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.
