Work

Economic Sustainability in Franchising: A Model to Predict Franchisor Success or Failure

Year: 2017

Type: article

Abstract: As a business model, franchising makes a major contribution to gross domestic product (GDP). A model that predicts franchisor success or failure is therefore necessary to ensure economic sustainability. In this study, such a model was developed by applying Lasso regression to a sample of franchises operating between 2002 and 2013. For franchises with the highest likelihood of survival, the franchise fees and the ratio of company-owned to franchised outlets were suited to the age of the franchise. Surviving franchises were those that opened franchised outlets at a sustainable pace, increased the franchise fee as intangible assets increased, and effectively managed profitability and efficiency.

Source: Sustainability

DOI: 10.3390/su9081419

Authors: Esther Calderon-Monge, Ivan Pastor-Sanz, Pilar Huerta-Zavala

Institutions: Universidad de Burgos, Universidad de Valladolid

Language: English

Topic: Franchising Strategies and Performance

Subfield: Strategy and Management

Field: Business, Management and Accounting

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: gold

Estimated APC paid: $2,896