International Journal of Accounting Research

Abstract

Control or Let Loose: The Franchising Business in Davao City

Joel B Tan, Sayson Antonio Jr. H, Laurel John Patrick P, Bacus Elpidio Jr and Sevilla Edelyn R

Franchise business contributes 10% of the world’s gross domestic product (GDP) and 14% of the world’s retail sales, thus, making it an influential form of retailing for the past years. Its growth is attributed to an increasing rate of satisfied franchisees. This study will investigate the level of control mechanisms of the franchisor and the level of satisfaction of the franchisee in Davao City. The paper used a descriptive survey method. Results of the study revealed a direct relationship between the overall level of franchisee satisfaction and the level of control mechanisms. It showed that the level of outcome control, behavior control and social control are very satisfied. The level of satisfaction of franchisee with regards to control mechanisms of their franchisors is also very satisfied. If the franchisor increases its control mechanisms to their franchisee, the franchisees satisfaction also increases. This study does not answer issues regarding an employee-manager satisfaction (employed by the franchisee to manage the endeavor). This study gives new knowledge to franchisee whether controlling or letting loose their franchisee would benefit the franchise endeavor.