Critical success factors for a restaurant franchise system entering the kenyan market

Abstract

In today’s globalized world, businesses look to expand in order to have a global presence. Restaurant businesses have expanded internationally using franchising. This study sought to determine the critical success factors for a franchised restaurant system entering the Kenyan market. It sought to ‘establish how franchisors and franchisees define, identify and evaluate success’. It also sought ‘to determine what makes a franchise successful from the customers’ perspective. This study has provided a theoretical framework that helps to understand the background of why organizations seek to expand using franchising method and consequently the critical success factors for franchised restaurants entering the Kenyan market. The study used qualitative methodology in establishing the views of franchisors and franchisees with the use of in-depth interviews. In keeping with research trends this study also used triangulation of methodology. We did an exploratory study using focus group discussions to explore the views of customers on franchised restaurants. Thereafter we carried out a survey to verify the hypotheses developed for the study in this way using triangulation of methodology and arriving at a better understanding of the issues under study. This was followed by analysis of the qualitative data and the quantitative data separately.The results yielded critical success factors from the franchisors perspective, franchisees perspective and the customers’ perspective. The critical success factors from the franchisors point of view included a clear concept, distance management, cultural appeal, excellent selection of franchisees, good site/location selection, and good relationship with the franchisees and reasonable franchise contractual terms. The critical success factors from the franchisees point of view were good relationship with the franchisor, good financial management, relationship marketing, good staff management, competent staff, and unique value proposition for the customer, attractive atmosphere, convenient location and speed of service. The customers’ perspective included good and consistent products and product range (menu mix), competent staff who were clean, warm, courteous and welcoming, a pleasant and clean atmosphere, reasonable and stable prices and a convenient location with efficient service. Finally the study proposed a prioritization of critical success factors from the customers’ perspective. These findings can be used by restaurant franchises that seek to establish successful businesses in the Kenyan market and other similar regional markets. The Africa franchise partners may also find useful information in setting up the Franchise Association of Kenya. Other franchise businesses may also benefit from some aspects of the study.