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Recognising the Presence of Franchising as a Smart Business Solution –A study based on

the international business expansion approaches-case study analysis of food industry

Student ID No - B00800066
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Abstract
In recent years, franchising has grown in popularity as a strategy of expanding a firm.
Franchisors have utilized a variety of techniques to extend their businesses throughout the world.
In this dissertation, there is research on franchisors' abilities to produce income and open up new
worldwide market prospects. The study's purpose is to discover how franchisors throughout the
world are expanding their companies. A qualitative research approach is used to investigate ten
distinct food and beverage franchises. The franchisors all agreed that a range of variables
affected their foreign development plans, including the franchise brand, headquarters location,
product, advertising, and marketing. Potential franchisors may obtain a better grasp of the factors
driving worldwide growth as a result of the data gathered by this research. The findings of this
study may be relevant to government and government-affiliated firms that participate in
franchising. This knowledge is critical if you want to succeed in today's global business.
The federal government and food producers must collaborate to keep the public safe from
foodborne disease by using food safety authority. Regulators and commercial stakeholders must
build trust in order to adequately oversee the food supply chain. The study will show that key
stakeholders have a high degree of trust in the most successful companies. Identifying the
barriers to success is the first step toward developing strategies to improve trust and
communication.
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Table of Contents
Abstract.......................................................................................................................................................2
CHAPTER 1-INTRODUCTION........................................................................................................................5
1.1. Background of the Research Problem........................................................................................5
1.2. Aim..............................................................................................................................................6
1.3. Research Question......................................................................................................................6
1.4. Objectives....................................................................................................................................6
1.5. Deliverables:...............................................................................................................................7
1.6. Outline of Methodology.............................................................................................................7
1.7. Research Significance..................................................................................................................8
1.8. Dissertation Structure.................................................................................................................8
CHAPTER 2: LITERATURE REVIEW..............................................................................................................10
2.1 Introduction..............................................................................................................................10
2.2 Impact of Franchising on a smart business...............................................................................10
2.2.1 History of Franchising.....................................................................................................10
2.2.2 Concepts of Franchising..................................................................................................11
2.2.3 Franchising explained......................................................................................................11
2.2.4 Franchising advantages and disadvantages...................................................................12
2.2.5 Types of Franchise...........................................................................................................12
2.2.6 Types of franchising Agreements....................................................................................13
2.3 Franchising in the UK Food industry.........................................................................................15
2.4 Impact of Franchising on the International expansion.............................................................16
2.5 Theoretical Background............................................................................................................17
2.5.1 Value Creation Theory....................................................................................................17
2.5.2 Three-Stage theory of International Business Expansion.............................................17
2.6 Summary...................................................................................................................................18
CHAPTER THREE: METHODOLOGY.............................................................................................................20
3.1 Introduction....................................................................................................................................20
3.2 Research Design..............................................................................................................................20
3.3 Philosophy of the Research............................................................................................................21
3.4 Data Collection Method..................................................................................................................21
3.5 Data Analysis Technique.................................................................................................................21
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3.6 Sampling Size and Technique..........................................................................................................22

3.7 Ethical Considerations.....................................................................................................................22
3.8 Limitations of the Study..................................................................................................................23
CHAPTER 4: FINDINGS AND DISCUSSION...................................................................................................24
4.1 Introduction.....................................................................................................................................24
4.2 Thematic analysis.............................................................................................................................24
4.2.1 Theme 1: The Role of Franchising For International Franchisors.............................................24
4.2.2 Theme 2: The Efficacy of Franchising as a Smart Solution for International Expansion in Food
Industry..............................................................................................................................................26
4.3 Discussion........................................................................................................................................28
References.................................................................................................................................................33
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CHAPTER 1-INTRODUCTION
In the modern world of innovation, technology and development the business sector is
growing enormously globally and in that certain observation of business expansion the business
environment has become very common and operational (Zander et al., 2015). The expansion
happens due to several reasons most of the companies try to expand their brand for attaining the
attraction of new customers in the foreign markets and fulfill the demand in the global places
(Sallem et al., 2017). There are different kinds of business expansion fin which the ultimate
motivation is to have the expansion of business and attainment of larger scale considerations in
revenue and profit margins. Among those methods the franchising is one of the structures that
different organisations use for the expansion to the international markets all over the world. The
franchising is a technique which is most suitable for the new people in the market to have a
successful business in the early stages (Varotto and Silva, 2017).
There are different factors to consider in the approach of franchising as there is a
franchisor and a franchisee in this business section and the franchisor is the one which grants the
license, copyrights, trademark and even training to the employees on the development of
successful business (Beckhouche and kahlessenane, 2018). While the franchisee is the one which
pays a startup fee for all these facilities and then start an establish brand`s franchise in
somewhere else under the name of brand. This provides the facility of working with strong
values of customer attraction and trust factors. The franchising is a smart solution for business
expansions as in this structure the investment is almost zero from company apart from the
reputation and business expansion organisation earns royalties from the sales (Chen, 2019). The
franchise industry is increasing effectively as in United States the franchising of food industry
accounts to total 30% of total franchising in United States (Economics, 2015). It shows that
franchising is making good enhancement in the food industry development and it is interesting to
identify how the franchising is playing suitable role in the business expansion.
1.1. Background of the Research Problem
The main research problem on which the researcher has worked on is to identify about
the use of franchising for food industry expansion and it is important to identify that whether it is
a smart solution for it or not (Frisher et al., 2020). The motivation is pivoted on the franchising
as Alon et al. (2020) provided that franchising is one of the main approaches of business
expansion in which the main identification is to achieve the business expansion and scale in
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business properties but with limited sources. There is also a consideration in which the
international franchising is the method for entering into the new market but it has less control.
The importance of franchising has also been highlighted by Hoy et al. (2017) and states that the
franchising is an international proven technique for the expansion of one business organisation in
a modern market with the help of an entrepreneurial franchisee working on the development of
business in the new market with more seemingly effective and considerate matter of effect.
Moreover in this approach the Muthukrishnan et al. (2022) state that the franchising is an
important consideration in boosting performance and reputation of company, however Kukec
(2018) worked on the approach of franchising and provided that apart from the benefits the
relationship in between the franchisee and franchisor can sometimes causes a great impact on the
business performance. Thus based on these observations it can be seen that franchising is good
but it may include some disadvantages s like less control and relationship conflict which can
cause problem in the overall approach of working. Moreover Shumba et al. (2017) provided that
in the volatile businesses like in the food industry there are various problems regarding
management and business stability, while Sofijanova et al. (2016) claimed the franchising to be
an economical factor in business expansion. Based on these sections it was imperative to know
whether the approach of franchising is a smart solution of expansion of food business or not.
1.2. Aim
The aim of the study is to identify and evaluate whether the franchising is a smart business
solution for the food industry specifically restaurants for achieving the international business
expansion and examining the positive and negative impact of franchising over the international
expansion
1.3. Research Question
To what extent does franchising support international expansion and growth for the food
industry: specifically restaurants from a UK perspective?
What is franchising and how franchising is a smart business solution for food industry?
Does franchising result in the international expansion of the food industry in the context of UK?
1.4. Objectives

