An empirical analysis of performance impacts resulting from conversion to franchise operations

Hesford, James (Ecole hôtelière de Lausanne, HES-SO // University of Applied Sciences Western Switzerland) ; Pizzini, Mina (Texas State University, and the Naval Postgraduate School) ; Potter, Gordon (Cornell University)

Franchising is an important form of organizational control. Possible benefits of franchising include its ability to reduce agency costs that increase with costly monitoring , and provide incentives for the use of local information by onsite managers . However, these benefits may come at a cost, as franchisees may reduce quality by choosing to free ride . While many studies have investigated the reasons for franchising, few studie s have documented the impacts of franchising on unit level operating performance . Using time - series data from a number of lodging properties that were converted to franchisee control from company control, this study documents the performance impacts of fra nchising. The analysis reveals that conversion results in a modest decline in financial performance and an immediate sharp decline in quality.


Note: Présenté à l'American Accounting Association Annual Meeting, 8-13 August 2015, Chicago, USA et à l'American Accounting Association Annual Meeting, Newport Beach, USA, 7-10 January 2015


Keywords:
Conference Type:
full paper
Faculty:
Economie et Services
School:
EHL
Subject(s):
Economie/gestion
Publisher:
Calgary, Canada, 15-17 June 2015
Date:
Calgary, Canada
15-17 June 2015
2015
Pagination:
28 p.
Published in:
Proceedings of the conference on Convergence of Financial and Managerial Accounting Research 2015
Appears in Collection:

Note: The status of this file is: restricted


 Record created 2015-10-23, last modified 2019-06-11

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