Pricing practices and organizational fairness on the long-term orientation of franchisees

Purpose This study analyses the effects of direct pricing and cooperation in pricing, as well as organizational fairness, on the long-term orientation of franchisees. Design/methodology/approach Data were collected through a questionnaire administered to 105 franchisees in Brazil and analysed using structural equation modelling (PLS/SEM). Findings Direct pricing and cooperation in pricing influence the perception of organizational fairness, which plays a significant role in shaping long-term orientation. The study also highlighted the role of organizational fairness across distributive, procedural, informational, and interpersonal dimensions in linking direct pricing and cooperation in pricing to the franchisees' long-term orientation. Originality/value This study advances knowledge of pricing practices in franchisor-franchisee relationships, providing insights into best practices that foster long-term relationships. It also extends the literature on organizational fairness by examining its role in a legal and cultural environment distinct from that of previous studies. The findings provide empirical evidence that perceptions of organizational fairness are crucial to maintaining long-term franchisor-franchisee relationships.