واکنش بازار سهام به انتخاب حالت ورود شرکت های هتل های چند ملیتی

This paper contends that when entry mode choices are aligned with the characteristics of the host country, investors are likely to respond more positively to the expansion announcement than when there is no or little alignment. Empirical results from the international hotel industry support this contention. The findings specifically reveal that the announcements of new management contracts in developing countries, and new franchise agreements in developed countries, cause superior abnormal returns. The study also further supports the notion that control and ownership need to be treated as separate dimensions in the entry mode literature.

As the hotel industry continues its global expansion, several organizational forms have appeared to be favored in entering foreign markets. Contractual agreements such as franchise and management contracts have for long been widespread means of entry (Dunning and McQueen, 1981). Joint-ventures, minority equity interests and wholly owned subsidiaries have also been used, yet to a lesser extent (Olsen and Zhao, 2000). An increasing amount of studies have attempted to delve into the determinants of choice of entry modes in the hotel industry. For the most part, these scholarly endeavors have tried to provide answers to the questions of which mode is preferred, why it is preferred, and what determines that choice (e.g. Contractor and Kundu, 1998). These determinants appear to be well understood as the findings of these efforts consistently emphasized similar determinants, especially factors related the host country's risk profile and to the need for control over the assets and operations (e.g. Dev et al., 2002). What is less clear at this stage is whether the association between these determinants and the chosen organizational form is actually related to the performance of the foreign operation. Indeed, little attention has been paid to the performance consequences of entry mode choices in the general management literature, and no study thus far has ever investigated such relationships in the context of the hotel industry. As the hotel industry faces an increasingly competitive environment, especially for capital and growth opportunities (Olsen et al., 2007), improving upon our understanding of market entry strategies and their influence on firm performance appears to be an important undertaking. Based upon the current understanding of the determinants of entry mode choices, and the lack of research on the influence of such modal choices on performance, an initial attempt to investigate how investors value entry mode strategies in developed and developing countries appears to be a worthy task. Thus, the present research effort was designed to answer the following questions: 1. Are the entry mode choices in the international hotel industry different for developed and developing host countries? 2. Are the combinations of entry mode choices and the development stages of the host countries valued by investors?

Prior empirical works have demonstrated the significant influence of the development stage of the host country on the entry mode choices made by multinational firms (e.g. Zhao et al., 2004). In general, a low development level has been viewed as a risk factor that deters equity investments. Yet, as developing countries have also been perceived as providing less skilled labor and weaker managerial capabilities than developed nations, firms have been encouraged to maintain a fair amount of control over the conduct of their operation in such environment. In the hospitality industry literature, Dev et al. (2002) showed that under such circumstances, international hotel chains favored management contracts in an attempt to limit the amount of equity at stake, and to maintain operational control. Alternatively, in developed countries, equity investments have been considered as the preferred entry mode as the investment risk associated with such strategy was deemed as low, and the return potential superior to other entry modes (Anderson and Coughlan, 1987). In the context of the hotel industry, franchising agreements have also been seen as superior to management contracts in developed countries, principally as it permits a stronger alignment of goals between the unit managers (i.e. franchisees) and the corporation (i.e. franchisor), thereby minimizing the agency costs (Contractor and Kundu, 1998, Brown et al., 2003 and Dev et al., 2002). This study tested several arguments pertaining to the dependence of the modal choices on the development stages of the host country, and to the performance consequences of the alignment between choices of entry modes and host countries development levels. It was hypothesized that the alignment between the choice of entry and the host country's characteristics would result in superior performance, as measured by the abnormal returns following the announcement of market entry. Several more detailed hypotheses were also posited, arguing that the announcements of some modes of entry in some specific countries would result in higher abnormal returns. A number of the suggested relationships were supported; specifically, that the abnormal returns following the announcement of an entry in a foreign market was dependent upon the degree of alignment between the entry mode choice and the development stage of the host country. Also, the announcements of management contracts in developing countries resulted in higher abnormal returns than the other modes of entry, and that the announcements of franchise agreements in developed countries produced higher abnormal returns than the management contract mode. Conversely, the hypothesis suggesting that the announcement of equity investment in developed countries would result in superior abnormal returns was not confirmed. These results highlight several key points related to the perceived performance consequences of entry mode choices in the international hotel industry. First, as suggested by prior studies, there is no universally superior modal choice; the performance of foreign market entry is contingent upon the modal choice and the development stage of the host country. It is likely that the alignment of the choice with other internal and external factors would also be important to the performance of the venture. Further research should be conducted to test more complex alignment forms. Secondly, the arguments brought forward by Dev et al. (2002) and Brown et al. (2003), which essentially suggest that one of the key differences between the management contract and franchise agreement modes of entry reside in the availability of managerial capabilities in the host country, appears to be mostly verified. Management contracts are indeed apparently more valued when used in developing countries, whereas franchise agreements are more prized when used in developed countries, yet only nearly significantly. Thirdly, the various claims regarding equity investments in developed countries appear not to hold in the context of the hotel industry. While the limited amount of announcements found for such entry mode choice reduces the extent to which one may generalize from the findings of this study, it also shows that such modal choice is not favored in the industry. More detailed characteristics of these transactions could shed more light on these announcements. However, it is worth noting that the abnormal returns following the announcements of equity involvement entry modes in developed and developing countries are the highest and lowest significant CAR respectively. This large difference in CAR (from 0.61% to −0.46% as shown in Table 2) calls for more investigation for this mode of entry. From a managerial standpoint, the results of this study indicate that equity investors do value entry mode choices differently when the entry is made in developed or developing countries. While the results do not provide a decision framework as to exactly which entry mode should be favored in a given country, they do offer a number of generic guidelines. Indeed, when the entered market is defined by a lower level of development as per the OECD criteria, then management contracts appear to be more appropriate as equity investors would price the decision better than other entry modes. In addition, when the entered market is deemed as more developed in OECD terms, then franchising appears to be better priced than management contracts. For managers of publicly traded companies, such guidelines are likely to be important even if the operational performance of the venture is not guaranteed. Overall, the results presented above provide answers to the research questions that triggered this study. However, it is worth noting a number of limitations. First, the nature of the sample, driven by the current trend toward management contracts, has potentially limited the extent to which the results can be generalized. Specifically, the limited amount of announcements related to equity involvement (i.e. 10) may not be sufficient to fully grasp what investors’ value when equity investment is involved. A more fined grained analysis of each announcement, coupled with additional cases, would certainly yield more specific recommendations, especially on the effect of the magnitude of equity invested on the expected risk-adjusted performance. Secondly, the binary classification of the host country, OECD versus non-OECD countries, does not permit a detailed evaluation of the environment of the entered countries. It is indeed likely that wide variations in these environments exist within each of the two groups and that such variations could alter the relationships reported in this study. Future research could thus aim to further refine the measure of country profile.