Foreign ownership strategies of UK and US international franchisors: An exploratory application of Dunning's envelope paradigm

John H. Dunning, Yong Suhk Pak, Sam Beldona

Research output: Contribution to journalArticle

33 Citations (Scopus)

Abstract

In industries dominated by franchising as the dominant mode of entry there is a tendency that franchisors pursue different ownership strategies. We test ownership strategies of international franchisors using Dunning's 'envelope' Ownership, Location and Internalization (OLI) paradigm. The ownership choices of international franchisors' foreign market entry based on the strategic intent of exploitation and exploration are well explained by Dunning's 'envelope' OLI paradigm. Our results show that the dynamic L advantages (perceiving foreign locations as a source of learning), the static O advantages (nationality of the firm) and static L advantages (the role of foreign applicants) have a significant influence on the selection of foreign entry strategy by international franchisors.

Original languageEnglish
Pages (from-to)531-548
Number of pages18
JournalInternational Business Review
Volume16
Issue number5
DOIs
Publication statusPublished - 2007 Oct 1

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Finance
  • Marketing

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