A Western franchise in Shanghai, China: a late entrant’s success

Abstract

This research examines the timing of a food retail franchise’s entry into Shanghai, China. Previous literature espouses the benefits of early movers, but there is a lack of focus on related contingencies that influence the effect of entry timing on franchising outcomes. We employ a qualitative case study in two phases. The first interviews key franchise personnel regarding their motivations and strategies for expanding. The second utilizes focus groups to gain an understanding of customers’ perspectives. This paper considers the implications of the timing of market entry for franchises. Applying resource-based view, dynamic capabilities, and agency theory and institutional theory, the study provides an understanding on how entry timing should be analysed in conjunction with other contingencies including the area that is entered, the type of entry, the relevant players and the strategies, resources, capabilities, and assets needed to enter in order to achieve desirable outcomes.