Food Industry Malaysia 8265x

1.0 INTRODUCTIOON 1.1 Background：Food Truck industry and Flaming Wheels The first food truck in the world was invented by "father of the Texas Panhandle" named Charles Goodnight in 1866. Due to the "Westward Movement", there are large market of beef in west of continental, more and more herdsman herd cattle to there. During the cattle drives, it is very difficult for cook delicious meals, in the early, the food truck was created just service for herdsman can easy to cook proper meals. With the age of time, in the 1890s the food truck main service for night time workers. Developing to today, the food truck already grown as more extensive service scope, we can see the food truck anywhere and anytime. The food truck is the combination of delicious and fashion, it also growing in popularity all over the world. In Malaysia, the first and most famous food truck named Flaming Wheels. It is unique food truck in Malaysia, Flaming Wheels have proudly launched the mobile food truck on 17th October 2013, and it has an intention to create kitchen-on-Wheels that sells freshly-cooked food around the Klang Valley. The owner Dina Blazevic of Amadeus bistro at Life Centre in Kuala Lumpur started mobile food truck as she was exited about American idea when she saw it on television. She understood that she found new trend of serving food in Malaysia. 1.2 Research Objective 1) Identify the franchising procedures 2) Identify success factor of the franchisor 3) Identify the environment of franchising business in Malaysia. 1.3 Limitations of Study Although useful findings had been carried out through this study, there are several limitations needed to be acknowledged. Firstly, the finding cannot be generalized extensively. It is known that the sample of research is represented by INTI students. This means that this research just focused on INTI students rather than outsiders. The student attitude and behavioral intention may similar to each others. Although the questionnaires are separate among the students but most of the student are our friends which have quite similar interest.

Secondly, this study is limited as it is only based on the small size of (100) respondents. This makes the accuracy of this research reduce or decrease. Although, this is due to the constraint of the time and resource, but the more respondents that have, the research will be more precise. Thirdly, the questionnaire of the study is quite hard to fill in. The respondents may do not know how to express or measure based on their feeling. It is because there are 5point, which 1 stands for strongly agree towards 5 strongly disagree. Most of the respondents are unable to measure correctly their level of feeling. Last but not the least, there are some respondents who feel hard to understand the meaning of certain questions asked. So, it is also hard for them to answer according to their feeling. Some of the question is even confusing the respondents. Therefore, it might also create inaccuracy in the data collected. 1.4 Organization of the Report There are five chapters in this research proposal. Chapter one discuss about the introduction of the study, research objectives, limitation of study and research questions. Literatures review will be develop in chapter two. Chapter three presents the research methodology that used in this research while the analysis of result and hypotheses testing will be discussed in chapter four. Finally, chapter five and six will summarizes the study which include implication, future research and conclusion.

2.0 LITERATURE REVIEW 2.1 Franchising in Malaysia The Government of Malaysia (GOM) has determined franchising as catalyst in order to grow the entrepreneurs in Malaysia so GOM has taken a series of policies for ing franchising positively. During the 9th Malaysia Economic Plan (9MP) from 2005 to 2010, GOM has funded nearly US $ 5.7 million for franchise development in Malaysia. The fund can 1000 franchisees and 50 franchisors, 46 franchisors has benefited from 9MP until November 2009 (US Commercial Service, 2009).

Malaysian franchise industry has steadily increased by 10% to 15% annually in the last four years in spite of the influence of economic crisis since 2008. In 2012, the franchise industry took 2.5% of total GDP and reached RM 24.3 billion. It is expected that franchise industry will target 9.4% of total GDP by 2020. Minister Datuk Seri Ismail Yaakob highlighted that new franchise registration grew to 651 in 2013 from 366 in 2008, 69% of them from the local franchise firms, the rest of them from the foreign franchises (Malaysia Business, 2014). The food and beverage sector took up 34% and ranked first, followed by the accessory and apparel sector with 12% of market share, education11%, service 11% and health and beauty at 10% in 2012 (Malaysia Business, 2014).

