domestic market. So the franchise system has been largely focused on among the domestic manufacturing and the circulation companies. This study is to review how the management characteristics(headquarters' supports, communication, menu development, compensation) will affect the fairness perception of franchisee owner. The results of my study are as follows; It appeared that communication, menu development and compensation affected all the distribution fairness and the procedure fairness affirmatively.

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The Effect of Trust and Justice on Relation Satisfaction and Long-term Commitment in Franchise Business (가맹본부에 대한 신뢰와 공정성이 관계만족과 장기적 결속에 미치는 영향)

  • Lyu, Myoung-Keun;Yang, Hoe-Chang
    • Journal of Distribution Science
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    • v.11 no.1
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    • pp.25-34
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    • 2013
  • Purpose - This study examines the adverse press coverage that has increased in proportion to the remarkable growth of various kinds of franchise businesses in the food service industry. Today, the trust of franchisees in relation to their franchisor, and the maintenance of good relations between the two, has become a significant social issue. This study investigates relationship satisfaction and the long-term commitment between the franchisor and franchisee. Research design, data, methodology - We used a path analysis to investigate the relationship between justice and trust, trust and relationship satisfaction, justice and relationship satisfaction, trust and long-term commitment, and relationship satisfaction and long-term commitment. Structural Equation Modeling and a Sobel test were used to investigate the mediating effects of trust and relationship satisfaction. Data were collected from 237 Food Franchisees in Seoul and Gyeonggi Province in order to test the theoretical model and its hypotheses. Two research methodologies are generally used in the distribution management field. For this study, an empirical method was used. Results - A causal analysis was carried out to test if the research model has a sufficient fit index (for instance, χ2 = 46.694, df = 10, p = .000, GFI = 0.946, AGFI = 0.850, RMR = 0.034, NFI = 0.966, CFI = 0.973), and the results showed that the model was sufficient, thus demonstrating the suitability of the research model. Each hypothesis had a positive influence, both on long-term commitment and relationship satisfaction. Justice with the franchisor had a positive influence on trust. Relation satisfaction cognized by franchisees was found to positively influence long-term commitment. The franchisee perception of justice in relation to the franchisor had no significant influence on long-term commitment. The study investigated the hypothesis that trust could mediate justice and long-term commitment, and that relationship satisfaction could also mediate long-term commitment Both trust and relationship satisfaction were found to be important for long-term commitment. Specifically, trust sub-factors and justice sub-factors influenced long-term commitment. Identification-based and knowledge-based trust were more important than calculus-based trust. Distributive justice was deemed more important than procedural justice; distributive justice should thus be strengthened. Conclusions - Both franchisor and franchisee were independent businesses. Evidently however, the franchisor could not ensure profit without long-term commitment from the franchisee. As for the success of the franchise business, the franchisor should carry out appropriate strategies leading to a satisfactory relationship. For example, transparency makes it possible to maintain and enhance trust and to improve relationship satisfaction. Just relations between franchisor and franchisee should make it possible to maintain and enhance the franchisee's trust. The franchisor should provide a variety of information with respect to the franchisee's business success. Finally, in order to improve the franchisee's long-term commitment, the franchisor should ensure a just approach with trust and relationship satisfaction among their strategies.

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Categorizing Quality Features of Franchisees: In the case of Korean Food Service Industry (프랜차이즈 매장 품질요인의 속성분류: 국내 외식업을 중심으로)

