Original Research

Modelling effect of valuable resources on franchise outlet performance: Dynamic sensing capability as mediator

Jilson Zimuto, Rachel Maritz
South African Journal of Economic and Management Sciences | Vol 22, No 1 | a2706 | DOI: https://doi.org/10.4102/sajems.v22i1.2706 | © 2019 Jilson Zimuto, Rachel Maritz | This work is licensed under CC Attribution 4.0
Submitted: 23 July 2018 | Published: 09 July 2019

About the author(s)

Jilson Zimuto, Department of Business Management, University of Pretoria, Pretoria, South Africa
Rachel Maritz, Department of Business Management, University of Pretoria, Pretoria, South Africa


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Abstract

Background: Competitive advantage and superior firm performance depend on resources and dynamic capabilities.

Aim: This study aims to provide insight into the franchising industry where research on the value-dynamic sensing capability-performance relationship as part of the resource-based theory (RBT) seems to be novel. Drawing on the RBT, this study examines how valuable resources and dynamic sensing capability impact franchise outlet performance.

Setting: Based on a cross-sectional design, a sample of 224 South African franchise outlet managers and owner-operators in the fast food and retailing categories was surveyed.

Methods: Hypotheses were tested using a single-level structural equation model for value, dynamic sensing capability and performance.

Results: The results contribute to research on RBT in the context of franchises by providing support for the assumption that firm resources and capabilities improve performance.

Conclusion: The findings are expected to provide a strong base from which franchise managers and owner-operators can strategise for competitive advantage in an emerging economy like South Africa.


Keywords

Resource-based theory; resource-based view; strategy; dynamic sensing capability; performance; franchises.

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