Progressively, casual dining and full service restaurants are becoming hot. US casual dining food and service concepts lied in shopping mall are running business well in contrast with the standalone stores in Malaysia. Surprisingly, fast food /delivery segments are also running business well lied in the shopping mall and standalone stores. People in Malaysia trend to adventure in cooking so as to make sure food and beverage sector have a broad market. Malaysia expects to be a developed country by 2020. It must increase its income and national capital base in order to fulfill its blueprint by 2020. Food and beverage sector looks forward to grow in the next 6 years (US Commercial Service, 2013). Malaysia government recognized the value of franchising, thus, it has taken the credit scheme and tax incentives to further develop franchise industry. The blueprint of

franchising development is to establish Malaysia as franchising hub in South East Asia, transform business by franchising, improve competitive advantage of franchises and construct a dynamic franchise system by 2020 (Malaysia Business, 2014). In 2013, there was 6000 franchisees and 603 franchise brand throughout Malaysia (Malaysia Business, 2014). 2.2 Franchising procedures The first stage called pre-opening which categorized into 6 steps. Firstly, intended franchisees must present application including complete document. Secondly, the franchisor team will assess the qualification of franchisee. If market demand is saturated in some areas, the application will be rejected. Moreover, the franchisors have to assess the franchisees’ background. If ing the assessment, franchisors will continue to the third step. The franchisors will interview with the franchisees. Fourthly, the franchisor and franchisee discuss the and conditions. The franchisor ensures that the franchisee truly understands and conditions and abides by the rules. If franchisee favors, they go on step 5 referring to g agreement. The franchisee must pay the initial payment and setup fee. Lastly, the franchisor and franchisee go on on-site visit. Stage 2 called opening. The first step is franchise direction. The qualified franchisee learns the franchise business operation methods and procedures from the franchisor and know relevant responsibilities. Step 2 is to discuss how to renovate the outlet and recruit new employees. Step 3 is to begin to renovate the new outlet and relevant training offered by franchisor. Step 4 is to fix the equipments in the outlet after training and renovation is finished. Lastly, they market the outlet through newspapers and hold opening ceremony. 2.3 Law of Franchising In Malaysia, all franchisees and franchisors must abide by Law of Franchising, otherwise considered as offence. Relevant law of Franchising as follow: 2.3.1 Registration A franchisor must his franchise with the registrar before he sells his franchise to anyone. A person doesn’t abide by the section considered as an offence unless he is immune from section 58 by the minister.

2.3.2 Application of Registration, extension, termination (a). A franchisor must apply registration for his or her franchise by submitting to the Registrar the application with the prescribed form together with: complete documents with necessary particulars filled in; franchise agreement, franchise operational handbook, training handbook, a copy of financial report and audited report. (b) . After receiving an application and before determined, the Registrar might require the applicant to offer else documents. (c). Requirements under subsection might be different between different applicants. (d). Application can be withdrawn before it is determined or refused. (d) Submitting false documents under the section considered as an offence. (e). A franchise term might be terminated before the expiration in following circumstances: both parties back termination; in the agreement the merit terminated earlier than the minimum term. (f). before the expiration of franchise term, a franchisee should inform the franchisor for extension of franchise term. The franchisor should extend if franchisee requests. 2.4 Food consumption industry in Malaysia Consumer foodservice experienced a slight growth in 2012 in contrast with it in 2011. It is expected that it will continue to grow between 2014 and 2017 according to Euromonitor International (2013).

Fast food has been increasingly popular in Malaysia because of fast-paced life, time shortage in cities. In addition, a growing number of young people enjoy fast food due to cheap, convenient. Thus, fast food has experienced growth trend in Malaysia from 2007 to 2013 (Euromonitor International, 2013).

2.5 Fast food restaurants in Malaysia Fast food restaurants significantly increase in Malaysia in order to respond to the market needs. To date, fast food outlets exceed 3000 in Malaysia. According to researchers’ views, fast food is the most desirable restaurants and quick meal solution for busy lifestyle around the world. Fast food restaurants are on the basis of franchising business in Malaysia (Faridah et al, 2013).

