Does origin matter? The impact of the institutional environment of the origin country on the internationalization of franchise chains
ISSN: 1525-383X
Article publication date: 11 September 2020
Issue publication date: 7 January 2021
Abstract
Purpose
The purpose of this research is to identify the impacts of the country of origin of a franchise chain on its commitment in the destination countries, verifying the institutional particularities between the chains from emerging and developed countries.
Design/methodology/approach
The research is descriptive and quantitative and involved 724 franchise chains from 10 countries of origin (Brazil, Russia, India, South Africa, Argentina, USA, Germany, Australia, Spain and Portugal), spread over 174 destination countries, totaling 3,513 cases.
Findings
The results indicate that institutional preferences do not vary according to the country of origin of the franchise chain but rather vary according to the destination country.
Research limitations/implications
This paper contributes to institutional theory by identifying a set of characteristics that explains the selection of international markets and the commitment of franchise chains.
Practical implications
The results obtained in the study can help managers of franchise chains to make decisions related to the selection of destination countries for international expansion based on the institutional characteristics of the markets and their compatibility with the objectives of the franchise chains.
Originality/value
Companies in emerging countries internationalize according to different management logics from those of companies from developed countries. Thus, it is possible that the process of selecting countries for internationalization is also based on different criteria that reflect different institutional preferences. The thesis defended in the paper is that market potential is more important to franchisees from emerging markets, whereas contract enforcement is more important to franchisees from developed markets.
Keywords
Acknowledgements
This study was financed in part by the Coordenação de Aperfeiçoamento de Pessoal de Nível Superior – Brasil (CAPES) – Finance Code 001.
Citation
Lanfranchi, A.G., Strehlau, S., Borini, F.M. and Melo, P.L.d.R. (2021), "Does origin matter? The impact of the institutional environment of the origin country on the internationalization of franchise chains", Multinational Business Review, Vol. 29 No. 1, pp. 96-115. https://doi.org/10.1108/MBR-01-2020-0020
Publisher
:Emerald Publishing Limited
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