Abstract

Purpose - In franchise system, how to build the relationship between the franchisor and franchisee through influence strategy is very important, because it affects on the long-term orientation like recontract intentions. Thus, this study examines the effect of mandatory influence strategy on relationship satisfaction, relationship trust, and recontract intentions in the context of food-service franchise industry. This study suggests the guidelines on how franchisor uses their influence strategy on franchisee to maintain and increase the recontract intentions. Research design, data, and methodology - This study examines the structural relationship between mandatory influence strategy, relationship satisfaction, relationship trust, and recontract intentions from the franchisee's perspective. Mandatory influence strategy divide into three sub-dimensions such as request, legalistic plea, threat. In order to test the purposes of this study, research model and hypotheses were developed. Every constructs were measured by multiple items tested and developed in the previous research. Also, the constructs utilized in this research are measured using 7-point scales anchored by "1=strongly disagree" and 7=strongly agree". The data were collected from 496 owner and owner manager franchisees and were analyzed using SPSS 21.0 and Smart PLS 3.0. program. Analysis of frequency was conducted to identify the demographics and general characteristics of the survey subjects. In order to measure the reliability and validity of the measurement tools, confirmatory factor analysis and correlation analysis were conducted and structural model analysis was conducted to verify the proposed research model. Result - The results of this study are as follows. First, this research found that mandatory influence strategy is positively related to relationship satisfaction and relationship trust, but not to recontract intention directly. Second, this research also found that the full mediating role of relationship satisfaction and relationship trust between the mandatory influence strategy and recontract intention. Conclusions - The findings of this research indicate that franchisor should use properly mandatory influence strategy to improve recontract intentions through relationship satisfaction and relationship trust. Due to the nature of food-service franchise industry, which needs high relationship quality, franchisor must manage their franchisee using influence strategy in order to improve satisfaction and trust. If franchisee perceives higher relationship quality, they will show higher intention to recontract. At the end of this paper, limitations and future research directions were suggested.