Critical Success Factors: A study of Swedish Restaurant Franchisors

ABSTRACT Aim: From its inception to its expansion nationally and internationally, the management of a restaurant franchise concept uses various critical success factors to overcome the barriers that they encounter throughout their different growth phases. This study aims to find out what the CSFs are for Swedish restaurant franchisors of different sizes, what barriers they encounter and what their solutions to these problems are. Method: This is a qualitative study. An initial study was performed by open-ended interviews with the CEOs of the Swedish Franchisor organization and the CEO of the Swedish Franchisee organization. Thereafter, ten semi-structured telephone interviews were held with the upper management at Swedish restaurant franchisor companies. Saturation was achieved after 6-8 interviews and the data was analyzed thematically. Results & Conclusions: Small franchisors focus on concept development, finding capital and finding franchisees. Two of the smaller franchisors used crowdfunding to finance their expansion. Larger franchisors focus on standardization, improving their quality and on brand building. The conclusion is that there are significant differences in the CSFs for small and large franchisors. Suggestions for future research: This study is limited in scope and limited in time. For future research, we would recommend a longitudinal study of several newborn franchise systems, to study them over several years and to see which CSFs are more important at different growth stages. Another research approach could be to rank the CSFs by using a quantitative method and work with a larger sample frame of franchisors. Or to study our fastest growing respondent. Contribution of the thesis: The main contribution to literature is that small franchisors focus on selecting the right franchisees and locations, large franchisors focus on developing the concept and on standardization. The main managerial implication is that franchisors of all sizes need to take a broad perspective and plan for different expansion phases. Keywords: Franchising, Franchisee, Franchisor, Critical Success Factors, CSFs, Restaurant Chain, Fast-Food chain, life cycle, expansion, barriers.This is a study of what the most important tasks are to successfully expand ten franchised restaurant chains in Sweden. These tasks have been studied in various industries and are commonly referred to as "Critical Success Factors." It is interesting to study these tasks since the upper management in any company and industry need to be aware of what the most important tasks are for their company, as well as the need of measuring these tasks. The result of the study was that restaurant franchisors seem to have different CSFs depending on their size. Small franchisors focus more on, e.g., concept development, whereas large franchisors focus more on, e.g., standardization. The managerial implication is that managers in expanding franchise systems need to be aware that the CSFs change over time