Strategic and Contextual Influences on Firm Growth: An Empirical Study of Franchisors

Abstract

This study examined five-year growth patterns among a sample of 246 franchise networks in order to identify factors associated with network growth. Two strategic factors and two contextual factors were significantly related to growth. Among those four significant factors, however, two of the relationships were in directions opposite of those hypothesized. The most likely explanations of these findings, taken together, suggest that both strategy and context exert influences on growth, though strategic influences may be greater than contextual ones.