 To study how existing franchise businesses in food industry have achieved international
expansion
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 To review and understand the nature of challenges and failures experienced by the
existing franchisors in the food industry
 To evaluate the positive experiences of franchising for international franchisors
 To determine the efficacy of franchising as a smart solution for international expansion in
food industry
1.5. Deliverables:
The dissertation intends to provide a strategic approach to evaluate the positive and negative
impact of franchising on the international business expansion and also enlighten about its role for
the expansion of food industry to international level
1.6. Outline of Methodology
There are two types of research methodologies the Qualitative and Quantitative research
designs.Moreover the philosophy which has been employed by the researcher for the
development of knowledge is Interpretivism as it supports the collection and in-depth analysis of
data based on the observations and views (Ryan, 2018). The research structure is incomplete
without proper research approach and in the following research the deductive research approach
has been applied by the researcher for the analysis of data collected in the form of reviews form
participants and literature as it works on the evaluation of observations. In the following research
the qualitative research design has been employed by researcher and it includes the collection
and analysis of data without using any scientific methods or any statistical/numerical values for
the data (Marriam and Tisdell, 2015). Moreover there are two different types of data collection
types as the research is based on the qualitative research design hence no such data in the form of
numerical values have been collected.
The primary and secondary both sources of data collection has been performed as the
research is based on the primary qualitative approach and keeping that in mind the interview has
been selected as the primary approach for the data collection. In the primary section the
interview has been taken form the managers and workers from the small food companies have
been selected. The focus group of 10 participants have been selected and they were provided a
compete brief regarding the research and moreover the consent form was also provided to them
before the participation to make sure that no such enforcement should occur without consent.
The data analysis has been performed with the content analysis technique as the data collected
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has been divided into different themes of content regarding the franchising (Stemler, 2015).
Ethical considerations will be maintained in the research.
1.7. Research Significance
The research is significant as it provides the clarity regarding the beneficial approach of
franchising for the food industry expansion. Umarov (2021), work on the approach of expanding
business in new business environment and in that consideration it has been seen that the food
industry has been striving regarding the investment, market competitive reputation and
development in the business cycles. Consequently it can be seen that food industry is lacking in
promotion and expansion due to the investment values and this is promoted by Rifin (2019) with
his findings regarding the expansion of food industry in Indonesia it provided that the food
industry is facing the problem of capital, cost and communication problems and few others.
Based on these observations of researchers it has been seen that the capital and
communication problems are among the considerable problems. Due to the reason that
franchising does not require any proportionate consideration of investment from the side of
company and main investment lies on the side of franchise. Thus the evaluation of researcher
from the current researcher provides the understanding regarding whether the franchising is a
better solution of business expansion or not specifically for food industry. Based on these
approaches the research is significant to explain about the validity of structure which can cause
the improvements in the overall approach of working for business expansion by the food industry
using the franchising technique.
1.8. Dissertation Structure
In the current research the whole dissertation has been divided into five main sections and
in those sections the first is introduction section setting the basic concepts. The next chapter is of
literature review section in which the literature has been used to review the different ideas and
observations of researchers regarding the topic and review on those approaches have been
provided. The third chapter is of methodology section which explained the different method with
which the researcher has completed the following research. The researcher has also provided the
rationale behind selecting the certain methodology and in that approach the chapter also explains
the research ethics and any limitation. The chapter four and five is related to the data analysis
and the conclusion section as the data collected has been analysed and presented in the form of
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results in chapter four and a considerate discussion is also developed. The conclusion explaining
the different researcher feelings and evaluation from the research has been provided.
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CHAPTER 2: LITERATURE REVIEW

2.1 Introduction
This chapter discusses the presence of franchising as a smart business solution in the
context of the UK. Different areas of franchising have been discussed, including the history and
concepts of franchising, advantages, and disadvantages of franchising, types of franchise and
franchising agreements, an overview of the food industry, and the relationship between
franchising and international expansion, and theoretical background in detail.
2.2 Impact of Franchising on a smart business
For the past many years, the franchising business model has gained attention from
worldwide entrepreneurs. Franchising is not considered an exotic part of business operations
now but has been included in the business model used across various industries worldwide. The
companies use this model to grow within a short time duration. The entrepreneurs use the
franchising strategy to seek growth through geographic expansion (Alon, Apriliyanti and Parodi,
2020).
2.2.1 History of Franchising
The word ‘franchise’ originates from the old French dialect that means ‘freedom’. The
history of franchising goes back to the middle Ages when kings provide franchises to specific
groups and people for performing various forms of commercial endeavors on their land. The
German breweries have used franchising in the 1840s to distribute their beer to various
geographical locations (Ghani et al., 2021). Isaac Singer initiated granting franchises in the
1850s for sewing machines because he wanted to dispense his sewing machines to various US
customers. Franchising was used because Singer did not possess the capital to maximize the
production of his sewing machines. The growth of franchising started in the twentieth century
because of the increased use within the automobile and retail industry. Business format
franchising is the most common mode of franchising that attained supremacy after World War II
(Bulakh, Plakhotnikova, and Hromadskyi, 2020).
Franchising is the way for modern consumer requirements as it has increased the global
reach of brands as the largest automobile franchises have been opened in the twentieth century
worldwide. The most well-known example is the McDonald’s franchise developed in the first
half of the twentieth century that has been stretched to 100 countries in the world. Currently,
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franchising is a big business as 900 franchising brands in the UK alone contribute the highest
amount to the UK economy (Iddy and Alon, 2019).
2.2.2 Concepts of Franchising
Franchising is a type of business that most people cannot clearly understand. Many
entrepreneurs know the basis of franchising but are unfamiliar with its in-depth understanding
and practical experience. Two parties are primarily involved in the franchising agreement
including the franchisor and franchisee. The franchisor is an entity that licenses its brand name,
business concepts, trademark, and proprietary knowledge to another individual or organization
(Sadeh and Kacker, 2020). The franchisor can be an established firm or a new business. The
franchisor gives rights to another person in response to a royalty fee or franchise. Contrastingly,
a franchisee is an entity granted the right to utilize another person’s name or organization. The
franchise borrows the franchise from the owner and the franchisee gets the right to clone the
business of the franchisor. The franchisee gives the initial franchise fee to the owner and
provides continuous royalty for the given right (Sun and Lee, 2019)
2.2.3 Franchising explained
Different authors define franchising differently but these definitions are somehow
relevant to one another. Franchising is a long-term cooperative association between two different
entities i.e., franchisee and franchisor. It is based on the agreement in which the franchisor gives
a licensed privilege to the franchisee to perform business activities. Franchisor gives the right to
the franchisee to utilize the developed concept such as brand names and trademarks, marketing
methods, production, and the whole operational model of the business. The franchisee in turn
gives capital, and time, and uses the services given by the franchisor to develop a thriving
business (Orgonáš, Paholková, and Drábik, 2020).
Franchising can only perform when an organization already possesses a successful
service. The organization must have a well-designed business model and a sturdy strong
trademark. A company having a poorly flawed business model when creating value for its users
became unsuccessful in franchising. Franchising is a type of business growth that is primarily
attractive for novel ventures as franchises give capital needed for expansion. Financing growth
along with franchisees' money is the best alternative for various entrepreneurs as it helps their
debt financing. A franchisor can be a developed business that does not require franchisees'
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capital to grow its business but uses the franchising model to expand the business (Chong and
Stephenson, 2020).
2.2.4 Franchising advantages and disadvantages
Franchise buying is the most effective way to set up a business without starting from the
basics. Franchising has numerous drawbacks and benefits that are necessary to consider.
Franchising has restricting regulations because when franchises permit franchisees in business
activities, then they cannot control the business and cannot make immediate decisions about the
franchisor's opinion. The initial investment is quite costly and put a strain on the small business
owner (Rye et al., 2021). There are additional ongoing costs in the franchise and these costs are
enumerated in the franchise agreement. If a franchise is a support network, then it also possesses
a conflict potential. Within close relationships, there is always a power imbalance. Another
evident disadvantage of franchising is the use of inadequate privacy concerns. The franchise
agreement sometime stipulates that the franchisor can oversee the whole monetary ecosystem of
the franchise. This inadequacy of financial privacy can be manifested by the franchisee (Tien and
Ngoc, 2019).
Contrastingly, the business failure risk can be declined through franchising. The products
and services have already developed a market share therefore it does not require market testing.
Franchisee gets business assistance from the franchisor. The franchisee also gets the turnkey
business operations through business structure and franchise agreement. They are given the
equipment, brand, advertising plan, and supplies. Franchisors have less failure rate compared to
solo businesses (Hool, 2019). When franchisee gets franchisee, they can join a successful brand
and network that can provide advice and support. The other benefit of franchising is the
network's sheer size because the standalone business needs to pay more money per item due to
the small number of orders. The franchises network allows buying goods at a discount rate.
Franchises attain higher benefits compared to independently developed businesses. However, the
franchise that needs a higher initial investment sees a high return on investment (Arman et al.,
2019).
2.2.5 Types of Franchise
The two major types of franchise are business format franchising and production distribution
franchising discussed below
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2.2.5.1 Business Format Franchising

