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Do stakeholders matter in entry mode decisions? An investigation of international franchise governance mode choice

Author

Listed:
  • Bretas, Vanessa P.G.
  • Galetti, Jefferson R.B.
  • Alon, Ilan
  • Rocha, Thelma Valéria

Abstract

This article aims to analyse decisions about international entry modes from the stakeholder perspective, delving into different configurations of governance modes. A quantitative analysis is employed using data on 463 observations of Brazilian companies operating in foreign markets. We find that business group affiliation, support from institutional partners, and the characteristics of host market networks all influence company decisions to adopt lower control modes in international markets. The article contributes to international entry mode and franchising literature by applying stakeholder theory to choices about foreign entry modes. It shifts the focus away from the profit- and cost-related aspects of rational choice models towards recognizing the substantial impact of stakeholders, enriching our comprehension of this complex decision-making process. Our study further offers a more nuanced understanding of mode choice by investigating modes of international franchise governance with varying levels of commitment, control, and risk.

Suggested Citation

  • Bretas, Vanessa P.G. & Galetti, Jefferson R.B. & Alon, Ilan & Rocha, Thelma Valéria, 2024. "Do stakeholders matter in entry mode decisions? An investigation of international franchise governance mode choice," Journal of Business Research, Elsevier, vol. 178(C).
    • Handle: RePEc:eee:jbrese:v:178:y:2024:i:c:s0148296324001772
    DOI: 10.1016/j.jbusres.2024.114673
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