  • Byun, Sook-Eun;Cho, Eun-Seong
    • Journal of Distribution Research
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    • v.16 no.1
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    • pp.95-115
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    • 2011
  • Food service is the major part of franchise business in Korea, accounting for 69.9% of the brands in the market. As the food service industry becomes mature, many franchisees have struggled to survive in the market. In general, consumers have higher levels of expectation toward service quality of franchised outlets compared that of (non-franchised) independent ones. They also tend to believe that franchisees deliver standardized service at the uniform food price, regardless of their locations. Such beliefs seem to be important reasons that consumers prefer franchised outlets to independent ones. Nevertheless, few studies examined the impact of qualify features of franchisees on customer satisfaction so far. To this end, this study examined the characteristics of various quality features of franchisees in the food service industry, regarding their relationship with customer satisfaction and dissatisfaction. The quality perception of heavy-users was also compared with that of light-users in order to find insights for developing differentiated marketing strategy for the two segments. Customer satisfaction has been understood as a one-dimensional construct while there are recent studies that insist two-dimensional nature of the construct. In this regard, Kano et al. (1984) suggested to categorize quality features of a product or service into five types, based on their relation to customer satisfaction and dissatisfaction: Must-be quality, Attractive quality, One-dimensional quality, Indifferent quality, and Reverse quality. According to the Kano model, customers are more dissatisfied when Must-be quality(M) are not fulfilled, but their satisfaction does not arise above neutral no matter how fully the quality fulfilled. In comparison, customers are more satisfied with a full provision of Attactive quality(A) but manage to accept its dysfunction. One-dimensional quality(O) results in satisfaction when fulfilled and dissatisfaction when not fulfilled. For Indifferent quality(I), its presence or absence influences neither customer satisfaction nor dissatisfaction. Lastly, Reverse quality(R) refers to the features whose high degree of achievement results in customer dissatisfaction rather than satisfaction. Meanwhile, the basic guidelines of the Kano model have a limitation in that the quality type of each feature is simply determined by calculating the mode statistics. In order to overcome such limitation, the relative importance of each feature on customer satisfaction (Better value; b) and dissatisfaction (Worse value; w) were calculated following the formulas below (Timko, 1993). The Better value indicates how much customer satisfaction is increased by providing the quality feature in question. In contrast, the Worse value indicates how much customer dissatisfaction is decreased by providing the quality feature. Better = (A + O)/(A+O+M+I) Worse = (O+M)/(A+O+M+I)(-1) An on-line survey was performed in order to understand the nature of quality features of franchisees in the food service industry by applying the Kano Model. A total of twenty quality features (refer to the Table 2) were identified as the result of literature review in franchise business and a pre-test with fifty college students in Seoul. The potential respondents of our main survey was limited to the customers who have visited more than two restaurants/stores of the same franchise brand. Survey invitation e-mails were sent out to the panels of a market research company and a total of 257 responses were used for analysis. Following the guidelines of Kano model, each of the twenty quality features was classified into one of the five types based on customers' responses to a set of questions: "(1) how do you feel if the following quality feature is fulfilled in the franchise restaurant that you visit," and "(2) how do you feel if the following quality feature is not fulfilled in the franchise restaurant that you visit." The analyses revealed that customers' dissatisfaction with franchisees is commonly associated with the poor level of cleanliness of the store (w=-0.872), kindness of the staffs(w=-0.890), conveniences such as parking lot and restroom(w=-0.669), and expertise of the staffs(w=-0.492). Such quality features were categorized as Must-be quality in this study. While standardization or uniformity across franchisees has been emphasized in franchise business, this study found that consumers are interested only in uniformity of price across franchisees(w=-0.608), but not interested in standardizations of menu items, interior designs, customer service procedures, and food tastes. Customers appeared to be more satisfied when the franchise brand has promotional events such as giveaways(b=0.767), good accessibility(b=0.699), customer loyalty programs(b=0.659), award winning history(b=0.641), and outlets in the overseas market(b=0.506). The results are summarized in a matrix form in Table 1. Better(b) and Worse(w) index indicate relative importance of each quality feature on customer satisfaction and dissatisfaction, respectively. Meanwhile, there were differences in perceiving the quality features between light users and heavy users of any specific franchise brand in the food service industry. Expertise of the staffs was labeled as Must-be quality for heavy users but Indifferent quality for light users. Light users seemed indifferent to overseas expansion of the brand and offering new menu items on a regular basis, while heavy users appeared to perceive them as Attractive quality. Such difference may come from their different levels of involvement when they eat out. The results are shown in Table 2. The findings of this study help practitioners understand the quality features they need to focus on to strengthen the competitive power in the food service market. Above all, removing the factors that cause customer dissatisfaction seems to be the most critical for franchisees. To retain loyal customers of the franchise brand, it is also recommended for franchisor to invest resources in the development of new menu items as well as training programs for the staffs. Lastly, if resources allow, promotional events, loyalty programs, overseas expansion, award-winning history can be considered as tools for attracting more customers to the business.