Business format franchising is the type of franchising in which the franchisor oversees
every domain of the business. The franchisor cannot give a trading name, services, or product to
the franchisee but gives the formula to operate the business (Ganotra, 2018). The franchisor
mostly gives franchisee training, interior design, site selection, development support, operating
manuals, quality control, brand standard, and other types of assistance to run the business. For
example, Burger King influence every domain of the franchisees to run business. They train
them from minor to major areas of cooking to presentation, employees retention to customers
engagement (Atwell, 2019).
2.2.5.2 Production Distribution Franchising
Product Distribution or Traditional franchise is less identified with franchising through an
average person but primarily possesses higher sales than business format franchising. The
product distribution franchise relies specifically on the product instead of the whole business
concept (Ganotra, 2018). Within the product distribution franchise, the franchisor of the product
provides the franchisee with the right to sell the products using its trademark. The franchisees
can autonomously run the business. They are primarily concerned with the provision of quality
products and maintaining product integrity instead of merely monitory the way franchisees run
their businesses. For example, General Motors developed a dealers’ network worldwide that sells
their cars by using their trade name (Iddy and Alon, 2019).
2.2.6 Types of franchising Agreements
The types of franchising agreements between franchisor and franchisee are of three types
including franchising agreements of individual, area, and master (Ganotra, 2018).
2.2.6.1 Individual Franchising Agreement
Within a single unit or individual franchising agreement, the franchisor provides rights to
the individual franchisees for a specific location. For example, the franchisee may borrow a
McDonald's franchise to operate it within a specific area or location in the UK (Sichel, 2018).
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Figure 1: Individual Franchise Agreement (Odunsi, 2015)

2.2.6.2 Area Franchising Agreement
Within an area franchise agreement, a franchisee possesses the right to open various
outlets within a specific domain having a predetermined schedule mentioned in the franchise
contract. Within this development framework, the franchisee and franchisor develop a
development agreement along with an individual agreement with every outlet that is opened in a
specific location. The franchisee has similar obligations and rights to the other franchisee under
this unit agreement. For example, the franchisee may borrow the right to open ten different
McDonald’s franchises within a specific location in the UK for a specific period (Ganotra, 2018).

Figure 2: Area Franchise Agreement (Odunsi, 2015)

2.2.6.3 Master Franchising Agreement
Within the master franchising agreement, new outlets are opened within the specific area
and the franchisee can sell the outlets to other people within a specific location. The parent
company i.e. franchisor permits another company i.e. sub-franchisor the right to operate different
franchise outlets within a specific outlet. The sub-franchisor also has the right to sell sub-
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franchisees within the predefined geographical location (Ganotra, 2018). Two different
agreements are included in the master franchise agreement. The first agreement is between the
franchisor and sub-franchisor while the second agreement is made between the sub-franchisor
and every sub-franchisees. For example, headquarter of Mcdonald's is located in Illinois, the
USA and the firm sells the master franchise to sub-franchisor in specific locations. The master
franchise provides the right to open a specific number of McDonald’s outlets in a specific
geographical location and possess the right to see the franchise to another organisation or
individual (Redko and Semych, 2020).

Figure 3: Master Franchise Agreement (Odunsi, 2015)

