Social franchising: A transitional solution for organisational growth of social entrepreneurial organisations?

The aim of our study is to investigate factors influencing organisational growth of social entrepreneurial organisations in the context of social franchising. In particular, we examine whether and how the amount of a franchise fee and the degree of standardisation can enhance or hinder organisational growth. We use an exploratory qualitative research approach to take account of the entire context of social franchise relations. Our analysis is based on semi-structured interviews with social franchisors and social franchisees as well as an analysis of written social franchise agreements. We develop a theoretical framework showing two nonlinear relations: Between the amount of the franchise fee and organisational growth and between the degree of standardisation and organisational growth. Overall, our results suggest that social franchising is only a transitional solution for social entrepreneurs in generating organisational growth.