Foreign and Domestic Franchise Chains in an Emerging Market: A Comparative Analysis

A logistic regression with 147 chains of Brazilian franchises and 41 chains of foreign franchises operating in Brazil showed that foreign and domestic franchise chains differ in three stages of the establishment process: installation, maintenance and expansion. In addition, three semi-structured interviews were conducted with three franchisors from foreign chains. The results show that foreign franchises have a higher rate of investment and maintenance than Brazilian franchises, however, they exhibit a lower capacity for monitoring and control than Brazilian franchise chains.

On the other hand, contrary to expectations, foreign franchise chains active in Brazil have a lower growth rate than domestic franchise chains.