IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v44y2023i8p4686-4706.html

The construction of a franchise entrepreneurship decision model: The example of convenience store chains in Taiwan

Author

Listed:
  • Shih‐Kai Lin
  • Hung‐Chang Chung
  • Pei‐Yuan Huang

Abstract

Opportunity identification, opportunity development, and evaluation studies are the main contents in the entrepreneurship literature, but there lacks in‐depth research on the decision‐making process of franchise entrepreneurship. Through case interviews and literature review, this paper presents the cases of four franchise entrepreneurs of convenience store chains in Taiwan as examples to develop a new model of a franchise entrepreneurship decision‐making process. In addition to the new model of this decision‐making process, the following key observations are made based on the case comparison analysis. (1) Franchise entrepreneurs with prior knowledge of relevant industries were all affected by prior knowledge in both industrial decision and organizational type (self‐employment/franchise/merger) decision. Franchise entrepreneurs without prior knowledge of related industries were influenced by social network in both industrial decision and organizational (self‐employment/franchise/merger) decision. (2) Franchise entrepreneurs with prior knowledge of related industries were influenced by prior knowledge and potential financial reward in brand decision. Franchise entrepreneurs without prior knowledge of related industries were influenced by social network and potential financial reward in brand decision. (3) Franchise entrepreneurs with prior knowledge of related industries were influenced by prior knowledge, potential financial reward, and financial resources of the franchise headquarters in the franchise type (franchising/commissioning) decision. Franchise entrepreneurs without prior knowledge of the relevant industry were influenced by the social network, potential financial reward, and financial resources of the franchise headquarters in the franchise type (franchise/authorized chain) decision. (4) Franchise entrepreneurs were influenced by potential financial reward and franchise headquarters management knowledge in the location decision of the start‐up process, regardless of having prior knowledge of the industry or not.

