Strategic Integration of E-commerce and Franchising
Strategic Integration of E-commerce and Franchising

Author(s): Angelo Manaresi
Subject(s): Social Sciences
Published by: Udruženje ekonomista i menadžera Balkana
Keywords: E-commerce; Franchising; Strategy
Summary/Abstract: The primary objective of this article is to discern the strategy implications arising from the incorporation of e-commerce by franchisors within franchise networks. Following interviews with key informants, an experi¬ment was conducted to investigate the franchisees’ willingness to continue investing in the franchise network after the franchisor introduces an e-commerce platform that excludes them. The long-term repercussions of integrating e-commerce into franchising networks include a diminished willingness among franchisees to sustain their investments. This may differ from the short-term acceptance of the franchisor’s e-commerce initiative, primarily attributable to the substantial power imbalance between franchisor and franchisee, as well as short-term inertia inherent in relation-specific investments and franchise contracts. A significant challenge faced by franchisors is the choice between establishing a profit-sharing model or, ideally, a mutually beneficial win-win arrangement with franchisees. Alternatively, the strategy may consider allocating more resources to directly operated stores.

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