40% of total franchises

operating are foreign franchises in Malaysia. Unsurprisingly, American franchises for 70% and welcomed by consumers and will go on growth due to disposable income growth and growth of western influence (Faridah et al, 2013). The most successful franchise restaurant is KFC, which dominates the Malaysian market, has over 500 outlets. While McDonald’s owns over 200 restaurants lied throughout Malaysia and it is estimated that it will be swelling annually up to 20-25. Euromonitor International reported that McDonald’s illustrated sales growth from 2009 to 2012 (Faridah et al, 2013). 2.5.1 Factors influence in restaurant selection Consumers feel good and enjoy joyful experience when eating out in contrast with eating at home. Faridah et al (2013) noted that restaurants are classified into two categories: fast-service and full service restaurants. Thus, customers have distinct dining experiences in each type of restaurant. Sulek and Hensley (2004) stated that restaurant selection of customers mainly depends on four components, namely food attributes, physical surrounding, service quality and socio-demographic profiles. Food attributes As for food attributes, quality of food is a vital factor for any restaurants. Food attributes are likely to vary. However, product is thought as technical quality but based on invisible food quality, such as food arrangement and size or portion of food. Additionally, food aroma is considered as strong quality indicator. (Kincaid et al, 2010) noted that the concept of food and service consist of presentation, the variety, and the quality of menu. They added that higher quality can bring customer loyalty to restaurants. However, Joshi (2012) classified food quality into sub-elements making up of taste, menu variety, food presentation, healthy food choices as well as familiar food. In general, majority of researchers favored that food quality is vital factor in identifying customer satisfaction and loyalty. Physical surrounding

Physical surrounding influences customers in selecting restaurants. Kujisters, Redi, Ruyter and Heynderickx (2012) stated that environment potentially affects customers’ mood. Physical environment comprises of temperature, noise, air quality, music, odor, layout, equipment, sign, style and furnishing. Atmospheric covers invisible and visible environment characteristics. Visible quality covers physical elements and can be managed by bosses in restaurants. On the other hand, invisible factors refer to invisibly environmental background and are more likely to influence customers’ nonsenses as well as subconscious effect. Good environment with good meals might improve customer satisfaction and loyalty even positively affects customers’ behaviors. Service quality Good service can bring good experience to customers so it directly determines customers in selecting restaurants. Besides, service quality is associated with return patronage and customer satisfaction. The 5 dimensions of service quality make up of tangibles, responsiveness, reliability, assurance and empathy. 2.5.2 Impact of socio-demographic profiles in restaurant selection Socio-demographic profiles may influence restaurant selection because portion of food allures customers as driving factor and is marketing strategy to promote restaurant (Kivela, 1997, and Kivela et al, 2000). In addition, young people aged 30 to 39 with kids and working people trend to have distinct criteria in selecting restaurants and enjoy restaurants near home. While retired people don’t care for locations of restaurants. Food quality is not key attribute for young customers in contrast with customers aged over 60(Kivela, 1997, and Kivela et al, 2000). Another segment by age, the retired people aged over 65 lack of regular income and consumers aged 35 to 44 may face a heavy financial burden, thus they are more likely to less dine out and income becomes one of factors of return visit (Kivela, 1997, and Kivela et al, 2000). However, consumers with middle and higher income may trend to dine out in nice and comfortable restaurants. Euromonitor International in 2012 reported that young consumers with financial independence trended to pay more for eating out at full service restaurants or cafes which can offer better environment to customers. Additionally, young people aged 30 or less 30 with well-education and handsome incomes are more likely to be picky in tastes and preference (Faridah et al, 2013).

3.0 RESEARCH METHODOLOGY 3.1 Research design and Procedure Research design constitutes a blueprint for the collection, measurement, and the analysis of data. It is a plan and structure of investigation to obtain answers for research questions. The plan is the overall scheme or program of the research. This is a correlation study. This study was connected among the INTI students and their attitude towards food truck. The hypothesis testing was attempted to explain the variances between independent variables to predict relationship. This study was conducted under the non-contrived setting. The variables are neither controlled nor manipulated. Data were gathered from willing respondents in Nilai.

3.2 Population, sample size and sampling technique We are using the non-probability sampling method as time constraint and convenience to get enough respondents. In addition, the cost of using this method is cheap and it is feasible. There are 129 sets of survey questionnaires are distributed and 100 sets of them are being collected and used in this project successfully.