2.3 Franchising in the UK Food industry

The food industry in the UK values more than £100 billion which is a golden opportunity
to increase within the novel market worldwide (Atradius, 2022). The food industry is the main
manufacturing sector of the UK that has employed more than 4 million individuals and generate
around £121 billion per year. This sector is the most important growth sector that overcome the
financial consequences caused due to Brexit. The food industry possesses a promising future
and has an excellent reputation. The sales of the food industry were up to £23 billion in 2020 and
are currently increasing (Santander, 2022). This sector gives expansion opportunities within the
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two different markets. United States is the largest food exporter of the UK therefore the sales of
the food industry increased by 16% in 2019 respectively (Atradius, 2022). UK is expanding its
market within the expanding markets including UAE, India, and Japan to get potential
customers. Premium food products have attained popularity worldwide (Santander, 2022).
It is expected that the food and beverages of the UK will be increased by 3% at the end of
2022 which was increased up to 4.1% in 2021 and 5.3% in 2020. The retailers of the food
industry are highly benefitted from the high demand over the past two years. The challenges of
food processors and producers are mounting because of the high input price. The processors and
food producers try to negotiate higher sales prices with their retailers and wholesalers (Atradius,
2022). Although the food industry in the UK is booming; therefore, this industry has exciting
franchise investment opportunities. The most well-known franchise opportunities in the UK food
industry are Tony Macaroni, Subway, and Wendy’s, Burger King, Chicken Cottage, and Slim
chickens. The franchising opportunities in the UK food industry can be availed as a short
business expansion solution (Redko and Semych, 2020).
2.4 Impact of Franchising on the International expansion
Franchising is the strategic way to decline the domestic demand dependence and grow
profit centers and future revenue worldwide (Alon, Apriliyanti, and Parodi, 2020). The brand can
be extended globally through franchising through low risks, minimal investment, and provision
of huge upside scaling potential capabilities. Franchising pool capabilities and resources to
complete strategic marketing, sales, and distribution goals within the firm (Rosado-Serrano,
Paul, and Dikova, 2018). The international expansion permits the firms to involve in overseas
markets and firms get the opportunity to expand their products with new customers. The
international expansion reflects that organizations should not spend money and time to recruit
full staff complement and relocate current staff into new areas (Bretas and Alon, 2021).
Franchises can be internationally expanded through documentation of their day-to-day operations
such as adaption of current operation manuals to optimize for the target location (Tien and Ngoc,
2019).
International franchising is a model that businesses can utilise to make higher success
worldwide. It includes franchises that mostly individuals buying the rights to run the business
utilizing the franchisor’s successful business model (Salamakha, 2021). It involves the rights to
utilize the franchisor’s trademark and brand. International franchising works similarly but the
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franchisor sells the rights within the overseas market. It permits the franchisor to increase
internationally without having physically stuck and operate in overseas locations (Rosado-
Serrano, Langobardi, and Paul, 2019). The success of an international franchise depends on
finding the right franchisees. The International Franchise Association is the best platform to
look for numerous markets overseas. The recruitment of central franchisees within each market
assists overseas, guiding and training the franchises within the varied markets (Arman et al.,
2019).
The franchises must identify the right markets to get success. Market research helps
businesses to be expanded within the right markets (Redko and Semych, 2020). Sometimes
businesses already attract foreign customers without being realized so the franchisors should
check the markets that are already interested in business offerings. Legal and regulatory
constraints are also important to understand. It is involved in running franchises that help to
identify issues. The problems manifest if the improper translated documents pertain to
trademarks, employee laws, product regulations, copyright laws, taxation, and insurance (Iddy
and Alon, 2020). Furthermore, franchises can be internationally expanded by providing good
levels of training. It is necessary to deliver a good level of training, especially within the early
stages of first franchises. The business should translate the legal documents and contracts into
appropriate languages that in turn build loyalty for international franchise-holders (Redko and
Semych, 2020).
2.5 Theoretical Background
2.5.1 Value Creation Theory
The value creation theory as provided by Tantalo et al. (2015) is based on the stakeholder
synergies and in that perspective these synergies are developed with two different considerations
as one is the provision or increase in the provision of value creation to one or more essential
stakeholders group simultaneously and the other is the continuous provision of the value creation
by already existing stakeholder of the company. It shows that the value creation is the process of
making balance between increasing synergies and already existing synergies. There is another
approach regarding the value creation theory which is related to the surplus of producer or
Stakeholder and in that approach of working on the main priority it has been observed that in
managing the business there are two types of considerations the variants and value creation
(Windsor, 2017).
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Understanding the market surplus it has been observed on the main idea the approach of
major considerations on which the relationship capabilities and marketing innovation has been
the main idea of approaches. There are different types of approaches in which the main idea of
working is based on the main idea of working due to which the value creation can be developed
effectively with the approach of development of good relationships and business innovations
(Sánchez-Gutiérrez et al., 2018).
2.5.2 Three-Stage theory of International Business Expansion
The three stage theory of international business expansion has provided the steps in
which the globalisation occurs and in that section of working the main idea revolves around the
expansion of business and its validation of sources in three different stages. The three stages
explain about how the companies going on the road of development provide the benefits with
loses as in these operations the benefits are important and in that approach the affordable
approach of working has been applied on the sectional consideration of working with the
inclusion of losses at first then an increased profit and afterwards the stability in the benefits for
the company (Buckley, 2016).
Thus employing on these sections the three stage theory is an ultimate approach for the
development and sharing of multilingual approaches in which the main working considerations
are about the possible and probable idea of business expansion (Lassere, 2017). There are some
sections in which the main working idea is about the maximum consideration regarding the
expansion of business to the international grounds and in that expansion the major importance
must be applied on the developmental approaches of globalisation. The three stage theory is a
structure for supporting the international expansion in three different steps evaluating the
benefits and problems working on the idea of development with the globalisation (Garyson et al.,
2017).
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Franchising
Value Three-
as a Smart
Chain Stage
Theory Business theory
Solution
2.6 Summary
In short, this chapter has been discussed thoroughly franchising as a smart business
solution by understanding its history, associated concepts, advantages, and disadvantages. Two
types of franchises have been discussed including business format franchising and production
distribution franchising in detail. Besides, the three different types of franchising agreements
such as individual, area, and master franchising agreements have been critically analysed. The
food industry of the UK has been discussed along with the role of franchising in this particular
industry. The association between franchising and international expansion has been discussed
with the help of supporting evidence. Two theories have been discussed such as the value
creation theory and the three-stage theory to get the theoretical background to develop an
understanding that how franchising is a smart business solution in the food industry of the UK.
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CHAPTER THREE: METHODOLOGY

3.1 Introduction
As understood from the study conducted by Lambert, (2012), a research methodology is
an important aspect of academic research as it inaugurates the measures and approaches for the
author to execute research in an appropriate way. The method of a research also helps in seeking
findings of relevant studies with the purpose of reaching towards an appropriate or feasible
conclusion (Carlin, 2016). To obtain substantial and acceptable results, researchers always
employ effective research methodologies within the time constraints. The following chapter
discusses research procedures that have been employed from a philosophical standpoint, as well
as some of the research design and methods that have been used to perform this study. Moreover,
the author has also discussed the procedure of data collection for identifying and evaluating if
franchising is a smart business solution for the food industry specifically restaurants for
achieving the international business expansion and examining the positive and negative impact
of franchising over the international expansion. The author has also discussed the method of data
analysis and techniques of sampling along with the discussion regarding the sample size that has
been used in this research.
3.2 Philosophy and Approach of the Research
The research philosophy explains the belief in the direction of a specific method
regarding the research and accumulation of data in a particular research. As understood from the
study conducted by Crossan, (2013) there are a certain kinds of research philosophies that are
used by the authors in various researches. For the purpose of current study, the author has made
use of the interpretivism philosophical approach since the primary motive of the author was to
analyse if franchising is a smart business solution for the food industry specifically restaurants
for achieving the international business expansion and examining the positive and negative
impact of franchising over the international expansion. The primary reason to select this
philosophy is that is takes the study in the direction of receiving the data on the grounds on the
basis of individual experience and opinion from various participants together with the mixture of
human interests like managers coming to the decision if franchising is a smart business solution
for the food industry or not.
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As far as the approach of the study is concerned, the author has made use of inductive
approach for the motive to confirm whether franchising is a smart business solution for the food
industry specifically restaurants for achieving the international business expansion.
3.2 Research Design
It has been analysed from the study conducted by, Babin, et al (2019) that the design of a
research is an extremely significant fragment of the methodology of a dissertation. It is
recognised that it allows the author of the study to gather particular approaches and procedures
that are used in the study. In a research methodology, the design of the research is based on the
three types named as qualitative research design, mixed research design and quantitative design
(Creswell and Creswell, 2017). In light of the nature of the present study, the author has made
use of the qualitative research design. The primary reason to make use of this research design is
because it has helped the author of the study to examine the answers, attitudes and approaches of
the participant regarding the notion if franchising is a smart business solution for the food
industry specifically restaurants for achieving the international business expansion and
examining the positive and negative impact of franchising over the international expansion. In
addition to this, the selected design has also permitted the factor of openness in the study
together with the in-depth information concerning the topic of the study. Moreover, another
reason for making use of this research design is because it has allowed the author to gather
individual insights and experiences of the participants who are likely aimed to expand the
companies (Glesne, 2016).

