Franchisee perceived relationship value

Abstract

Purpose The paper seeks to develop a conceptualization of franchisee perceived relationship value (FPRV), defined as the trade‐off between perceived net worth of tangible and intangible benefits and costs to be derived over the lifetime of the franchisor‐franchisee relationship, as perceived by the franchisee, taking into consideration the available alternative franchise relationships. Design/methodology/approach A survey of existing literature provided the relevant constructs and concepts for developing a conceptual framework of FPRV. Findings The behavioral aspects of the franchise relationship are explored from the franchisee's perspective, providing an alternative viewpoint of the franchise relationship. Practical implications The paper affords a useful foundation for making decisions in a franchise relationship, such as the choice of a new franchisee. This entails a comparison of an existing franchisee about which much is known versus a new franchisee about which less is known. FPRV offers a constructive lens to better evaluate this decision and help frame questions concerning the value of social elements within the relationship. Originality/value This work is among the first to examine franchisee relationship value and consequences from the franchisee's perspective. Research propositions surrounding the franchisee's behavioral expectations in the relationship are offered, and serve to guide further research in this area.

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