• Journal of Korean Society of Industrial and Systems Engineering
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• v.47 no.3
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• pp.18-30
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• 2024

Although concerns about overheating of the franchise industry's market structure continue to be raised, there are few studies that analyze the market structure of the franchise industry and suggest practical use. Most existing studies mainly analyze the market structure of other industries using industrial concentration(HHI) as an indicator of market competition intensity from the perspective of industrial organization theory. This study seeks to present a market structure analysis method that is different from existing methods. Considering practical application, this study presented a method to analyze the market structure that combines industry concentration(HHI) analysis and matrix analysis of the franchise industry. First, the industry concentration(HHI) and operating profit ratio(SMR) of 15 major industries in the franchise industry were analyzed in a time series manner (2014-2019). Second, using industrial concentration and operating profit ratio(SMR) as two variables on the x-axis and y-axis, a two-stage matrix analysis was used to understand the market structure characteristics of 15 industries at a glance. Third, a method of utilizing the matrix analysis results for practical decision-making was presented.