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The Effect of Marketing Activities on the Brand Recognition, Brand Familiarity, and Purchase Intention on the SNS of Franchise Companies

  • CHUN, Tae Yoo;LEE, Dong Keol;PARK, No Hyun
    • The Journal of Asian Finance, Economics and Business
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    • v.7 no.11
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    • pp.955-966
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    • 2020
  • The purpose of this study is to find out how SNS marketing activities affect brand recognition, brand familiarity, and purchase intention for consumers who have purchased products from franchise chicken stores, including whether there is a moderating effect according to gender. SNS marketing activities were set up by configuring three attributes which are, SNS advertising, SNS information, and SNS events as sub-factors. For empirical analysis, a survey was conducted on SNS users, and SPSS/AMOS statistical programs were employed for the data analysis. First, the result of the empirical analysis showed that SNS advertising, SNS information, and SNS events have a significant positive effect on brand recognition. Second, it was found that the SNS events had a significant positive effect on brand familiarity. Third, it was found that SNS advertising has a significant positive effect on purchase intention. Fourth, it was observed that brand recognition has a significant positive effect on brand familiarity. Fifth, it was found that brand recognition and brand familiarity have a significant positive effect on purchase intention. Sixth, it was found that gender plays a significant role in the relationship between these constructs. Therefore, it can be assumed that the hypothesis presented in this study is sufficiently proven.

Effects of Independent Operator's Company Selection Attributes on Economic and Non-Economic Satisfaction, Trust, and Recommendation in the Network Marketing Industry (네트워크 마케팅 산업에서 독립 사업자의 기업 선택 속성이 경제적 및 비경제적 만족과 신뢰, 추천의도에 미치는 영향)

  • Roh, Hyun-Sik
    • The Korean Journal of Franchise Management
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    • v.10 no.1
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    • pp.19-32
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    • 2019
  • Purpose - Since the opening of Korea's distribution market, the domestic network marketing market has been continuing to grow. In this context, research on network marketing independent operators, which plays the most important role in the network marketing industry, is insufficient. This study was to identify the effects of Independent Operator's Company Selection Attributions on the Economic and Non-Economic Satisfaction, Trust, and Recommendation. The results will provide strategic direction, theoretical and practical implications for companies and operators in the network marketing industry. Research design, data, and methodology - In order to verify the research hypotheses, the data were collected from Independent Operators of Network marketing industry using questionnaires. The pretest was conducted from January 8 to 19, 2018, and the main survey was conducted from February 1 to 28. A total of 210 questionnaires, of which 193 copies were collected. The data were analyzed with SPSS 21.0. and AMOS 21.0. Results - The results are as follows; product competitiveness and system competitiveness have significant effects on economic satisfaction and non-economic satisfaction. Economic and non-economic satisfaction have significant effects on business trust. Economic and non-economic satisfaction did not influence recommendation intention directly, but influence it indirectly. Business trust has a significant effect on business recommendation intention. Conclusions - After starting network marketing business as an independent operator, the competitiveness of the company is meaningless, and product competitiveness and system competitiveness are important factors for economic and non-economic satisfaction. Therefore, network marketing companies and independent operators should prioritize product competitiveness and system competitiveness between business development. The findings show that trust in the business is very important for active business Recommendation to others. Therefore, network marketing firms and independent operators need to make efforts to meet economic and non-economic satisfaction, which have a significant impact on business trust.

An Empirical Study on the Relationship between the Key Success Factors and the Usage Effect of the e-Sports Business (e스포츠 비즈니스의 주요 성공요인과 이용효과와의 관계에 관한 실증연구)

  • Lee, Kyung-Jin;Kim, Chang-Su
    • The Journal of Information Systems
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    • v.20 no.2
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    • pp.109-134
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    • 2011
  • The purpose of this paper is to present an overview of the characteristics of the e-sports business at a crucial point in the era of information and knowledge. That is, an investigation was conducted surrounding the key success factors of e-sports as a newly growing industry, and the relationship between the key success factors and the usage effect. In order to do this, the key success factors were extracted from interviews with e-sports experts in conjunction with a survey that was conducted to gather empirical data. The key points of the statistical analysis of the survey are as follows. First, the success factors of a policy do not have a significant effect on the usage. Second, some administrative success factors of the e-sports business include the distribution of e-sports in the form of franchise chain, the establishment of policies to prevent the excellent members of e-sports from seceding, making a good impression as a high-class sport, the frequent notice of the break-even point, and educating people on how to use the e-sports machine. Third, the development and distribution of excellent e-sports software was analyzed as a technical success factor of the e-sports business. Finally, there is no doubt that results of this study can be used to facilitate the growth of the e-sports business as a new industry related to the IT industry.

