FEMALE FRANCHISORS: HOW DIFFERENT ARE THEY FROM FEMALE INDEPENDENT BUSINESS OWNERS?

EXECUTIVE SUMMARY In recognition of the growing importance of small business ownership by women to the economic well-being of national economies, considerable academic attention has been given to identifying the reasons why women enter self-employment. However, little is known about the motivations for women to become franchisors. This represents an important gap in the literature. While the absence of research may be due to early beliefs that women are risk averse individuals that tend to limit the growth of their enterprises, more recent studies conclude that women perceive small business ownership as a vehicle for rapid growth and wealth creation. On this basis, franchising should represent an appealing business expansion strategy as it minimizes capital, labor, and managerial limitations on firm growth. However Australian female participation rates in franchising are substantially lower than in small business generally. The purpose of this research is to provide a clearer understanding of the motivational incentives driving the choice of franchising as a business development strategy from the female entrepreneur's perspective. It was felt important to use a qualitative, case study approach, to get a clearer picture of the main issues and parameters. Twenty-four female franchisors were interviewed to gather data on the salient factors influencing their initial decision to adopt franchising. In addition, 20 female entrepreneurs were interviewed. Significant differences were found between the influence of antecedent factors and motivational incentives of women entering franchising and small business, suggesting that changes in public policy initiatives are required to encourage greater acceptance of women as franchisors, build awareness of franchising as a small business alternative for women, and provide accessible information and training for women on how to become franchisors. Keywords: Female franchisors, motivational incentives, social capital, human capital, coprenuerial ********** Female-owned businesses are becoming increasingly important to employment in many western economies (Moore, 2002; Riebe, 2005; Walker, 2004). Currently, more than 33 percent of small businesses in Australia are owned and operated by women, with the growth in female-owned small businesses currently exceeding the rates of growth in male owned enterprises (Australian Bureau of Statistics, 2002, 2003). Early research examining organizational choice behaviors identifies female entrepreneurs as typically risk averse individuals operating micro businesses predominantly within traditional retail and services sectors (Sheridan and Conway, 2003; Still and Timms, 1999). Generally, social motives are deemed more important than desired financial outcomes, leading some researchers to suggest that female small business owners are 'satisficers' who limit growth in their enterprises in an attempt to maintain control over the future (social) direction of their enterprises (Brush and Hisrich, 1991; Still et al., 1990). However, the growth of female-owned enterprises may be limited by external constraints as many women face significant difficulty in obtaining equity investment, appropriate training, and ongoing managerial advice (Boden and Nucci, 2000; Still and Guerin, 1991). Given that franchising offers an efficient method of business expansion through providing expedient access to capital, market knowledge, and managerial talent (Combs and Castrogiovanni, 1994; Kirby and Watson, 1999; Oxenfeldt and Kelly, 19681969), it is curious that greater numbers of female franchisors are not evident within the Australian franchising sector. More recent research suggests that female entrepreneurs are not a homogenous group with some entering small business to realize goals of wealth creation and rapid business growth (Carter and Anderson, 2001; Still and Soutar, 2001). In particular, these entrepreneurs are more likely 'pulled' into self employment with the view to grow and replicate their business concepts (Korn/Ferry, 2001). …