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Vol.7 No.1

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Abstract

Purpose - The purpose of this paper is to find the issues associated with international expansion of Korean franchisors going international and suggest lessons of proposition to reduce the failure risk in international expansion of franchise systems. Research design, data, and methodology - This is the exploratory study and structured to review (1) background to motivate the expansion of franchisors towards international market, (2) the status of Korean franchisors going international in recent years, (3) issues, (4) lessons learned from the experiences, and (5) summary. Secondary sources were reviewed to get necessary data and statistics. Results - Master franchising was the most preferred entry mode for Korean franchisors. Franchisors must understand the expenses to be incurred as well as revenues associated with international activities. Brand is the core asset of franchisor as a differentiation strategy. Conclusions - The paper indicates that even if international franchising is the unique business model for franchisors to use in little or least risk compared with other international entry modes, it needs a set of complex capabilities that much differ from those in domestic and franchisors should take a step approach to the international market with the planned and long term perspective.

Koo, Dong-Woo ; Lee, Sae-Mi ; Jang, Hae-Jin pp.13-20 https://doi.org/https://doi.org/10.21871/kjfm.2016.06.7.1.13.
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Abstract

Purpose - In the past, the chain hotel chefs only serve food to their customers. However recently, the hotel chefs play a pivotal role in hotel including considering various customer preferences, safety and nutrition of food, and increasing profits through effective human resource management and inventory control. With the change of the chain hotel chef's' roles, pygmalion leadership, one of new leadership styles, focuses on the effect that leader's positive expectation let subordinates have motivation and more engage in work. This study investigates the effect of chain hotel chef's pygmalion leadership on leader trust and organizational trust. Research design, data, and methodology - This study was to investigate the structural relationships among chain hotel restaurant chefs' pygmalion leadership, hotel restaurant cooks' leader trust, organizational trust, and teamwork, and how leader trust and organizational trust play mediating roles in the relationship between pygmalion leadership and teamwork. In this model, pygmalion leadership includes 4 dimensions: Climate, Feedback, Input, and Output. Data were collected using self-administered questionnaire survey on cooks of Deluxe hotel restaurants located in Seoul and Gyonggi-Do. The samples for data analyses were 243 excepting unusable responses. Result - The findings can be summarized as follows: First, climate and feedback had a positive effect on leader trust, respectively. Second, feedback and output had a statistically positive effect on organizational trust, respectively. Third, leader trust had positive effects on organizational trust and teamwork. Fourth, organizational trust had a significant effect on teamwork. Conclusions - As a chain hotel chef treats his/her staffs sincerely, they will be more engaged in work by establishing trust in their leader. Ultimately, it leads to higher sales profit and customer satisfaction. In addition, a hotel can encourage chefs and other staffs to treat each other as if the student-instructor relations, not just commanding staffs. Then, cooks build up their trust to their leader and organization for its sustained growth and development, and the internal bond in organization including teamwork is strengthened. Therefore, to strengthen teamwork and organizational trust, there should be active communication, knowledge sharing, goal sharing, and cooperation between chefs and cooks.

Lee, Yong-Sook ; Kim, Eun-Jung ; Park, Heung-Jin pp.21-29 https://doi.org/https://doi.org/10.21871/kjfm.2016.06.7.1.21.
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Abstract

Purpose - The primary purpose of this study is to employ effective marketing methods using market segmentation of coffee shops by determining how motivations to visit coffee shops have different impacts on demographic profile of visitors and characteristics of coffee shop visits, so as to draw out a better understanding of customers of coffee market. Research design, data, and methodology - Data were collected using surveys of self-administered questionnaires toward coffee shop users in Daejeon, Korea. A number of samples used in data analysis were 253 excluding unusable responses. The data were analyzed through frequency, reliability, and factor analysis using SPSS 20.0. Factor analysis was conducted through the principal component analysis and varimax rotation method to derive factors of one or more eigen values. In addition, the cluster analysis, multivariate ANOVA, and cross-tab analysis were used for the market segmentation based on the types of motivation for coffee shop visits. The process of the cluster analysis is as follows. Four clusters were derived through hierarchical clustering, and k-means cluster analysis was then carried out using mean value of the four clusters as the initial seed value. Result - The factor analysis delineated four dimensions of motivation to visit coffee shops: ostentation motivation, hedonic motivation, esthetic motivation, utility motivation. The cluster analysis yielded four clusters: utility and esthetic seekers, hedonic seekers, utility seekers, ostentation seekers. In order to further specify the profile of four clusters, each cluster was cross tabulated with socio-demographics and characteristics of coffee shop visits. Four clusters are significantly different from each other by four types of motivations for coffee shop visits. Conclusions - This study has empirically examined the difference in demographic profile of visitors and characteristics of coffee shop visits by motivation to visit coffee shops. There are significant differences according to age, education background, marital status, occupation and monthly income. In addition, coffee shops use pattern characterization in frequency of visits to coffee shops, relationships with companion, purpose of visit, information sources, brand type, average expense per visit, important elements of selection attribute were significantly different depending on motivations for coffee shop visits.

Han, In-Su ; Lee, Phil-Soo ; Park, Heung-Jin pp.31-44 https://doi.org/https://doi.org/10.21871/kjfm.2016.06.7.1.31.
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Abstract

Purpose - This study aims to examine different impacts of franchisor's leadership and franchisee's marketing efforts on franchisee dissatisfaction and switching intentions, and to investigate how franchisee dissatisfaction plays a mediating role in the relationship between these constructs. This study attempted to fill the gap in the literature by treating the franchisee dissatisfaction as a mediator in the relationship between these constructs, identify how franchisor's leadership and franchisee's marketing efforts have effects on franchisee dissatisfaction, in turn, reduce switching intentions, and provide the managerial implications for building a long-term relationship to achieve mutual goals between franchisors and franchisees Research design, data, and methodology - In order to test the hypotheses, the data were collected from franchisees in Seoul and Gyeonggi Province. The franchisee owners were informed about the purpose of this study by the trained interviewers. The respondents received a letter introducing the purpose of this study and another letter that the owners wrote to encourage their active participation. Among the 300 questionnaires distributed, 260 (86.7%) questionnaires were returned. Of those collected questionnaires, 6 uncompleted responses were excluded, and 254 questionnaires with an effective response rate of 84.7% were coded and analyzed using frequency, confirmatory factor analysis, and correlations analysis, and structural equation modeling with SPSS 21.0 and SmartPLS 3.0. Results - The findings of the study are as follows. First, franchisor leadership had a negative effect on franchisee dissatisfaction, but franchisee marketing efforts did not have a significant effect on franchisee dissatisfaction. Second, franchisee dissatisfaction had a positive effect on switching intentions. Third, franchisor leadership had a negative effect on switching intentions, but franchisee marketing efforts did not have a significant effect on switching intentions. Conclusions - This study researched the franchisor's leadership as a single factor of transformational leadership. Thus, it may have limits in measuring leadership. Future studies shall include emotional, loyal, and transactional leadership. In addition, the future studies shall also research the effect of franchisor's leadership and franchisees' marketing efforts on dissatisfaction and switching intentions. For example, the franchisor's relationship-oriented efforts can be a crucial parameter that reduces dissatisfaction and switching intentions.

The Korean Journal of Franchise Management