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The authors conduct a structured analysis of the literature on the determinants of economic and financial franchise performance and develop an integrative framework that unifies the literature from franchisor as well as franchisee perspectives.

53 relevant research articles on economic and financial franchise success published between 1976 and 2020 were identified. After providing an overview of the empirical methods and theoretical perspectives found in the literature, an original classification system of franchise success determinants was developed.

More than 50 different variables impacting economic or financial franchise success were identified and grouped into ten distinct categories. The most impactful categories are the franchise relationship, franchisee characteristics and capabilities, franchisor variables and the franchise environment. The study’s integrative framework illustrates not only the impact of these factors on franchise success, but also reveals which areas require more attention.

As the study focused on understanding the determinants of franchise success, any measures related to franchise failure were excluded. Also, the role of venture capital and stock market listing as growth strategies in the franchise sector were excluded.

The study’s framework shows how the management of franchise success is complex and that franchise relationship, franchisee and franchisor variables as well as the franchise context need to be taken into account. It illustrates that there is a hierarchy with which these determinants should be prioritized.

The article proposes the first systematic review of the literature on the determinants of economic and financial franchise success. The contribution offers both, researchers and practitioners, new and useful insights for future knowledge development in the field.

We adopt the conceptual lens of the Dynamic Capabilities Approach to evaluate the relationship between Entrepreneurial Orientation (EO), Digital Marketing Capabilities (DMC), and Performance in Brazilian franchises.

We applied a survey with franchisors at the Brazilian Franchising Association Expo 2022. Data were collected for 145 franchise systems. We used Partial Least Squares Structural Equation Modeling and tested two distinct models. Model 1 presents the direct effects of EO and DMC on Performance. In Model 2 we include the mediation effect of DMC on the relationship between EO and Performance.

Aligned with prior literature, in our first model we found a direct association between EO and Performance and between DMC and Performance. In our second model, when analyzing the combination of EO and DMC, we observed a full mediation effect of DMC in the relationship between EO and performance, and an indirect effect of EO on performance.

We advance in the debate of the relationship between EO and Performance in the franchise context, adding to our model the DMC perspective. Findings shed light on the importance of digital marketing capabilities for franchise systems. These elements open important avenues for dedicated research to further understand how digitalization process can be redefining the drivers of performance in entrepreneurial firms.