3.4 Data Collection Method

The methods through which data and information from the research study is acquired,
including the information sources used to gather the data, are referred to as research data
collection methods (Thompson, et al., 2021).   Data collection method consists of two subgroups:
primary data collection and secondary data collection. Since this research relies heavily on
primary research work, the researcher has used primary data collection method in this
circumstance. The key justification for employing primary data collection in this study is that
primary sources provide all the comprehensive, dependable, and reliable data and information
(Press, 2018). In addition to this, it has been found that the data in the primary method is
acquired directly from sources such as group discussions, surveys, and interviews, ensuring that
the researchers have a greater accuracy. Additionally, this strategy allows the author to
 22

concentrate on the challenges of the research. With the help of this method, the researcher can
then lay emphasis on the research question and gather more up-to-date and concrete information
pertaining to the current research issue by obtaining information via primary sources.
3.5 Data Analysis Technique
Various methods and procedures are utilised in researches for the motive to examine and analyse
the data and information in an educated and efficient manner in order to meet the objectives of
the study. In context to this, the author of this study has made use of a variety of methods and
approaches to analyse and examine data and information in order to successfully analyse the
material gathered throughout the research investigation. The technique which has been used by
the author for analysing the data in the present study is thematic analysis. It's a method of
simulating data in an organised format while taking relevant themes into account based on
common replies gathered during interviews. (Vaismoradi and Snelgrove, 2019). For this study,
thematic analysis is chosen since the author has employed the tool of interview. Moreover, since
this technique also offers a flexible method that can be adapted in accordance to the requirements
of the study and offers a detailed, comprehensive presentation of data and information.
3.6 Sampling Size and Technique
As per the study conducted by McFarland, et al., (2018) sampling in a study is regarded as
the technique or process through which a particular group from a population data is chosen in
accordance to the projected sample size for gathering information. For the motive of present
study, the researcher has made use of the non-probability sampling by employing the technique
of purposive selection. The primary justification of making use of this sample method is that the
researcher can depend on his own decision during the selection of the participants for the present
study. Moreover, another justification for making use of this sampling technique is that it was
appropriate at the time there is a restricted amount of primary data sources that can contribute to
the study. It is also the more efficient sampling method in terms of time and cost (McFarland, et
al., 2018). Furthermore, the size of sample in a research study refers to quantity of interviews
executed for the research. Therefore, the data in the present study has been collected after
interviewing 10 respondents. The participants in the present were selected to be 10 since the
author was short of time and conducting interviews is a long and time consuming procedure.
Hence, 10 most relevant and diligent participants were selected. Moreover, the participants of
the study were the employees and managers of small food businesses who likely aimed to
 23

expand the companies. The study has not included the children, the elderly, and people with a
learning disability. As the core aim was related to the franchising of small businesses that is
based on managerial decisions
3.7 Ethical Considerations
The most crucial aspect of a research study that the author has addressed when performing
the study is ethical issues (Navalt, et al., 2019). Ethical issues play a crucial impact in the
validity and reliability of research, according to a study (Arifin, 2018). Because it emphasises the
moral ideals and standards that are upheld throughout the research process. In light of the present
research, the researcher of the study has made sure that none of the participants involved in the
procedure of interviews were harmed, either psychologically or physically. This was made sure
through offering well-versed consent in the course of the recording of the interviews with the
participants. The respondents could also end the interview whenever they chose without being
questioned or having to provide a solid explanation, according to the author. The respondents
were kept anonymous by the researcher, who did not collect any personal information about
them other than their age and gender. After the combined content has been edited, all audio
recordings are taken apart to preserve secrecy. The information and data, on the other hand, are
stored on the author's computer and are protected by a strong password.
3.8 Limitations of the Study
According to the study conducted by Emerson, (2021), limits are a significant component of the
study because they serve as a signal of gaps and areas where future researchers should focus their
efforts. Another researcher stated that limits are the cause of identifying the bounds of the
following research's findings. However, these limitations show the need for additional study and
advancements in the following field (Ross, and Zaidi, 2019). In light of the present study, there
are certain limitations that were experienced by the author of the present study in the course of
the study's implementation. Time and financial limits were amongst top in these restraints.
Moreover, another limitation that was faced by the author in conducting the interviews was the
respondents' busy schedules, which made it difficult to attend to each one individually. In order
to delimit this, the author of the study conducted interviews on slot basis, in this way he was able
to give equal to time to everyone. On the other hand, this study is limited by the fact that it is
based on qualitative results. However, since the primary emphasis of the study was on primary
 24

data gathering methods, the results are confined to that area only. As a result, the author
discovered several flaws when doing the research.
 25

CHAPTER 4: FINDINGS AND DISCUSSION

4.1 Introduction
In this chapter, the findings and conclusions of the study, in addition to linkages to earlier
research and relevant literature, are presented (which has covered in the literature review
chapter). In order to provide evidence in support of their findings, researchers often assess the
applicability and/or usefulness of their findings in relation to the field of research in which they
are engaged. The responsibility of engaging with and explaining the findings of the study in a
manner that is both thorough and consistent falls on the shoulders of the researchers. In order to
assess whether or not the study was successful in meeting its objectives, this chapter applies
theme analysis to the qualitative data that was collected. In this chapter, a number of different
themes are established in order to expand on the issue that is being discussed.
4.2 Thematic analysis
Thematic analysis is a kind of qualitative data analysis that involves analysing the data to
discover meaning patterns and extract themes. For example, if a researcher have transcripts from
in-depth interviews or focus group talks, they may use thematic analysis to analyse the data
(Sadeh and Kacker, 2020). Thematic analysis necessitates making an active effort toward
introspection on the part of the analyst. The individual experiences and points of view of the
researcher are absolutely necessary in order to derive meaning from the data. Because thematic
analysis is unsupervised, the researchers do not need to construct these categories in advance,
they do not need to train the algorithm, and they may readily find unknown unknowns.
Additionally, the researchers do not need to train the algorithm. Thematic analysis is a flexible
tool that, when used in qualitative research, facilitates the identification of unique ideas and
views based on the findings of the study. The simplicity of theme analysis may be beneficial to
novice researchers who are just starting to comprehend how to analyse qualitative data. These
researchers may be just beginning to understand how to do data analysis. Following are the
designed themes according to which the collected data for the conducted research study is
analysed systematically to produce profound results.
4.2.1 Theme 1: The Role of Franchising For International Franchisors
In the modern global economy, franchising is a well-established form of corporate
organisation that is assuming an increasingly important role. Divestment measures made by
states and publicly owned enterprises are a significant factor contributing to this trend. A number
 26

of nations that are still in the beginning stages of economic development have turned to
franchising as a means of fostering economic expansion (Rosado-Serrano, Paul, and Dikova,
2018). The findings of the study has demonstrated that it is possible to establish new
employment possibilities and streams of revenue in a more expedient and efficient manner via
the use of franchising. According to the findings, the percentage of "conventional" companies
that fail is often higher than that of franchised businesses. This is the conclusion that is arrived to
as a result of the outcomes of the conducted research. However, research has shown that,
depending on the state of the economy in general, the growth of franchising might potentially
have a significant impact on the growth and prosperity of the economy as a whole. It is very
important to keep in mind, before to making an investment in a franchise, that there is a
possibility of suffering a financial loss and that franchising is not an only way out.
It is observed that the franchising has seen increased appeal as a result of its ability, if it
is handled well, to be beneficial to all parties involved. According to the response of the
respondent is it observed that “the franchisor and franchisee are interdependent in the same way
that partners in a business partnership are, with the franchisor depending on the franchisee to
carry out specific responsibilities on its behalf. It is the franchisees, not the franchisor, who are
ultimately accountable for a franchise's level of success. In addition, franchisers are required to
keep a close eye on the activities of their franchisees to ensure that the reputation of the brand is
not damaged by the conduct of even a single franchisee”. The supply of resources such as an
information system, training, and an operating manual helps to achieve this goal. The results
showed that both franchise owners and franchisees have a vested interest in ensuring that their
operations are as successful as possible; hence, they need to cooperate in this endeavour (Redko
and Semych, 2020).
The findings of the study has demonstrated that when analysing the pace of expansion of
the franchise system, it is essential to investigate the factors that contributed to the quick
acceleration of franchising's growth as a vehicle for the development of small and medium-sized
businesses. Due to the fact that franchising as a method for starting up small and medium-sized
enterprises is still a relatively new phenomena, this is of the utmost importance. The response
from the selected respondent encoded that “the franchising an innovative business idea does not
seem to be the most effective technique for achieving growth. This is true when considering both
profitability and ownership of the business. When compared to other methods of extending a
 27

