Franchise relationships: tacit expectations, great expectations

authors

  • Chanut Odile
  • Paché Gilles

keywords

  • Psychological contract
  • Unwritten agreements
  • France
  • Franchise
  • Method of life history
  • Opportunism

document type

ART

abstract

The franchise relationship is a contractual bond made between a franchisor (the owner of a brand and a distinctive concept) who wants a rapid duplication of stores, and of a franchisee, an independent trader joining a franchise network in order to have access to a successful business system. Franchisees expect franchisors to be loyal and to comply with the previously negotiated contractual provisions. They hope for a franchise relationship free from opportunism. In addition to the existence of a formal contract determining the major obligations negotiated between parties, the parties have tacit expectations of their partners, that they actually consider as obligations. Unwritten agreements are part of a psychological contract which, if not adhered to, may have a negative impact on the franchise relationship when interpreted – sometimes wrongly – as the manifestation of opportunistic behavior. This article is based on an exploratory investigation conducted in France to identify, from personal accounts, the types of betrayal of the psychological contract as perceived by the fran-chisees: betrayals that are often a sign of misunderstanding between franchisors and franchisees.

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