Impact of Artificial Intelligence on Franchise Industry: Evidence from Saudi Arabia

Abstract: This study investigates the influence of artificial Intelligence (AI) on the franchise industry in Saudi Arabia. As AI technologies continue to transform business operations globally, it is essential to understand the specific impact within the Saudi franchise sector. Despite the growing adoption of AI in businesses, there is limited research on how AI affects data analysis, decision-making, customer service, and brand awareness within Saudi Arabian franchises, focusing on food and beverage, and automotive service sectors. This study uses a quantitative approach, collecting data from franchises to analyze the relationship between AI applications and franchise performance outcomes. The results reveal that AI implementation within franchise operations is essential in improving operational efficiency, decision quality, customer satisfaction, and brand awareness. Key essential factors include process automation, data accuracy, and customer interaction quality. This research helps in creating scientific understanding of the AI’s role in Saudi Arabia franchise industry, thus closing knowledge gap between technological innovation and industry-specific applications. The findings provide a clear basis for future research studies on AI adoption across different franchise sectors. Therefore, informing the development of AI integration frameworks for franchise businesses within developing digitalized economies. Keywords: Artificial Intelligence, Franchise Industry, Food & Beverage, Automotive Service, Technology, Innovation, Saudi Arabia JEL Classification Number: M30 and M31