The Effect of Business Relationships on Conflict and Satisfaction in the Cosmetics Industry's Distribution Channel (코스메틱 산업에서의 유통경로상 거래관계가 갈등과 관계만족에 미치는 영향)

  • Park, Soo-Hong;Yang, Hoe-Chang;Sun, Il-Suck
    • Journal of Distribution Science
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    • v.13 no.6
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    • pp.79-86
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    • 2015
  • Purpose - The cosmetics industry is a traditional high value-added industry in terms of the domestic demand, small batch production systems, exclusive competition, and raw materials highly dependent on overseas countries as well as an oligopolistic market structure. However, new foreign brands and growing consumer awareness of inexpensive products, has triggered a shift. In line with changing lifestyles and the polarization of consumption, the industry faces a new market structure. Among its key characteristics is the cosmetics industry's numerous distribution channels (i.e., department stores, door-to-door sales, online shopping malls, brand shops, and discount stores). Therefore, the study of its distribution channels is essential. Research design, data, and methodology - The study analyzed channel distribution power divided into coercive and non-coercive power. The factors of coercive power included: unilateral request of an increase in commissions, interference in sales by taking advantage of a superior status, unilateral buck-passing at the time of a problem, unilateral request to stop sales activities, and a unilateral business contract; the factors of non-coercive power included favorable payment conditions, offers of various kinds of information, policy on commission reduction, pride in market entrance, and promotion support. In addition, the mediating variable "interdependence" was applied to the execution of department store (or mart) power and their shop conflicts and satisfaction to examine direct and indirect influential power. The methodology was a survey of managers of cosmetics shops in department stores (or marts). The questionnaire, based on a five-point Likert scale, included questions about basic personal information, execution of power, interdependence, conflict, and satisfaction. The study distributed 198 questionnaires and collected 131. Ten questionnaires with missing or hard to analyze data were excluded. Thus, 121 copies were analyzed. Results - According to the analysis, the execution of coercive power by department stores (or marts) did not affect interdependence, but the execution of non-coercive power did. Interdependence did not influence conflict, but did affect satisfaction. Additionally, the analysis revealed direct influential power: the execution of coercive power positively affected conflict and negatively influenced satisfaction; the execution of non-coercive power positively affected satisfaction. Conclusions - To offer suggestions for distribution business relations in the cosmetics industry, this study investigated how the execution of power by department stores (or marts) affected their shops. More specifically, it examined how much the execution of both coercive power and non-coercive power influenced conflict and satisfaction, and analyzed the mediating role of interdependence. In line with previous study results in various areas, coercive power was shown to be the source of conflict, leading to a decrease in satisfaction, whereas non-coercive power significantly positively influenced satisfaction. Moreover, non-coercive power increased interdependence, which led to greater satisfaction. As a result, interdependence had a mediating effect on non-coercive power and satisfaction. Based on the results, department stores (or marts) should look for improvements plans that increase interdependence. Such plans could alleviate conflict with the shops, increasing their satisfaction.

Effect of Sustainable Supply Chain Management on Satisfaction and Win-Win Cooperation: Comparison of Small and Medium-Sized Distribution Logistics Center and Chain Store (지속가능 공급사슬관리가 만족과 상생협력에 미치는 영향: 중소유통물류센터와 체인점의 비교)

