A study of the impact of environmental uncertainty on franchise systems: the case of petrol retailing in the UK

Research has confirmed that franchise systems may change over their lifetime. It is argued that changes to franchise systems may be the result of changes in the level of uncertainty they face in their environments. It therefore examines the developments that have occurred both in the state of the environment and the nature of the franchise systems of one group of traditional franchisors in Britain – namely, the oil companies’ petrol retailing networks – over the past 20 years in order to assess the validity of this view and to shed some light on the long‐term developments of traditional franchises. In particular it considers whether increasing environmental uncertainty encourages traditional franchisors to adopt the characteristics of business format franchise agreements in order to tighten their control over their franchisees.