فرانچایزینگ (امتیاز) خرده فروشی : دیدگاه سرمایه فکری
|کد مقاله||سال انتشار||تعداد صفحات مقاله انگلیسی||ترجمه فارسی|
|2929||2005||10 صفحه PDF||سفارش دهید|
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Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Retailing and Consumer Services, Volume 12, Issue 1, January 2005, Pages 25–34
Retailers appear to have found franchising to be a valuable means by which to develop their businesses, both domestically and abroad. In the UK franchising accounts for approximately one-third of all retail sales (Franchise Survey, 2003). This paper explores the implications of franchising on the intellectual capital (IC) development and knowledge management (KM) for retail organisations, given that for retail organisations asset intangibility is a particular feature. As such, this paper breaks new ground in engaging currently topical concepts from leading-edge debates in the management literature (IC and KM) to examine franchising in service sector businesses. The paper should hold considerable interest for, not only academics interested in franchising per se, but also business researchers examining fields such as innovation and intangible asset growth.
Retailers appear to have found franchising to be a valuable means by which to develop their businesses, both domestically and abroad. In the UK franchising accounts for approximately one-third of all retail sales (NatWest/BFA, 2003), and in the United States (US) it is estimated that by 2005 50% of all retail sales will come from franchises (Tikoo, 1996). Many high street names have used franchising as a means of accessing international markets, including Mothercare, Debenhams, Toys ‘R’ Us, Marks and Spencer, to name but a few. Thus the importance of franchising to retailing is evident. Franchise operations are a hybrid form of economic organisation (Norton, 1988), located between hierarchical and market forms (Williamson, 1975; Jarillo, 1986). Competing definitions abound, but principally franchising can be defined as an arrangement in which the owner of a product, process or service (the franchisor) licenses someone else (the franchisee) to use it in exchange for some sort of payment. Typically retail franchises are business format franchises, which involve the “…exploitation, not merely of goods identified by a trademark or services identified by a service mark, but the preparation of the ‘blueprint’ of a successful way of carrying on a business in all its aspects” (Mendelsohn, 1999, p. 4). The distinguishing feature of business format franchises is that the franchisor is expected to provide the franchisee with all of the elements necessary to run the business, that is to provide franchisees with the necessary know-how to operate the business, and provide continual support. The use of franchising has principally been explained by resource arguments and agency theory. Resource scarcity theory proposes that companies are motivated to franchise primarily as a means of raising capital (Oxenfeldt and Kelly, 1968). The franchisees pay an initial fee to join the system, and also provide a constant and on-going stream of finance to the franchisor, via ‘royalty’ incomes or management fees, in return for continual support. In addition to requiring financial resources, in the early stages of development the franchisor will require informational and managerial resources (Michael, 2002). The franchisor will require information regarding desirable locations, information regarding sources of labour and site managers to implement the business concept. As franchisees operate typically in markets and communities of which they are themselves members and have considerable local knowledge, they can provide such information. Thus, franchisees bring to the franchise system not just financial capital, but also a knowledge of geographic locations and labour markets, and their own managerial labour; that is they represent an efficient bundled source of financial, managerial and information capital (Dant and Kaufmann, 2003). This resource scarcity view would suggest that in the long-term franchised chains will revert to company owned networks (Oxenfeldt and Kelly, 1968) and has prompted a number of studies who have attempted to test this proposition (see Dant et al. (1996) for an analysis of the literature). Agency theory suggests that by making franchisees residual claimants, franchising provides incentives to reduce opportunistic behaviour (Mathewson and Winter, 1985; Brickley and Dark, 1987; Norton, 1988; Sen, 1993). The franchisee owns the right to operate the franchisor's business system in a particular area, and keeps the residual claims after paying a royalty (management fee), usually a percentage of sales. These ownership rights should induce the franchisee to extend greater effort in supervision and other cost reducing and demand generating activities (Michael, 2002). Thus, by making franchisees residual claimants, a franchisee has a greater incentive to supervise operations than an employee (Michael, 2002). For retailers, this is particularly pertinent, as where an agent's effort is an important determinant of sales, the benefits of franchising may be greater (Lafontaine and Slade, 1997). These agency issues may help explain the presence of large, well-established franchised networks. The literature on franchising has tended to focus on the motivations for franchising, as summarised above, and considered the relative failure rates of franchises compared with small businesses. There has been little research to date, however, which has considered the impact of franchising on business performance, although researchers such as Cliquet and Perrigot (2003) have begun to examine such issues. Equally the critical factors for a successful franchise network are under explored, although there is a growing literature on the area of franchisor/franchisee relationships (see for example, Baucus et al., 1996; Kaufmann and Eroglu, 1999, Dant and Nasr, 1998). It is believed that an intellectual capital framework may provide a useful mechanism by which to develop an understanding of such issues. The aim of this paper therefore, is to explore the implications of the intellectual capital framework for retail franchises, and puts forward a series of propositions for future research. Service sector businesses, by their very nature, have relatively few assets that are tangible, and therefore much of their success relates to the ability to effectively manage and maximise the value of their intangible assets. Intellectual capital (IC) refers to the intangible assets, that is, the knowledge resources, information, experiences, skills, structures, culture and relationships of a company which collectively can create wealth (Wexler, 2002). Given the dependence of service sector businesses on their intangible assets, it is believed that the IC framework thus provides a useful mechanism by which to consider retail franchises. The paper is structured as follows. Firstly, the intellectual capital framework is explained. An examination then follows, drawing on this framework, of the impact of franchising on retail organisations. The paper concludes by reviewing the findings, and suggesting areas for further research.