firm, such as acquiring another company, franchising requires a relatively little financial
investment from the franchisor. Because franchisees provide the required funds and labour to
administer the firm, the franchisor has the potential to turn a profit while having a relatively low
cost base. In many cases, the decision to start a franchise is influenced by the strong working
relationship that exists between the franchisor and franchisee”
It is further observed that when an established and tested company strategy is already in
place, the likelihood of attaining success is significantly increased. The product, the service, and
the operational processes for the company are all already in place. Therefore, since food industry
believe that successful franchise networks have a lesser chance of defaulting on their customer
loyalty, they are willing to provide more credit to such networks (Bretas and Alon, 2021). The
public, on the other hand, is already familiar with the company's reputation and can easily
identify its brand. Customers like doing business with organisations that they are already
acquainted with and in which they have faith. Franchise companies often provide its franchisees
significant training and support in order to facilitate their expansion and success (Salamakha,
2021).
There are instances in which huge franchisors market their goods and services on a
national scale in addition to the local one. Although this tactic will result in an increase in
income for all franchisees, the expense of implementing it will not be shouldered by the
individual franchises. Establishing a franchise may be rather expensive. Additionally, the
respondent proclaimed that “franchise owners are required to pay continuing royalties, which
reduces their margins of profit. Because doing so helps to keep things somewhat consistent,
franchisors almost always insist that their franchisees abide by the operations manual. This
places a significant restriction on the franchisee's ability to express themselves”. Therefore, it is
essential that franchisees pay a great deal of attention to detail in order to preserve the reputation
of the brand and the standard of service that they have developed. The ability of a franchisee to
be successful may be hindered if they are unable to manage a respectable business or do not have
enough financial resources.
It is further observed that franchisees need to exercise caution around franchisors that
don't provide enough support for their businesses. In addition to this, they might end up making
poor decisions that are detrimental to the franchisee (Rosado-Serrano, Paul, and Dikova, 2018).
It is essential to carry out exhaustive research on any potential franchise opportunity that a
 28

business is thinking about investing in before signing any agreements. By investing in an already
successful franchise, aspiring company owners have the opportunity to test the waters of the
commercial world with little risk. Franchises provide their customers with a tested and validated
business model to follow, in addition to help in key areas such as finance and training.
International franchises may provide a means for franchisees to capitalise on the expansion of the
worldwide market; but, in order to do so, they will need to overcome difficulties associated with
local cultures (Redko and Semych, 2020).
4.2.2 Theme 2: The Efficacy of Franchising as a Smart Solution for International Expansion in
Food Industry
A company has the potential to profit from franchising in any direction it goes.
Franchisors have the benefit of being able to swiftly incorporate new firms in a variety of places,
which might be to their advantage. The parent company is able to grow without incurring the
extra financial risks that would be faced if it built other sites on its own, therefore the company
does not have to take on any more financial risks in order to facilitate the expansion (Bretas and
Alon, 2021). The ability to expand at a more rapid pace is the primary benefit of using the
franchise business model for the operations of the firm, which also happens to be the most
important advantage. In addition to the advantages that were discussed above, one of the
respondent stated that “being a franchisee gives you the feeling of being an integral part of a
well-oiled machine that functions as a single unit. Because you will get help as a franchisee,
there is a possibility that this may contribute to the success of your company”. In addition, the
franchisor will provide support in the areas of promotion and marketing for the company.
Advertising and marketing are very important activities due to their capacity to both keep
existing customers and bring in new ones, both of which will assist to the development of the
company. Because of the practical knowledge and expertise they get from running their own
businesses, business owners who have invested in franchises have a better chance of enjoying
sustained financial success. This is an additional point to take into account. The relationship
between the franchisor and franchisee is one that is beneficial to both parties. It is not possible to
employ one independently of the other.
One of the selected respondent of the study has demonstrated that “business that makes
use of franchising may be in a position to benefit from the solid reputation of the brand owned
by its franchisor. Because of this, the franchise is able to accurately predict his success and cut
 29

down on the probability of him failing. Because the franchisor is responsible for delivering these
services, the franchise does not need to pay for any kind of training or assistance because it is
included in the package”. In addition to this, it is observed that a franchisor may provide a
franchisee the exclusive right to sell that franchisor's products within a certain geographic region.
Franchisees get training on the operational processes as well as the competitive advantages
offered by a variety of enterprises.
In the case of food industry, the brands have the opportunity to lessen their dependency
on the demand in their immediate area while simultaneously expanding their global profit centre
and future revenue potential by establishing franchises as illustrated by Alon, Apriliyanti, and
Parodi (2020). It is possible to broaden a brand's presence all over the globe by means of
franchising, which carries with it a low risk, low cost, and significant scalability advantages.
According to the recorded response of the respondent “there is a possibility that franchising will
prove to be a more effective method of accomplishing the strategic marketing, sales, and
distribution goals of the firm. When a company expands its activities into other countries, it
opens up the possibility for the organisation to engage in more markets and to obtain new
customers. For the sake of accommodating global expansion, companies should not spend the
time and money that are required to recruit and transfer whole staff complements as well as
relocate current people”. It is essential to provide detailed documentation of the day-to-day
operations of a franchise, including modifying any existing operational manuals in order to tailor
them specifically to the target audience when it comes to international expansion of the brands
regardless of the industry (Tien and Ngoc, 2019).
The study has further analysed that it's possible that using a business strategy like
international franchising might help a firm achieve higher levels of success on a worldwide
scale. In general, it refers to companies that provide franchisees with the opportunity to run their
own businesses based on a tried and established as well as successful business model that has
been developed in the past. The respondent has demonstrated that “worldwide franchising is
nearly identical to domestic franchising, with the key difference being that the franchisor gives
the licence to operate in global markets. It offers the franchisor the opportunity to grow their
business on a global scale without the need to physically set up shop and do business in other
nations (Rosado-Serrano, Langobardi, and Paul, 2019). To ensure the smooth operation of a
global franchise, it is essential that the right workers be recruited and hired by the organisation.
 30

