Regional Clustering, Matching Governance Mechanisms, and Performance Implications in Franchising

摘要

With a rapid growth of franchisee! outlets, regional clustering has been frequently employed by franchisors in expansion of franchise system. Building upon emerging literature on regional clustering and agency theory, this research aims to examine the financial impact of regional clustering of franchised outlets, in joint consideration with alternative governance mechanisms employed between franchisors and franchisees and among franchisees themselves. We first have a baseline hypothesis that there is an inverted U-shape relationship between regional clustering of franchised out- lets and franchisors' financial performance.