Suggested Citation

  • Shih‐Kai Lin & Hung‐Chang Chung & Pei‐Yuan Huang, 2023. "The construction of a franchise entrepreneurship decision model: The example of convenience store chains in Taiwan," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(8), pages 4686-4706, December.
    • Handle: RePEc:wly:mgtdec:v:44:y:2023:i:8:p:4686-4706
    DOI: 10.1002/mde.3978
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/mde.3978
    Download Restriction: no
    File URL: https://libkey.io/10.1002/mde.3978?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Shane, Scott A. & Hoy, Frank, 1996. "Franchising: A gateway to cooperative entrepreneurship," Journal of Business Venturing, Elsevier, vol. 11(5), pages 325-327, September.
    2. Greg Fisher, 2012. "Effectuation, Causation, and Bricolage: A Behavioral Comparison of Emerging Theories in Entrepreneurship Research," Entrepreneurship Theory and Practice, , vol. 36(5), pages 1019-1051, September.
    3. David J. Ketchen Jr. & Jeremy C. Short & James G. Combs, 2011. "Is Franchising Entrepreneurship? Yes, No, and Maybe So," Entrepreneurship Theory and Practice, , vol. 35(3), pages 583-593, May.
    4. Shane, Scott & Nicolaou, Nicos, 2015. "Creative personality, opportunity recognition and the tendency to start businesses: A study of their genetic predispositions," Journal of Business Venturing, Elsevier, vol. 30(3), pages 407-419.
    5. Juliet Cox & Colin Mason, 2007. "Standardisation versus Adaptation: Geographical Pressures to Deviate from Franchise Formats," The Service Industries Journal, Taylor & Francis Journals, vol. 27(8), pages 1053-1072, December.
    6. Scott Shane, 2000. "Prior Knowledge and the Discovery of Entrepreneurial Opportunities," Organization Science, INFORMS, vol. 11(4), pages 448-469, August.
    7. ., 2001. "Entrepreneurial Alertness and Discovery," Chapters, in: Firms, Governments and Economic Change, chapter 1, pages 9-28, Edward Elgar Publishing.
    8. Vial, Virginie & Hanoteau, Julien, 2015. "Returns to Micro-Entrepreneurship in an Emerging Economy: A Quantile Study of Entrepreneurial Indonesian Households’ Welfare," World Development, Elsevier, vol. 74(C), pages 142-157.
    9. Dhruv Grewal & Gopalkrishnan R. Iyer & Rajshekhar (Raj) G. Javalgi & Lori Radulovich, 2011. "Franchise Partnership and International Expansion: A Conceptual Framework and Research Propositions," Entrepreneurship Theory and Practice, , vol. 35(3), pages 533-557, May.
    10. Gillis, William E. & Combs, James G. & Yin, Xiaoli, 2020. "Franchise management capabilities and franchisor performance under alternative franchise ownership strategies," Journal of Business Venturing, Elsevier, vol. 35(1).
    11. Saras Sarasvathy & K. Kumar & Jeffrey G. York & Suresh Bhagavatula, 2014. "An Effectual Approach to International Entrepreneurship: Overlaps, Challenges, and Provocative Possibilities," Entrepreneurship Theory and Practice, , vol. 38(1), pages 71-93, January.
    12. Catherine L. Wang & Levent Altinay, 2008. "International franchise partner selection and chain performance through the lens of organisational learning," The Service Industries Journal, Taylor & Francis Journals, vol. 28(2), pages 225-238, March.
    13. Michael, Steven C., 1996. "To franchise or not to franchise: An analysis of decision rights and organizational form shares," Journal of Business Venturing, Elsevier, vol. 11(1), pages 57-71, January.
    14. Sawant, Rajeev J. & Hada, Mahima & Blanchard, Simon J., 2021. "Contractual Discrimination in Franchise Relationships," Journal of Retailing, Elsevier, vol. 97(3), pages 405-423.
    15. Ardichvili, Alexander & Cardozo, Richard & Ray, Sourav, 2003. "A theory of entrepreneurial opportunity identification and development," Journal of Business Venturing, Elsevier, vol. 18(1), pages 105-123, January.
    16. Ozgen, Eren & Baron, Robert A., 2007. "Social sources of information in opportunity recognition: Effects of mentors, industry networks, and professional forums," Journal of Business Venturing, Elsevier, vol. 22(2), pages 174-192, March.
    17. Soili Mäkimurto-Koivumaa & Vesa Puhakka, 2013. "Effectuation and causation in entrepreneurship education," International Journal of Entrepreneurial Venturing, Inderscience Enterprises Ltd, vol. 5(1), pages 68-83.
    18. Yu, Tony Fu-Lai, 2001. "Entrepreneurial Alertness and Discovery," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 14(1), pages 47-63, March.
    19. Lawrence, Benjamin & Kaufmann, Patrick J., 2011. "Identity in Franchise Systems: The Role of Franchisee Associations," Journal of Retailing, Elsevier, vol. 87(3), pages 285-305.
    20. Grace, Debra & Weaven, Scott & Frazer, Lorelle & Giddings, Jeff, 2013. "Examining the Role of Franchisee Normative Expectations in Relationship Evaluation," Journal of Retailing, Elsevier, vol. 89(2), pages 219-230.
    21. Altinay, Levent & Brookes, Maureen & Madanoglu, Melih & Aktas, Gurhan, 2014. "Franchisees' trust in and satisfaction with franchise partnerships," Journal of Business Research, Elsevier, vol. 67(5), pages 722-728.
    22. Alessandro Giudici & James G. Combs & Benedetto Lorenzo Cannatelli & Brett R. Smith, 2020. "Successful Scaling in Social Franchising: The Case of Impact Hub," Entrepreneurship Theory and Practice, , vol. 44(2), pages 288-314, March.
    23. Kaufmann, Patrick J. & Dant, Rajiv P., 1999. "Franchising and the domain of entrepreneurship research," Journal of Business Venturing, Elsevier, vol. 14(1), pages 5-16, January.
    24. Gaglio, Connie Marie & Katz, Jerome A, 2001. "The Psychological Basis of Opportunity Identification: Entrepreneurial Alertness," Small Business Economics, Springer, vol. 16(2), pages 95-111, March.
    25. Michael, Steven C., 2000. "The effect of organizational form on quality: the case of franchising," Journal of Economic Behavior & Organization, Elsevier, vol. 43(3), pages 295-318, November.