Access to a plethora of different overseas markets is made available via the Foreign Franchise
Association (Arman et al., 2019).
The findings of the study has stated that “the proper selection of markets is very
necessary if one is hoping to ensure the success of the franchises. Conducting market research
enables organisations to more effectively grow into the most lucrative areas that are currently
accessible”. There are times when businesses already have worldwide customers but their
owners are unaware of this fact. Because of this, franchisees should try to set up shop in regions
where their parent firms already have established customer bases. A comprehensive
understanding of the legal and regulatory restrictions is also something that is very necessary. In
order to identify issues, it monitors franchisees that are part of a larger network. The relevant
papers discuss a variety of themes, including copyright law, product limits, employment rules,
and trademarks (Iddy and Alon, 2020). Additionally, franchisors have the opportunity to expand
into foreign markets by providing intensive training to their franchisees. It is essential to give
sufficient training in the beginning stages of the expansion of the first franchisees in the food
industry so that quality services and products can be provided to the customers. The study has
further analysed that in order to develop a profound international franchising business in the food
industry the contracts and other legally binding documents should be translated into the local
languages of international franchisees, which would increase their level of commitment to the
parent firm.
4.3 Discussion
The business of franchising food business internationally is considered one of the most
interactive aspects that enables them to achieve their international expansion. But as the literature
developed certain aspects are required to be considered for the development and formation of
existing business franchising internationally (Rosado-Serrano and Paul, 2018). As the data
collected through primary and secondary resources depicts that franchising is required to analyse
the key areas of concern during expansion to make their business profitable. Among such terms
franchising a brand is considered one of the key aspects of concern that is depicted from the
literature that it requires to effectively perform their work concerning building a strong image
among their consumers (López-Fernández and López-Bayón, 2018). It requires a recognised
name that consists of a strong brand image and the use of smart marketing strategies in the
franchise business for its success.
 31

Furthermore, the awareness of the brand among new customers is very important and
required to be developed in a well-mannered structure. Because such development and
recognition of brand enable franchise businesses to build customer recognition as it helps them in
different ways to improve their competitiveness and ensure their business survival in the global
market (CHUN et al., 2020). Such an aspect becomes more prominent when a customer buys
their products or services of products that are based on the franchising of their business. As the
emphasis is quite high on a brand that needs to be well-known because of the reason that
customers tend to buy the product from a brand they know well so in this regard it is very
important for the business while franchising internationally to expand its name and awareness
among customers to help in their profitability.
The uniqueness of the brand is another important aspect that is required to be discussed
because it is important for the business while franchising its operations internationally. Because
recognition and enhancement are developed through the uniqueness of the brand which in return
enables them to become capable of producing higher loyalty of their customers (Simon et al.,
2018). Focusing on the current trends indicates that many customers are considered inclined
toward the uniqueness of the brand and their attraction towards the franchising of the brand.
Because such sort of uniqueness and abilities enables the organisation in any way to deliver their
services with quality concerning the demand of their customers. To have a unique and whispered
market expansion such philosophy of working and abilities leads to their uniqueness among their
competitors and differentiates them in the market (Clinton, 2018). As the primary focus of
business is on the international market such development and adoption lead to their competitive
advantage when customers know that the franchiser brand is good in terms of their services or
products.
The findings of the study has proclaimed that when run well, company franchises have
the potential to provide significant financial returns for their owners. If a business already have a
lucrative product line and established business tactics, they have an advantage over competitors
who are establishing brand-new businesses. When they acquire a franchise, they are provided
with a significant amount of help and training in order to guarantee that franchisees get off to the
most successful start possible (Orgonáš, Paholková, and Drábik, 2020). However, there is no
getting around the fact that business continues as normal; this fact cannot be denied. In addition,
challenges will always be there in the business, notwithstanding the field in which industry it
 32

lies. It is observed that investing in a franchise, mitigates the inherent dangers that come with
figuring out how to run a business on its own for a company. Even when building their
businesses on an already proven formula for success, franchisee owners are required to put in the
appropriate amount of time and effort to secure the prosperity of their companies. Even if one
own a business that is a part of a franchise, they still need to be ready for the normal difficulties
that arise in line of work (Sadeh and Kacker, 2020).
It is possible that prospective franchisees may be required to reveal their net worth in
order to meet the financial obligations involved with running a franchise business. Because
franchising is a kind of company, businesspeople who own franchises want to make sure their
money is well spent on franchisees (Sadeh and Kacker, 2020). Before looking for franchise
opportunities, franchisees should first educate themselves on the prerequisites for owning and
operating a franchise successfully. It is necessary for the executives of a small company to have
a comprehensive understanding of the business in order for the company to be successful.
Franchisees are faced with the same challenges. Even for franchisees that have access to a large
amount of help and training, the process of learning new roles and responsibilities may be
challenging (Orgonáš, Paholková, and Drábik, 2020).
The fast-food industry is one of the growing businesses which includes a range of product
lines to make their customer aware of their tastes and uniqueness. But the most important part
that is required to be considered in this section is the location of the business that needs to be
selected by following the same principles of the uniqueness of which the product of the
organisation is developed (Alon et al., 2017). Many researchers and respondents of this research
claim that the location of the business in this regard is considered the key aspect and plays a vital
role in promoting the franchise business in the global market (Lee et al., 2015). To master
franchise customers, it is required to select the most effective and appropriate location that can
help in attracting their customers. Because in the food industry the location of the business is the
key aspect that plays a vital role in the profitability and attraction of customers.
Moreover, the location of the business as mentioned needs to be decided on exceptional
marketing of their products or services. In terms of the food industry and franchising business
internationally success requires selecting the busiest location because it can provide numerous
advantages to their business as it including to provide effective marketing exposure and
increased revenue (Wingrove and Urban, 2017). A busy area and the availability of ample foot
 33

traffic are among the most important factors in the success of a franchise business. The aspect
which is considered quite clear is the franchisors used to study the market and the proposed
location from their prospective franchisees before agreeing to propose the location to enter the
international market (Mardiana and Malau, 2020). It is quite a requirement for franchising the
business to analyse the facilities as well which creates an impact on the businesses as those
facilities help their customers to reach quite easily. It requires analysing facilities like public
transportation, parking areas, and many others that can help in attracting customers.
The key role of such an aspect is considered very important because it also attracts the
ability of franchisors in their market for the brand and most importantly the competition, they
face with existing business is quite effective to consider. During the market research of
franchisers between countries is believed that the primary focus in such terms is on demographic
patterns to determine their appropriateness for the location regarding opening their new franchise
(Gharaee et al., 2019). And also it relates to their strategic location where most of the franchisors
in this regard invest the healthy amount to acquire competitive facilities rather than in locations
that are at time considered not suitable for the products and services they are offering in the
market. The differentiation of products in this regard is key where the effect of location becomes
mild and innovation in the product becomes more important for their customers (Smith et al.,
2018). The marketing strategy of the organisation that stands tall with the inclusion of
respondents becomes effective for making innovations in the products and offers distinctively in
the international market.
The second objective of the present study aimed to review and understand the nature of
challenges and failures experienced by the existing franchisors in the food industry. In light of
this, it has been evaluated and assessed through the findings that in the fast food industry,
franchising plays a significant part in the expansion of entrepreneurship around the world. In
addition to this, it has been recognised that businesses in the fast food industry utilise franchising
as a business model to establish their own enterprises by partnering with well-known brands and
to extend their operations. The study conducted by Sanghavi (1998) also relates that the growth
of franchising is dependent on the country's overall economic and political conditions, as well as
its growth can be considerably influenced by the economy's overall performance. As a result, it's
important to remember that franchising might fail and that it is not a cure-all for problems in the
development of plans. It has been identified that owners of franchises can suffer major financial
 34

