Why McDonalds is Attractive to Franchisee Investors

Abstract

Previous exploratory and explanatory research into the factors influencing an individual's decision to purchase a franchise has largely focused upon the franchisor's perspective, with comparatively less attention being given to that of the franchisee. Within the single unit context, franchising is said to be successful as it affords satisfactory levels of independence, together with training and support that reduces risk relative to entering an independent business. While research has examined factors affecting the decision to purchase a franchise within the context of the broader decision to become self-employed, there is some evidence that the findings may not be applicable within the Australian franchising sector. This research aims to build theory through the presentation of a set of general propositions explaining the decision to franchise as a function of work and family conflict, the provision of employment for family members and employees, self employment history, and the level of prior experience within the franchise system. Data was drawn exclusively from franchisees in the McDonalds restaurant chain. Overall, the qualitative findings confirmed the validity of the general propositions in preparation for future empirical testing.