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Research
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| Author(s) : Carlos
Pestana BARROS, Rozenn PERRIGOT |
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Franchised
Network Efficiency: A DEA Application to US
Networks |
| Abstract |
| The concept
of performance has been little explored in
the franchising literature (Combs et al.,
2004; Watson et al., 2005). In this paper,
we explore the franchising network performance,
and more specifically the franchising network
efficiency, from the franchisor point of view
and through a DEA approach (Data Envelopment
Analysis). Two main indicators of the franchisor
revenues are used: the on-going franchising
royalties and the franchising fee. The purpose
of this paper is built into an efficiency
perspective. Data concern the first 150 franchising
networks of the Entrepreneur’s 25 Annual
Franchise 500® ranking (2004). The findings
indicate that most of the networks are under-efficient
and one of the main reasons for this stems
from scale efficiency. A particular network
is also studied in depth. Moreover, four hypotheses
are empirically tested. Implications of the
study are finally discussed. |
| EMNET
Conference, September 2005 |
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