E-Commerce and Encroachment: Evidence From French Franchise Networks

Encroachment is a critical issue affecting relations among franchisees and between franchisees and franchisors. The Internet increases this risk when a franchisor adopts a transactional website, becoming a “ubiquitous outlet.” Using logistic regression we give evidence of the significant impact of the proportion of franchised outlets in the network on transactional website adoption by French franchisors. The analysis is carried out to facilitate comparison with the United States market. A web-to-store strategy and the click-and-collect system implemented by most French supermarket chains are presented as potential solutions to circumventing e-encroachment.