  • RIM, Yong-Jae;YONG, Suk-Kwang
    • The Korean Journal of Franchise Management
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    • v.13 no.3
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    • pp.17-30
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    • 2022
  • Purpose: Recent emergence of diverse businesses in the distribution industry has led small and medium-sized retailers and their distribution logistics centers to face difficulties. Transactions between companies are connected within a supply chain, and the companies have relationships in the form of a supplier and a buyer. Therefore, it is important to identify causes of problems among companies through supply chain and strategic partnerships, thus developing optimal management plans and maximizing performances of companies. This study proposes that sustainable supply chain management consists of product quality, price quality, distribution quality, and promotion quality based on stakeholder theory and resource-based view. This study examined the impacts of sustainable chain management factors on satisfaction and win-win cooperation. Research design, data, and methodology: In the proposed model, satisfaction plays a mediating role in the relationship between sustainable chain management and win-win cooperation. The data were collected from 245 owners who use small and medium-sized distribution logistics center and analyzed using 2SLS (two-stage least square) with SPSS 28.0. Exploratory factor analysis and correlation analysis were used to assess the validity and reliability of constructs. Results: The findings are as follows. In the case of the total and Nadeulgage samples, product, price, and distribution quality had a significant positive effect on satisfaction, but in the case of Neighborhood super, product and price quality have a significant positive effect on satisfaction. Satisfaction has a significant positive effect on win-win cooperation in the overall, Nadeulgage, and Neighborhood super. Satisfaction plays a partial or full mediating role in the case of total, Nadeulgage, Neighborhood super. Conclusions: This study emphasized the need for sustainable supply chain management of small and medium-sized distribution logistics centers by examining the relationship between small and medium-sized distribution logistics centers and chain stores. It was found that store satisfaction plays an important role in the win-win cooperation between small and medium-sized distribution logistics centers and chain stores. Small and medium-sized distribution logistics centers can maximize product quality, price quality, distribution quality, and promotion quality by understanding the effect of chain store-related satisfaction and win-win cooperation on chain stores.

An Empirical Study on the Influence of Entrepreneurship of Franchisor's CEO on Franchisor's Performance (프랜차이즈 가맹본부 CEO의 기업가정신이 기업성과에 미치는 영향에 관한 실증연구)

  • Kang, Byung-Oh;Kim, Jin-Soo;Ahn, Sung-Sik
    • Journal of Distribution Research
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    • v.15 no.4
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    • pp.87-117
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    • 2010
  • 'Entrepreneurship' which means spirit or activity seeking new value by challenging boldly the uncertainty is one of the most important concept in 21st century business environment. Franchise Industry taking a relationship with distribution industry also needs entrepreneurship. As franchise industry consists of small and medium enterprises, the entrepreneurship of franchisor's CEO is important for the franchisor's growth. The purpose of this study is to analyze the factors influencing on the entrepreneurship of franchisor's CEO, and the effect of the CEO's entrepreneurship on franchisor's performance. For this purpose, this study set CEO's psychological characteristics, market characteristics, and social-institutional characteristics as independent variables, CEO's entrepreneurship as parameter variables, and franchisor's performance as dependent variables. And to analyze this study model, this study collected questionnaires from 152 franchisors' CEOs, and uses SEM(Structural Equation Modeling). As the result, 'CEO's Entrepreneurship' influenced on both 'Franchisor's Financial Performance' and 'Franchisor's Non Financial Performance'. The results of this study provide some guides for franchisor's CEO and government policies.

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How Entrepreneurial Proclivity Affects Job Engagement and Satisfaction of Retail Employees

  • LEE, Myoung-Soung;JEONG, Gap-Yeon
    • Journal of Distribution Science
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    • v.17 no.8
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    • pp.67-76
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    • 2019
  • Purpose - This research examined whether entrepreneurial proclivity of retail employees affects job engagement and satisfaction, which are job-related positive aspects; and whether job engagement affects job satisfaction. Research design, data, and methodology - To accomplish this purpose, data were collected for 224 retail employees working in the distribution industry in the Republic of Korea. Reliability, validity, and hypotheses were tested through structural equation modeling, and mediating effects of job engagement between entrepreneurial proclivity and job satisfaction were verified through the bootstrap method by using the process model. Results - The results show that innovativeness and progressiveness in entrepreneurial proclivity positively affected job engagement and job satisfaction, but risk-taking did not affect either job engagement or job satisfaction. Also, this research confirmed that job engagement positively affects job satisfaction. Conclusions - This study contributes to the retail literature by applying the concept of entrepreneurial proclivity in the retail employee context. This study puts forward empirical evidence that identifies the effect of entrepreneurial proclivity as a job resource that influences job engagement and job satisfaction in the JD-R model. Thus, this study surmounts the limitation of prior studies by examining entrepreneurial proclivity from the aspect of retail employees.