3.3 Scales and Measurement This survey’s questionnaire includes six sections. The respondents were asked to read and indicate their agreement or disagreement with each of the statement designed at question seven to question twenty-two using the 5-point scale. Number one means strongly agree, number two is agree, number three is neutral, number four is disagree, number five is strongly disagree. The type of measurement of the 5-point scale used

in independent variable is the Likert scale. The respondents are asked to respond to each question based on their senses toward food truck. Section one is about the demographic variables is measured by using nominal scale. Section two is about Flaming Wheels, section three is about the service quality, section four is about food quality, section five is about the environment of Flaming Wheels, and section six is about the price of Flaming Wheels. For section one, the demographic variables are measured by using nominal scale.

3.4 Hypotheses i)

H1: The higher the level of reliable, the greater the level of customer satisfaction.

ii)

H2: The more reliable the service (responsiveness) provided by Flaming Wheels, the greater the level of customer satisfaction.

iii) H3: The more physical feature provided by Flaming Wheels, the more the level of customer satisfaction. iv) H4: The less price the accordance of actual price with expectation, the lower level of customer satisfaction

3.5 Independent Variable The independent variable is defined as the presumed cause of some changes in the dependant variable (Robbins, 1998). This report presents the four independent variables that are reliable, responsiveness, physical features and price. 3.6 Dependent Variable Dependent variables are the key factor that has been looked into to explain or predict if they are affected by some other factors. The dependant variable for this study is customer satisfaction.

3.7 Data Collection Method In this research, the relevant data had been collect by using survey questionnaire. Survey questionnaire is appropriate in this research because it is the most suitable method to achieve the research’s objectives and make the selected respondents easier in their evaluated. This method able to reduce and limit the chances of failure for reacquires the questionnaire after being filled by the respondents. In addition, this method can reduce the costs, time and efforts needed to get sufficient respondents and to ensure the data obtained are truthful and sincere. The questionnaires were distributed to INTI students. Most of the respondents take 5 to 10 minutes to complete the questionnaire. These questionnaires were collected on the spot right after the respondents had completed it.

3.8 Statistical Data Analyses The relevant data collected throughout the questionnaire from the respondents was edited, coded and analysed into the computerized SPSS (Statistical Software Package for Social Science) software version 20.0. Subsequently, the data are summarizing into descriptive, linear multiple regression and inferential statistics. 3.8.1 Descriptive Analysis Descriptive analysis refers to the transformation of the raw data into a form that will make them easy to understand and interpret (Zikmund, 2000). Descriptive Analysis is done to get a set of the data and all the complex data are simplified so that they are easier to be interpreted. Prior to hypothesis testing, descriptive analysis was performed to examine the normality for each of the variables. There are three measures of central tendencies such as mean, median and mode. Mean or average is a

measure of central tendency that offers a general picture of the data without unnecessarily inundating one with each of the observations in a data set (Sekaran, 2000). Median is the central item in a group of observation and mode mean the most frequently occurring phenomenon. 3.8.2 Regression Analysis Multiple regression analysis (the term was first used by Pearson, 1908) is a statistical technique that can be used to analyze the effect of two or more independent variables on a single interval-scaled dependent variable (Zikmund, 2000). The objective of multiple regression analysis is to use the independent variables whose values are known to predict the single dependent value selected by the researcher (Hair, Anderson, Tatham and Black, 1998). In selecting suitable applications of multiple regressions, there are three primary issues to be considered. First the appropriateness of the research problem, followed by specification of a statistical relationship and finally the selection of independent and dependent variables (Hair, Anderson, Tatham & Black, 1998). In this study, hierarchical regression analysis was performed to test the hypotheses and explain the relationships between the independent variables which are: service quality, food quality, dining experience, price, and the dependent variable is customer satisfaction. Before doing the multiple regression analysis, there have four assumptions that need to be incorporated in the test.

3.9 Theoretical Framework Based on the extensive literature, 5 Counselling centre characteristics (reliable, responsiveness, physical features and price) have been identified probably having an impact on Participant rate and these characteristics are standing as independent variables in the framework.

