The impact of franchising on the financial performance of small firms
Article Abstract:
The objective of this study was to examine the relationship between form of ownership (independent vs. franchise) and financial performance of a select group of small, mature firms. MANOVA and ANOVA tests failed to identify significant performance differences. Recommendations for future research studies are mentioned. Venturing into a small business is risky. Approximately 400,000 small businesses fail each year (The State of Small Business 1986). A conservative estimate of the failure rate of start-up firms in their first 5 years is close to 65% (Hodgetts 1982). Between one-quarter to one-third fail in their first year of operation (Small Business Reporter 1986). However, many would-be entrepreneurs minimize their business risk by purchasing a franchise rather then starting from scratch. In contrast, only about 2.5% of franchise-owned outlets discontinue operations per year, many for reasons other than economic ("Franchising is Management for Success" 1986). (Reprinted by permission of the publisher.)
Publication Name: Journal of the Academy of Marketing Science
Subject: Business
ISSN: 0092-0703
Year: 1986
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Planning and financial performance of small, mature firms
Article Abstract:
The relationship between financial performance and planning sophistication of a group of small, mature firms is examined. Three variables are found to influence financial outcomes: the management philosophy of the firm, the degree of planning sophistication, and the environment in which the firm operates. Multivariate analysis identifies significantly different financial performance between firms that have formal planning structures and those which do not.
Publication Name: Strategic Management Journal
Subject: Business
ISSN: 0143-2095
Year: 1986
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