Balancing International Expansion and Control in Global Franchise Networks: A Conceptual Framework Using Subway as an Illustrative Case.
Author
Majumder, Geetasree
Term
4. Term
Publication year
2026
Submitted on
2026-06-01
Pages
72
Abstract
This thesis examines how franchisors balance the push for rapid international growth with the need to maintain control and brand consistency across diverse franchise markets. Franchising enables multinational firms to expand with lower capital commitments by leveraging franchisees’ local knowledge, but it introduces governance challenges in protecting brand reputation, ensuring strategic alignment, and maintaining operational consistency. The study develops a conceptual framework that links brand strength, governance mechanisms, and the expansion–control trade-off, drawing on Transaction Cost Theory, the Resource-Based View, and the OLI paradigm. The research is conceptual and qualitative, based on secondary academic literature and publicly available company information, and uses Subway as an illustrative case of a highly standardized global franchise system. The analysis highlights the complementary roles of formal governance mechanisms (contracts, monitoring, operational audits, standardized procedures) in curbing opportunism and inconsistency, and informal mechanisms (collaborative relationships, training, communication, and ongoing support) in fostering coordination between franchisors and franchisees. It underscores an inherent trade-off: rapid network growth broadens market reach but increases communication burdens and the complexity of governance and monitoring. The proposed framework contributes to international franchising research and offers practical guidance on combining formal and informal controls to sustain brand consistency while pursuing international expansion.
Dette speciale undersøger, hvordan franchisegivere balancerer ønsket om hurtig international vækst med behovet for kontrol og brandkonsistens på tværs af forskellige franchisemarkeder. Franchising gør det muligt for multinationale virksomheder at ekspandere med lavere kapitalbinding ved at drage nytte af franchisetagernes lokale viden, men skaber samtidig styringsmæssige udfordringer i forhold til at beskytte brandets omdømme, sikre strategisk alignment og opretholde operationel ensartethed. Specialet udvikler en konceptuel ramme, der forbinder brandstyrke, styringsmekanismer og afvejningen mellem ekspansion og kontrol, med udgangspunkt i transaktionsomkostningsteori, resource-based view og OLI-paradigmet. Undersøgelsen er konceptuel og kvalitativ, baseret på sekundær akademisk litteratur og offentligt tilgængelig virksomhedsinformation, og anvender Subway som en illustrativ case for et højt standardiseret globalt franchisesystem. Analysen fremhæver de komplementære roller for formelle styringsmekanismer (kontrakter, monitorering, driftsaudits, standardiserede procedurer) til at reducere opportunisme og inkonsistens, samt uformelle mekanismer (samarbejdsrelationer, træning, kommunikation og løbende support) til at styrke koordineringen mellem franchisegiver og franchisetager. Studiet understreger en iboende afvejning: hurtig netværksvækst udvider markedsrækkevidden, men øger også kommunikationsbyrden og kompleksiteten i styring og overvågning. Den foreslåede ramme bidrager til forskningen i international franchising og giver praktiske indsigter i, hvordan formelle og uformelle kontrolformer kan kombineres for at fastholde brandkonsistens samtidig med international ekspansion.
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