H1 ： Reliable

H2: Responsiveness

Customer Satisfaction

H3: Physical features

H4: Price Figure 3.1 Theoretical Framework- Customer Satisfaction for food truck

4.0 ANALYSIA AND RESULT 4.1 SWOT Analysis of Flaming Wheels. SWOT analysis method is used to strategic analysis of cost in business, it can give play to advantage of enterprise, use the opportunities to overcome the weaknesses, avoid risk, maintenance advantage of cost. Using SWOT makes strategy of control cost set up on the analysis factors of internal and external and base on judgment for competitive landscape. And it also provide methods and road for fully understand the enterprise's strength, weaknesses, opportunities and threat, at the same time it also provides methods of facing risk, analysis facing chain. (Nadine pahl, Anne Richter 2001) Based on the SWOT analysis, The following is Flaming Wheels company current business position. (Nadine pahl, Anne Richter 2001 SWOT Analysis- idea, Methodology and A practical Approach) 4.1.1 The strengths First of all, Flaming Wheels provides various flavored food including snacks& cravings, pasta, burgers, hot pot and light & easy and so on. So as to cater for multicultural customers, nothing else fast food restaurants can offer, at the same time, it

also has a great development on its food innovation. Secondly, Flaming Wheels provides various flavored food, it can satisfaction consumer preferences of different regions, including Malay food, western food, Chinese food, as well as Indian food. it compare with the western-style fast food, it has an absolute advantage on the local taste, because although the western-style fast food has taken a certain of localization measures for adapt to local taste preferences of consumers, but the western-style fast food in order to ensure the commitment of global can eat same food, the tastes of food change little. And it is a local restaurant, all of its material of food used by local material, it does not need to allocation from the field. So it is very fresh. At the same time, its food collocation is very reasonable and it has many of cooking methods, it is very accord with healthy eating trend. 4.1.2 Weakness There are some weaknesses to Flaming Wheels, at least when compared to traditional restaurants. Initially, the smaller size of the mobile food truck means that there is typically less place to let customer eat at a venue with a permanent location. This scenario limits the size and development of the truck's business. Additionally, maintenance costs may be increased quickly, as vehicle repairs will become another essential step in equipment maintaining. The annual maintenance costs will add gradually. Finally, Flaming Wheels can be short of expertise in preparing popular desserts and other cuisine. It is important to maintain a diverse menu for a company's development. This allows the food truck to stand out in a market competition. 4.1.3 Opportunity The catering has a huge of development potential. On the one hand, the market of catering has a large capacity, the market of goals including crowd of leisure and shopping, urban migrants, crows of tourist, office worker lunch, group caterers and students. In fact, currently those market of goals the development is not enough. On the other hand, according to the industry growth study, catering has been continuously growing for several years in Malaysia, and it has been higher than GDP growth rate over the same period, and the growth rate of fast food industry is higher than the catering average. Thus, the Flaming Wheels can using this opportunity built the sales point in the downtown area and nearby school and population concentrated area of everything target markets, taking over the market opportunities, in today's Malaysia, although the food truck everywhere, but the large scale and chain operations is very

few, so the Flaming Wheels can using its unified supplying material of food and unified management to be a NO. 1 of food truck in Malaysia. 4.1.4 Threats In today's market of fast food in Malaysia, the fast food of western-style has a rapid development, such as McDonald, KFC, Pizza hut and so on, all of them not only already occupied the most of Malaysia fast food market, but also gradually changed the view of diet of Malaysia, those western-style fast food restaurant according to the local religion and habit of diet, continue produce food of suite for local residents. Thus, the Flaming Wheels as a new fast food restaurant has a lot of competitors, and all of those competitors is the companies of fortune 500, and those competitors has a high market satisfaction. At the same time, on the one hand, the price of menu in Flaming Wheels is similar with its competitors, so many of people prefer to chose those international brands, On the other hand, due to the Flaming Wheels is a food truck, it belong outside restaurant, and Malaysia in the tropics, every is very hot and every usually has the rain, so people prefer to eating in the indoor. And it as a food truck, it must be parking roadside, if the government want to guarantee traffic smooth and aesthetics of city, it will restrict Flaming Wheels operating hours or interdict it operate, so it is very danger for the Flaming Wheels. 4.2 PEST analysis of Flaming Wheels The PEST analysis is a way of helping enterprise review their external macro environment, it refers to the analysis of the macroeconomic environment, the macroeconomic environment is also called the general environment, it means the various of macro forces impact all industries and enterprise. Analysis the factors of macroeconomic environment, the different industries and enterprises are according to their own characteristics and demand of operate, the contents of analysis will be different, but generally it also deal with political, economic, society and technology those four main external factors which affect the enterprise to analysis. In simple , it named PEST analysis. (Phillip Weber 2010) Based on the PEST analysis, The following is Flaming Wheels company current business position. (Abercrombie & Fitch. Marketing Analysis: A macro-environmental and competitive audit Phillip Weber 2010 3th) 4.2.1 Political factors. Political environmental factors, is that the real or potential impact of political power,

