Development of Franchising in Terms of Digitalization

Abstract

The emergence of new business models in franchising, driven by digitalization, is undeniably reshaping our conventional understanding of business processes. While new technologies are intended to simplify and optimize operations, it's crucial to consider the potential challenges that both franchisors and franchisees may encounter. This article examines the concept of digitalization within the context of franchising's evolution, highlighting both the positive impacts of this process – such as digital tools that can enhance communication and collaboration between franchisors and franchisees, the utilization of smart contracts, website creation, and enhanced analytics through big data – as well as the challenges that arise from the adoption of new technologies. These challenges include: the legal and regulatory frameworks required for new franchising models, the readiness of companies to implement new digital tools, the need for new infrastructure and skilled personnel, the impact of new technologies on companies' competitiveness, and the potential limitations on franchise growth in the digital economy. CZU: 005.591.43:004.78; JEL: O33; M21; F10