An investigation of the factors that impact on the relationship between the franchisor and franchisee : a study of the convenience stores within the petroleum industry.

Abstract

Although franchising is growing in importance as a form of business with considerable benefits to all participants, little research has been done to evaluate the factors that contribute to a successful franchise relationship from the viewpoint of the franchisee. This study is intended to provide valuable information for establishing an effective management strategy, with a view to improving the relationship between the franchisor and franchisee. The study will include an analysis of the predictors of a quality relationship between the franchisor and the franchisee; and attempts to increase the understanding of the relationships between the predictors of a quality relationship, which may contribute to the franchisee's performance and satisfaction. Using the survey responses of the franchisees of the Convenience stores within the Petroleum Industry, this study identifies key factors that affect the franchisee's motivation to become a franchisee, the franchisee's perception of the franchisor's support, the quality of the relationship, loyalty/commitment to the franchisor and the franchisee's performance. The results of this study provide strong support for the idea that the quality of the relationship between the franchisor and the franchisee plays a key role in ensuring that the contractual relationship will lead to financial success for both parties. Recommendations provided will assist the franchisor in establishing an effective management strategy to improve the relationship between the franchisor and franchisee and thus improve the rate of success for both the franchisor and the franchisee.