laws and regulations can influence the organization and operation activities. Political factor is profound influence on the development of enterprise, then the rise and fall of an industry largely depends on whether or not to political regulations. The political situation in Malaysia is very good and peaceful. This is conducive to the stable development of the economy. Cardiovascular disease, high cholesterol level, and obesity are a serious problem in Malaysia. Currently, because of health problems, the government is controlling the fast food industry. Government reinforces the management of the fast food restaurant, including all the food industry. For practitioners in catering industry, understanding of the relevant policies and regulations is extremely important. Practitioners and the government should maintain a good and intimate relationship, so that they can get a win-win situation. Enterprises can use the state's policy and get a great opportunity for development. Otherwise, with the changing market access standards, development of the fast food industry is still a challenging in the future. 4.2.2 Economic factors Because of the rapid development of national economy in Malaysia, making the most of the national income has been increased and making the national purchasing power is growing, especially in service sector, manufacturing sector and construction sector. In addition, the unemployment rate has averaged just 3.31% since 1998 until 2013. However, people have a same aim to increase more revenue and save more time, most of the white-collar or student choose fast food as their lunch. Because of the fast food lunch may be compared to other species, such as Chinese food, western food, Indian food, etc., it can satisfy people's physiological needs fast and make them faster to go into the state of working or studying. The second important factor causes the appearance of the Flaming Wheels, because, its price is not expensive than other meals and may be cheaper than other meals, so that people save the mealtime and save the meal cost. The emergence of an industry will have its consumer groups. The emergence of a product which will have it’s a people who have ion on it. Flaming Wheels operated until now that because this product must have fixed consumers and flowing consumers, who its industry. In addition, in Kuala Lumpur, rent fee and manual work are the most of the spending in a company operating. However, Flaming Wheels company use flowing operation and program production, thus, this company can have no rent and reduce the staff, which decrease the company's

operating costs and make its net income increased. This is one reason that Flaming Wheels can survive. 4.2.3 Society Factors The society factors to check here it should be include cultural aspects, the consciousness of health, rate of population growth, and age distribution, and the career attitudes. According to the Flaming Wheels, due to the Flaming Wheels company is operating in Malaysia, so if it want sale its food to anyone, it must be comply with local religions institution of Islam, so if some non-Islam want to eat some pork, they will choose another restaurant. And with the times development and social progress, the rhythm of life is very fast, so whether office workers or students are very busy, so in general they will choose fast and near place to eating, it is good for the Flaming Wheels food truck, but with the standards of living is improve, people more and more attention to the health, when they are working, they may be choose the Flaming Wheels, but they prefer to cook healthy food by themselves when they are free. In fact, the children and young people likes fast food, the old people like cooking at home, so the age distribution is also effect the Flaming Wheels, the company should be build its sales point in the campus or work area and the commercial district. A the same time, the rate of population growth is also effect the Flaming Wheels, the number is deciding the power of purchasing. 4.2.4 Technology Factors Before mobile food truck launched in Malaysia, it already has opened in the United States, Canada, Japan and other countries. Flaming Wheels has accumulated a wealth of experience and technology. Absorbing the successful experience and technology of other countries to open stores in Malaysia, it offers favorable conditions existing in all aspects. These valuable business experiences constitute successful development technology environment and provide adequate technical impetus for the development of Flaming Wheels. Flaming Wheels enter the Malaysian market, bringing a new business model for mobile operators and refreshing mobile food truck decor and management system of mobile food truck. It promoted the Malaysian food industry, especially the fast-food industry to upgrade technology and rapid development. In comparison with the traditional fast-food restaurant, Flaming Wheels represented mobile food truck at the technical level is far ahead. In Flaming Wheels, through a variety of precision, high efficiency, integrated system program manages all aspects of restaurant operations.

