Using Franchising Tool as a Growth Strategy by US Food Chain Franchisors - A Case Study of Food Chain Franchises in the Middle East

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Topic Approval Form

What specific topic or subject area do you propose to explore?

My field of specialization is International Business. I am planning to have the dissertation done in the field of Franchising as that is my job responsibility for the past few years.

What is your working title?

Using Franchising Tool as a Growth Strategy by US Food Chain Franchisors - A Case study of Food Chain Franchises in the Middle East

What is the theoretical foundation for your work?

The theoretical framework for this study was formulated from the resource-based theory of the firm and its analysis in relation to franchising in emerging markets. With this theory, the performance and success of the firm are determined and driven by the quality and quantity of its resource portfolio (Morris, Kuratko, Allen, Ireland, & Schindehutte, 2010). Each company has a unique set of tangible and intangible resources and capabilities that are acquired, developed, and expanded over time (Esteve-Perez & Mafiez-Castillejo, 2008). These unique or distinctive resources that are possessed by the firm are used to develop a sustained competitive advantage in the market (Knott, 2009). Franchisors use different resources (Spinelli, 2007) and adopt various strategies (Preble & Hoffman, 2006) to establish successful franchise systems in emerging markets (Khan, 2005). Under the resource-based school, the competitive advantage of a company is established through an accumulation of unique resources, capabilities, and knowledge (Cater & Cater, 2009). These resources are strategically aligned with the company's core capabilities and competencies to produce a better product or a different product to satisfy consumer needs. By combining resources, capabilities, and competencies, company managers can make superior products thereby establishing a unique place in the market. Increased market share is developed through the continual supply of better-valued products to the market (Smith, 2008). In order for smaller companies to survive in competitive environments, managers need to identify the firm's unique resources. The managers of smaller companies also need to strategize based on these resources to provide a foundation for sustainable competitive advantages. Small business owners should also recognize the potential value of their non-monetary resources (Runyan, Huddleston, & Swinney, 2007).

Chan and Justis (1990) studied the potential for franchising in Asia. The study found that the economic growth in the Asian Pacific region presented huge amount of opportunities for the U.S. franchises. The study also suggested several franchising strategies that can be adopted by firms in the East Asia. These strategies include the establishment of a master franchisee, licensing, joint venture, direct investment and establishing a franchising agreement with the local government as franchisee. Chan and Justis (1990) suggested that these strategies can be adopted by US firms to expand into East Asia. However, firms must understanding the local culture and foreign regulations before moving towards franchising. The current study will also examine the suitable franchising strategies that can be adopted by US firms as a growth strategy into the Middle ...