    26. Vázquez-Suárez, Luis & Mejía-Vásquez, Pericles Ramón & Serafim da Silva, Sheila & Sánchez-Gómez, Roberto, 2022. "Gender’s moderating role in the relationship between organisational form and performance in the Spanish supermarket industry," Journal of Retailing and Consumer Services, Elsevier, vol. 64(C).
    27. Vivian Zheng, Xu & Jenny Ji, Li & Su, Chenting, 2020. "Mitigating the Negative Effects of Regional Clustering in Franchising: The Roles of Governance Mechanisms," Journal of Retailing, Elsevier, vol. 96(3), pages 434-444.
    28. Dean A. Shepherd & Dawn R. DeTienne, 2005. "Prior Knowledge, Potential Financial Reward, and Opportunity Identification," Entrepreneurship Theory and Practice, , vol. 29(1), pages 91-112, January.
    29. Hesborn Andole Ondiba & Kenichi Matsui, 2019. "Social attributes and factors influencing entrepreneurial behaviors among rural women in Kakamega County, Kenya," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 9(1), pages 1-10, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Tang, Jintong & Kacmar, K. Michele (Micki) & Busenitz, Lowell, 2012. "Entrepreneurial alertness in the pursuit of new opportunities," Journal of Business Venturing, Elsevier, vol. 27(1), pages 77-94.
    2. Ohlert, Simon & Laibach, Natalie & Harms, Rainer & Bröring, Stefanie, 2025. "Opportunity recognition in the tension field of knowledge and learning: The case of converging industries," Journal of Business Research, Elsevier, vol. 186(C).
    3. Aldawod, Alvin, 2022. "A framework for the opportunity recognition process in UK entrepreneurial universities," Technological Forecasting and Social Change, Elsevier, vol. 175(C).
    4. Nerine Mary George & Vinit Parida & Tom Lahti & Joakim Wincent, 2016. "A systematic literature review of entrepreneurial opportunity recognition: insights on influencing factors," International Entrepreneurship and Management Journal, Springer, vol. 12(2), pages 309-350, June.
    5. Watson, Anna & Dada, Olufunmilola (Lola) & Grünhagen, Marko & Wollan, Melody L., 2016. "When do franchisors select entrepreneurial franchisees? An organizational identity perspective," Journal of Business Research, Elsevier, vol. 69(12), pages 5934-5945.
    6. Shu, Rui & Ren, Shenggang & Zheng, Yi, 2018. "Building networks into discovery: The link between entrepreneur network capability and entrepreneurial opportunity discovery," Journal of Business Research, Elsevier, vol. 85(C), pages 197-208.
    7. Rosado-Serrano, Alexander & Paul, Justin & Dikova, Desislava, 2018. "International franchising: A literature review and research agenda," Journal of Business Research, Elsevier, vol. 85(C), pages 238-257.
    8. Tumasjan, Andranik & Braun, Reiner, 2012. "In the eye of the beholder: How regulatory focus and self-efficacy interact in influencing opportunity recognition," Journal of Business Venturing, Elsevier, vol. 27(6), pages 622-636.
    9. Jing Fan & Jiafu Su & Stavros Sindakis, 2024. "Customer Need Knowledge Facilitates Market Opportunity Recognition Through Absorptive Capacity and Technological Knowledge: Evidence from the IT Sector in China," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(1), pages 2192-2217, March.
    10. Matthew R. Marvel & G. T. Lumpkin, 2017. "Domain Learning and Opportunity Development in a High-Tech Context," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 25(01), pages 67-96, March.
    11. Frederiks, Arjan J. & Englis, Basil G. & Ehrenhard, Michel L. & Groen, Aard J., 2019. "Entrepreneurial cognition and the quality of new venture ideas: An experimental approach to comparing future-oriented cognitive processes," Journal of Business Venturing, Elsevier, vol. 34(2), pages 327-347.
    12. Melih Madanoglu, 2018. "Theories of economic and social exchange in entrepreneurial partnerships: an agenda for future research," International Entrepreneurship and Management Journal, Springer, vol. 14(3), pages 649-656, September.
    13. Joy Olabisi & Eileen Kwesiga & Norma Juma & Zhi Tang, 2019. "Stakeholder Transformation Process: The Journey of an Indigenous Community," Journal of Business Ethics, Springer, vol. 159(1), pages 1-21, September.
    14. Valliere, Dave, 2013. "Towards a schematic theory of entrepreneurial alertness," Journal of Business Venturing, Elsevier, vol. 28(3), pages 430-442.
    15. repec:dau:papers:123456789/8470 is not listed on IDEAS
    16. Vandor, Peter & Franke, Nikolaus, 2016. "See Paris and… found a business? The impact of cross-cultural experience on opportunity recognition capabilities," Journal of Business Venturing, Elsevier, vol. 31(4), pages 388-407.
    17. James G. Combs & David J. Ketchen Jr & Jeremy C. Short, 2011. "Franchising Research: Major Milestones, New Directions, and its Future within Entrepreneurship," Entrepreneurship Theory and Practice, , vol. 35(3), pages 413-425, May.
    18. Hadjielias, Elias & Dada, Olufunmilola (Lola) & Eliades, Kostas, 2021. "Entrepreneurial process in international multiunit franchise outlets: A social capital perspective," Journal of Business Research, Elsevier, vol. 134(C), pages 13-28.
    19. Jean-Marie Nkongolo-Bakenda & Elie V. Chrysostome, 2020. "Exploring the organizing and strategic factors of diasporic transnational entrepreneurs in Canada: An empirical study," Journal of International Entrepreneurship, Springer, vol. 18(3), pages 336-372, September.
    20. Fellnhofer, Katharina, 2023. "Positivity and higher alertness levels facilitate discovery: Longitudinal sentiment analysis of emotions on Twitter," Technovation, Elsevier, vol. 122(C).
    21. Bonney, Leff & Davis-Sramek, Beth & Cadotte, Ernest R., 2016. "“Thinking” about business markets: A cognitive assessment of market awareness," Journal of Business Research, Elsevier, vol. 69(8), pages 2641-2648.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:44:y:2023:i:8:p:4686-4706. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.