نتیجه گیری انگلیسی
Porter (1985) argues that competitive advantage is concerned with developing a value creating strategy, through uniquely combining bundles of resources and skills (Hoffman and Preble, 2003). Firm resources will include both tangible and intangible assets. This paper has argued that for retail businesses the development of intangible assets is crucial for success. In particular, retailers need to develop their Intellectual Capital (IC). By adopting an IC mode of analysis this paper has provided a useful examination of the implications of franchise development for retail organisations. According to Forward and Fulop (1996), firms franchise in order to diversify, achieve rapid market growth, and improve performance at the outlet level. The IC framework can help us understand why this is the case. Knowledge of competitors, substitutes, methods of distribution and industry practice are crucial to determining competitive advantage (Porter, 1985). Franchisees can provide such knowledge at a local level, complementing the franchisor's general industry knowledge: in other words, franchisees provide a valuable source of human capital, enabling franchisors to enter markets which otherwise would not be viable. For franchise systems one of the key challenges is to capture the tacit knowledge franchisees hold, so that when they leave the system, for whatever reason, their knowledge does not leave also. It has been argued that for this to occur, appropriate and adequate communication channels are vital, so that a trusting, co-operative relationship can develop. It may be the case though, that in some circumstances, however good the relationship, that the tacit knowledge can never adequately be captured, and thus the unit remains franchised. Whilst there may be many reasons for wishing to have a mix of company-owned and franchised units (see Bradach (1998) and Cliquet (2000) for a discussion of the issues), it may be this inability to fully capture the franchisee's knowledge that determines, at the unit level, which stores remain franchised and which are company owned. This is an area which needs to be further explored. The preceding discussion has highlighted franchisees as a source of human capital, and considered how the structural capital may impact the ability to fully exploit the full potential of that resource. This suggests that there may be a relationship between the ability to manage the elements of intellectual capital and company performance. Certainly there is some evidence (from non-franchised businesses) to support this view (Bontis et al., 2000). It has been argued that franchisees provide a particularly rich source of human capital, as they will be motivated, have entrepreneurial flair and have knowledge of local markets. However, in return for this resource the franchisor receives only a small percentage of the sales from each outlet. It is suggested, therefore, that the decision to franchise will depend on whether intellectual capital can best be captured and managed through a franchised system or a company owned one, or indeed, as Bradach (1998) suggests a plural form network. It may be that in some instances the generation of intellectual capital more than compensates the franchisor for the loss of sales revenue. This would suggest that franchising is more likely to occur where: • Competitive capital cannot be easily acquired from other sources. For example where the unit is physically remote from headquarters, the costs of monitoring competitor activity may be too great. •Relational capital is better managed through franchisees. As a local business person it may be easier for a franchisee to establish and develop customer relations. In addition connections with local suppliers (if permitted) may be more easily established than through a remote and anonymous corporate headquarters. • Franchisees provide human capital that cannot easily be found and developed in company managers. In particular, for young chains, acquiring quality, talented managers may be difficult, and franchising may provide a solution to this (Thompson, 1994). Equally in highly competitive and developing markets where research and development is of prime importance, franchisees may provide a relatively cheap source of innovational capital. •It is perceived that the complexity and costs of the structural capital required to support franchisees is less than for company-owned units. In particular, where geographic distance between units is large, there may be substantial monitoring costs for company-owned units (as suggested by agency theory). It could also be argued, that because franchisees are more entrepreneurial fewer mechanisms need to be put in place to try and foster innovation. Whilst the IC framework may help us better understand why companies choose to franchise it may also provide some insights into the determinants of the performance of franchise systems. As this paper has discussed, a number of IC issues emerge from franchising. In particular, the management of the franchisee/franchisor relationship provides many challenges, and suggests the need for the structural capital to be adjusted to cope with these. From this analysis, a number of propositions are put forward for future research and debate. Given the importance of head office development to support franchisees and provide training, it seems probable that there will be a relationship between the size and structure of head office and system performance. It may be, for example, that there is an ideal ratio of head office staff to the number of franchisees. Thus; Proposition 1. There is a relationship between head office structure and franchise performance Related to the issue of head office development, the importance of good communication has been stressed. Thus it is proposed that the franchisor's communication strategy will be related to performance. For example, the frequency of field visits, of telephone communications, the establishment of a franchisee association, the existence of company newsletter, and indeed the sophistication of the IT systems, may all have an influence. Therefore; Proposition 2. There is a relationship between the communication strategy and franchise performance This paper has argued that franchisees may provide a source of innovational capital, but that this in itself may be a source of conflict within the system. If a franchisor is seen to be able to accept suggestions from franchisees this may help develop good franchisee/franchisor relations to the benefit of the system. Thus, the number (or proportion) of franchisee innovations which are adopted may also provide insights into system performance. Proposition 3. There is a relationship between the willingness of the franchisor to accept franchisee innovations and system performance This paper has attempted to identify the key importance of intellectual capital in franchising, not only as a means of assimilating intangible metrics alongside traditional measures of company worth, but also as a useful tool for strategy formulation. It is hoped this exploratory analysis promotes a better understanding of franchising at a general level (Stanworth and Curran, 1999) and, hopefully, will be a catalyst and platform for further research and debate.