Determinants of Franchise Payments

The topic of the project is franchise relationships in Russia. The relevancy of the problem is determined by the blistering growth of franchising in Russia as a new busness format, which demands investigation. The aim of the paper is to identify which factors determine the amount of franchise payments. To achieve the aim the following tasks need to be accomplished: • give the explanation for the term franchising; • compare international franchising experience with russian; • collect the data about russian franchising companies; • do the econometrical research; • interpret the results. The main ideas of the research are the following: 1) The lower is the royalty rate the higher is the franchising experience of the franchiser; 2) The lower is the royalty, the bigger is the franchise-owned proportion of the outlets within the network; 3) The higher is the royalty, the more days of face-to-face training is provided by franchisor.