Abstract
As the quick-service-restaurant market matured, the relationship between franchise firms and their franchisees stabilized, allowing power and control issues to surface. The balance of power in the relationship, as perceived by the franchisees, affects both the franchisees' satisfaction with the arrangement and their financial results. When franchisors have great economic power, franchisees may become dissatisfied and have lower revenues relative to their potential. On the other hand, when the franchisees perceive that their franchisor's power is noneconomic, the franchisees are more satisfied and able to achieve stronger margins.
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