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Tchibo Goes Global: Implementing a Hybrid Franchising Strategy at Germany's Leading Coffee Retailer
Author(s) -
Alon Ilan,
Lattemann Christoph
Publication year - 2015
Publication title -
global business and organizational excellence
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.227
H-Index - 16
eISSN - 1932-2062
pISSN - 1932-2054
DOI - 10.1002/joe.21652
Subject(s) - commission , business , internationalization , investment (military) , industrial organization , salary , marketing , market economy , finance , economics , international trade , politics , political science , law
Hailed as one of the most successful business models for expansion in the Western world, franchising enables the owner of a brand (the franchiser) to overcome scarce resources and the problems of delegated responsibility by making the franchisee a residual claimant on profits. Tchibo, Germany's leading coffee retailer, has created a hybrid commission‐agent model of franchising, whereby the franchisee contributes a small investment but does not pay any start‐up costs and receives a minimum salary plus a commission on sales. A look at the history and development of Tchibo's hybrid franchising model and its internationalization strategies suggests lessons for other organizations seeking to expand their operations into rural and global markets. © 2015 Wiley Periodicals, Inc.