consequences as a result of a lack of communication. Modifications from the corporate level can
seep down to individual restaurant owners without clear communication or input, limiting
franchisees' ability to voice issues and allowing little time to make improvement strategies to the
inventory, sales predictions, and procedures. In addition to this, it has been assessed that the
issues of costs and royalties is another significant issue that needs attention. the study conducted
by Alon, Apriliyanti and Parodi, (2020) has shed light that built-in brand recognition offers great
advantage to the franchisees from their restaurants, but unfortunately there is a certain price that
they have to pay. On top of an initial license fee, franchisees must pay regular royalty fees to
franchisors. It is either fraction of a percent or business expenses for marketing functions
throughout the board. In addition to this, it understandable that not all franchisees are pleased
with never finishing check cutting. Franchisees who are sluggish to start or have a tough month
might not have been capable of meeting their agreement dues when the contribution is fixed. A
percent-based royalty charge may appear punishing to successful franchisees, because the more
money an individual makes, the greater the check they are expected to send to their corporate
(Bretas and Alon, 2021).
 35

Chapter 5

Introduction to Chapter 100

This is a common and realistic assessment in today's world of innovation, technology,
and advancement, which has experienced significant growth in the commercial sector on a global
scale. It is typical practice for organizations to raise brand recognition in order to recruit new
clients in foreign markets and meet worldwide demand. A large number of organizations utilise
the franchising procedure to get access to new foreign markets in a range of locales across the
globe. Those that are just starting out in the industry can profit from acquiring a franchise in a
variety of ways owing to the many advantages that come with the move (Tien et al., 2019).

Summarized Findings 500

When you become a franchisee, you are given the sense that you are a vital element of a
machine that works well as a whole. This sensation follows you throughout your tenure as a
franchisee. It is conceivable that the aid of a franchisee may help your company succeed.
Moreover, the franchisor will support the company in the areas of promotion and marketing
during the term of the agreement. According to Bretas and Alon, (2021), using a commercial
strategy such as international franchising might help a company achieve better levels of success
on a global scale. The term franchising refers to a broad category of organizations that enable
others to operate their own businesses by using already established and profitable business
concepts. Global franchising is essentially comparable to domestic franchising, with the
significant distinction being that the franchisor grants the license to operate in global markets. It
allows franchisors to expand their company on a global scale without having to physically open
up shop and do business in additional countries throughout the world.
According to the study's results, one of the most crucial factors to consider when it comes
to ensuring franchise success is selecting the suitable markets (Salamakha, 2021). Market
research supports organizations in growing into the most profitable areas that are presently
available, writes the author. According to the study's findings, one of the most significant steps
in building a strong worldwide food franchising organization is to translate contracts and other
legally binding documents into the local languages of overseas franchisees (Redko and Semych,
2020).
 36

The study's results suggest that franchising might be used to create new employment
opportunities and income streams in a more effective and timely way (Rosado-Serrano and Paul,
2018). According to the research, regular enterprises have a far greater failure rate than
franchises. As a result of our inquiry, we came to this conclusion as a result of our research.
According to the findings of a franchising study, the expansion of franchising has the potential to
have a substantial influence on the growth and well-being of our economy as a whole. Prior to
making the choice to invest in a franchise, it is essential to consider the danger of financial loss
as well as the fact that franchising is not the only way accessible (Sadeh and Kacker, 2020).
According to the study's findings, using a commercial strategy such as international
franchising might help a company achieve better levels of success on a global scale (Tien and
Ngoc, 2019). The term franchising refers to a broad category of organizations that enable others
to operate their own businesses by using already established and profitable business concepts. By
giving extensive training to franchise owners, franchisors may extend their operations into
worldwide markets. Only if the initial franchisees in the food industry have enough training early
in their growth will they be able to give excellent services and goods to their clients. According
to the study's findings, one of the most significant steps in building a strong worldwide food
franchising organization is to translate contracts and other legally binding documents into the
local languages of overseas franchisees (Salamakha, 2021).

Conclusion
The research has concluded that well-managed company franchises may provide their
owners with significant financial rewards. When your rivals are starting from scratch, having a
profitable product line and tried-and-true management practices may assist your organization
acquire an advantage. Franchisees get substantial assistance and training to help them get their
companies off to a good start. It is tough to overlook the fact that, despite the present political
turbulence, business is going on as usual. Problems will always happen no matter what industry a
company is in. Consider owning a franchise if you wish to avoid the inherent risks of
establishing your own firm.
The goal is to look at the present challenges and failures that food industry franchisors encounter.
It was researched and studied since it was discovered that fast food franchising plays a vital role
in dispersing entrepreneurial opportunities over the world. Franchising is utilized as a business
 37

strategy in the fast food industry to create their own enterprises by collaborating with well-
known brands and expanding their operations. This is done in order to grow their company and
recruit more personnel.
For the first time, experts investigated the possible effects on the food and beverage
industries and devised viable strategies to cope with such consequences. The findings of
researchers have a significant impact on theoretical frameworks as well as actual
implementations. By focusing on Bangladesh as a case study, we contribute not only to the body
of information on food and beverage sector disruptions, but also to the body of knowledge on
food and beverage sector disruptions in developing nations. As a result, we can better understand
the consequences of shocks in developing markets. The survey findings also show that the
executives in the food and beverage industries are better prepared to deal with.

Recommendations 300
It will be better to recommend that the world with a sustainable food system is still
vulnerable to negative food security outcomes. Moreover, the values change scenario family, the
step-changes required to produce a paradigm shift to a sustainable food system in 2050 are non-
trivial. Multiple scenarios are, therefore, recommended for food system actors to prepare for the
future with strategies that adequately hedge against uncertainty. The companies are well-
equipped with an omni-channel sales infrastructure, food and beverage companies in developing
countries are not yet able to take full advantage of such omni-channel sales methods. Therefore,
we recommend that food and beverage industry managers sell products not only via their
websites but also through other e-commerce interfaces.
The study makes a substantial contribution in these areas, a few limitations of our
research can be noted. First, the study used a case-study approach by drawing on data collected
via interviews. Although all the necessary steps have been undertaken in the research design
stage to improve the precision and reliability of the findings, nonetheless, the study lacks
generalizability due to the nature of the research methodology we used. Therefore, in the future,
a large-scale survey could be undertaken to verify the strategies provided in this research and to
increase the generalizability of the findings.
However, in the study, the interrelationships among the factors examined are on the
objectives. Finally, if there is conclusion that is drawn across this diverse selection of case
 38

studies, it is that international trade will be a crucial determinant of food system outcomes, both
for food security and sustainability. Yet, both the general and partial equilibrium modelling
approaches tend to smooth outcomes, based on a sequence of equilibria, which means that
potential trade shocks and resulting discontinuities in the food system are difficult to simulate.

Future Implications 100

These interrelationships must be included in any future study on the issue since they
might give crucial guidance for the creation of effective action plans. Another flaw in this
inquiry is that no effort was made to assess the relevance of the various approaches and effects
studied. It is probable that the firms, along with the rest of the industry, will need to fight to
recover from the pandemic. If this is the case, businesses will need to decide where they should
focus their resources. If further research is done to compare and contrast the relative
effectiveness of the various strategies, it may be able to make a better-informed decision in the
future.
 39

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