International Journal of Science and Management Studies (IJSMS) E-ISSN: 2581-5946 DOI: 10.51386/25815946/ijsms-v5i5p118 Volume: 5 Issue: 5 September to October 2022 https://www.ijsmsjournal.org This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/ ) Page 231 The Franchise Relationship in the Retail Industry in Cebu City David L. Parcasio University of the Visayas Graduate School of Business Management Cebu City, Philippines ABSTRACT This study aims to find out how do entrepreneur perceive on relationship between franchisor and franchisee efficiency of franchisor‟s supports, building up trust to have a better presentation of their business. Furthermore, it is to clarify the relationship between franchisors and franchisees in food cart business in SM Cebu City. In this study, the four perspectives of social, technological, economic, and political were used to study the franchisee‟s performance. Moreover, the resource-based view, relational view, and relational exchange theory have been used to find the influential factors in a franchisee‟s performance. Therefore, by considering franchising as a mutual relationship and examining the influential factors in a franchisee's performance, the related factors of the franchisor and franchisee, as well as the relationship between them, were examined. A primary contribution of this study is taking a bottom-top view in franchising research. This study also provided a detailed and holistic view about the consequences of franchising for franchisees. Moreover, this study, offers important contributions toward understanding entrepreneurial activities, as a controversial issue, in franchising outlets. Most of the respondents agreed that the relationship between them will make their performance better because nature of franchise business is based on cooperation between franchisor and franchisee. All relationship factors also positively affected the performance, and conflict and satisfaction mediated the relationship between trust and performance. Finally, the implications of this study and suggestions for further contributions in this stream of research are discussed. Keywords: Franchising, Franchisor-Franchisee Relationship, Franchisor Supports, Quality of Relationship, Franchisee Trust, Franchisee Performance Introduction Today’s business environment has significantly taken its course of transformation. One of the greatest features of this phenomenon is the varied business format which gives rise to franchising. As a business format, franchising has been incredibly effective in market penetration and has been a highly regarded strategy for business growth, job creation and economic growth. In the Philippine, franchising business is one of the growing industries today and its momentum for growth has never stopped since 30 years ago (Castleberry and Tanner, 2015). One of the salient features of its transformation is that franchising has become a machinery of small business mechanism paving way for small scale business investors and entrepreneurs an opportunity to conduct business which are stable with highly structured marketing strategies. Along this line, the food cart business has become deacon of today’s franchising business and true enough it has become a booming business line and it is developing at such an astonishing rate.. In fact, its growth is comparable with sprouting mushrooms which are established just anywhere and everywhere. Thus, owning a food cart franchise business has become the most popular and effective ways to achieve financial freedom and stability. The food cart franchise business reaches its peak in the Philippines for the last 10 years and according to the Association of Filipino Franchisers, Inc. (2009), there are now about more than 3000 franchises all over the country which made our country known as the “franchise hub of Asia”.