Exploring the influence of channel leadership style on channel commitment in a franchising context

Abstract

Purpose

This paper aims to explore franchisor–franchisee relationships in the context of plural forms. Plural forms implies the co-existence of franchised and non-franchised outlets of a given company. More specifically, the paper examines the impact of franchisors’ leadership styles on franchisees’ relationship commitment when the company franchised outlets co-exist with independent non-franchised outlets. Specifically, this study operationalize the plural forms phenomenon in franchising, using multi-channel complexity as a moderator. The mediating role of relational capital is also examined.

Design/methodology/approach

Data were collected from 254 franchisees. The hypothesized model was tested using partial least squares structural equation modeling (PLS-SEM).

Findings

The results indicate that all three – participative, supportive and directive leadership styles of franchisors increase relationship commitment. In a high channel complexity context, a supportive leadership style is the most effective, whereas, in a low channel complexity context, a participative style is the most effective. Relational capital also partially mediated the relationships between leadership styles and relationship commitment.

Practical implications

Franchisors should follow a participative leadership style when channel complexity is low. However, as they add new channels and the channel complexity increases, franchisors should shift toward a supportive leadership style to maintain existing franchisees’ commitment. In current environments, managers should avoid using directive leadership in favor of the other two leadership styles.

Originality/value

The present study is the first to examine the influence of channel leadership style on relationship commitment in an environment of multiple channel complexity.

Citation

Sharma, D., Patel, S.S. and Pandey, S.K. (2021), "Exploring the influence of channel leadership style on channel commitment in a franchising context", Journal of Business & Industrial Marketing, Vol. 36 No. 8, pp. 1415-1434. https://doi.org/10.1108/JBIM-02-2019-0089