Critical Success Factors of International Franchising: Case Studies of Foreign Franchisors in Asia

Abstract

A multiple case study of four foreign franchisors was conducted in 2000 to study the critical success factors of international franchising in East Asia. The four franchisors were chosen because they possess different international franchising capabilities and are at varying levels of internationalisation. This study provides a useful insight into how a foreign franchisor should approach and compete successfully in East Asia. Firstly, the research provides a conceptual model, which displays the six key categories and success factors for international franchising in East Asia. The study has made a significant contribution in identifying two new categories that have mostly been neglected by researchers in international franchising. Secondly, the study reveals a unique form of master franchising that is being practiced in East Asia. Thirdly, the effective management of Asian partners is found to begin with recruiting the right partners with the desired characteristics and subsequently developing a long-term mutually beneficial working relationship with the partners. Finally, successful franchisors were found to believe strongly in the power of branding and niche marketing in East Asia.