Services vs retail chains: are there any differences?

Rozenn Perrigot

44 citations0/0 files storedInternational Journal of Retail & Distribution Management

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Franchising Strategies and Performance Entrepreneurship Studies and Influences Customer Service Quality and Loyalty

Abstract

Purpose This paper aims to review the differences between retailing and services in the particular context of franchised chains in order to highlight the main differences between retail chains and services chains. Design/methodology/approach The existence of such differences is tested in the French context because its franchising sector is the most developed one in Europe as far as the number of chains is concerned. The empirical study deals with 530 chains among which 228 are services and 302 are retail. Findings Some significant differences between services and retail chains are underlined in terms of age, plural form, franchising fees, franchising and advertising royalties, and contract length. Additionally to these significant differences, the new trend in franchising seems to consist in developing more services chains than retail chains. Research limitations/implications This paper has some limitations. The focus is on only one country: France. A multi‐countries study could be useful to confirm these differences or highlight other ones. Furthermore, a more precise classification about the sectors of activities could underline other differences. Practical implications This paper can help the prospective franchisee to better differentiate the services chains and the retail ones, and better understand their particular features. Furthermore, the new franchisor can use these descriptive results to compare his/her practices with the average practices within the sector he/she is in, above all in terms of contract terms: franchising fees, franchising and advertising royalties, and contract duration. Originality/value This paper highlights differences between different kinds of franchised chains: retail vs services. These differences have not been underlined in previous research.

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References

1997Using the Plural Form in the Management of Restaurant Chains 1999The Dynamics of Franchise Contracting: Evidence from Panel Data 1996The Dynamics of Franchise Contracting: Evidence from Panel Data 2004Multi-Unit Ownership in Franchising: Evidence from the Fast-Food Industry in Texas 2004Franchising, Ownership, and Experience: A Study of Pizza Restaurant Survival 2001Targeting Managerial Control: Evidence from Franchising 1998Franchising versus Company-Run Operations: Modal Choice in the Global Hotel Sector 1998Franchising versus Company-Run Operations: Modal Choice in the Global Hotel Sector

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