The role of company support in franchisee willingness to pay a premium and referrer behaviour

Meiling Gao and Jiseon Ahn

Current Issues in Tourism, 2024, vol. 27, issue 18, 3030-3042

Abstract: With increasing competition in the food franchise industry, the success of a franchise operation depends on its ability to instigate franchisee patronage. This study focuses on franchisor characteristics that help in creating positive behavioural outcomes. Partial least squares structural equation modelling (PLS-SEM) using SmartPLS software is used to analyze 266 U.S. food franchisees. Findings show the relative impact of franchisee evaluation of information quality, service quality, rewards and recognition, and customization on perceived value. Also, positive perceived value in franchisees influences their willingness to pay a premium and their referrer intentions towards franchise brands. Multigroup analysis using demographic characteristics shows that the impacts of information quality and service quality on perceived value are higher in male and older franchisees than in female and younger franchisees. In contrast, the effect of customization on perceived value is greater in female and younger franchisees. This study provides insights to develop business strategies.

Date: 2024
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DOI: 10.1080/13683500.2023.2265034

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