Compared with other fast food, Flaming Wheels’ competitive performance is in the equipment, production automation and process systematization, as well as a high level of quality of service. Flaming Wheels bring the new concept for food industry in Malaysia is different from the traditional concept of fast food. It meets the growing number of consumers’ expectations and requirements of living diversified, highquality, convenient. 4.3 SPSS Analysis 4.3.1 Results of Demographics Questionnaires distributed to 129 respondent customers, but 29 of them answered that they did not know Flaming Wheels. It shows that 60 percent of the respondents are male and 40 percent are females. 45 percent of the respondents are students of Bachelor Degree followed by students who has or doing Master Degree (35 percent), Diplom and below students are 11 percent and participants have PhD (5 percent). Frequency

Valid

male female Total

Gender Percent

60 40 100

Valid Percent

60,0 40,0 100,0

Education Level Frequency Percent Diploma or below Bachelor Degree Valid Master Degree PhD Total

60,0 40,0 100,0 Valid Percent

Cumulative Percent 60,0 100,0

Cumulative Percent

15

15,0

15,0

15,0

45 35 5 100

45,0 35,0 5,0 100,0

45,0 35,0 5,0 100,0

60,0 95,0 100,0

Table 1：Demographic frequencies and percentage 4.3.2 Reliability of Construct Measures of constructs (Likert scales: strongly agree-strongly disagree) Responsiveness: Service quality was prompt. Staff is friendly. Staff is knowledgeable. Reliability: I think food in Flaming Wheels is delisious. I'm satisfied of Flaming Wheels’ food quality. . I think the food was fresh. . I think the food in Flaming Wheels is healthy.

Physical feature: I think location of Flaming Wheels is comfortable. The environment near Flaming Wheels is always clean. I like design of Flaming Wheels truck. I think the hours of work Flaming Wheels is comfortable. Truck table is always clean. Price: Food items were expensive. You paid more than you had planned. 4.3.3 Multiple-regression analysis Multiple-regression analysis was used with the four factors as independent variables to test the model for customer satisfaction (table2). Table 2 Multiple regression results (dependent variable: satisfaction) Model Unstandardized Standardized t Sig. Coefficients Coefficients B Std. Error Beta (Constant) .100 .274 .365 .716

1

reliability

.241

.090

.231

2.698

.008

price

.235

.087

.190

2.689

.008

physical

.197

.076

.198

2.607

.011

Responsiveness

.386

.082

.393

4.698

.000

a. Dependent Variable: sat

The full model was found to be significant as indicated by the overall F-statistic (p= 0.000). The regression model explained 60 percent of the variation in the dependent variable, satisfaction, as indicated by the adjusted R2 value (table 3). All four factors had a significant effect on customer satisfaction. These include Reliability (b= 0.241; p = 0.008); Price (b = 0.235; p= 0.008); and Physical features (b = 0.197; p = 0.011) and Responsiveness (b=0.386; p=0.000). The results suggest that our modified model explains customer satisfaction in the Flaming Wheels reasonably well. The standardized beta values suggest that responsiveness has the greatest impact on customer satisfaction. Also all factors were also determined to be significant, having an impact on customer satisfaction in that order. Table 3 Model Summaryb Model R R Square Adjusted R Std. Error of Square the Estimate a 1 .774 .600 .583 .704 a. Predictors: (Constant), responsiveness, price, physical features, reliable b. Dependent Variable: sat Table 4 Model

ANOVAa df

Sum of Mean F Sig. Squares Square Regression 70.625 4 17.656 35.586 .000b 1 Residual 47.135 95 .496 Total 117.760 99 a. Dependent Variable: sat b. Predictors: (Constant), responsiveness, price, physical features, reliable 4.4 Findings This study tested a model of customer satisfaction for Flaming Wheels using the transaction-specific framework. The results suggest that our model satisfactorily explains customer satisfaction and that full service restaurant owners and managers should focus on four major elements – reliability, price, physical features and responsiveness – if customer satisfaction is to be treated as a strategic variable and enhanced.

According the results, it was identified that the service quality (responsiveness) has more

influence

on

customers.

The

Responsiveness

includes

all

the

communicativeness of the employees with the customers with meaning whether the employees were prompt, courteous and knowledgeable. That courtesy and knowledge of the menu, generally considered as assurance items, loaded with measures of service quality. In the restaurant industry, one could easily look upon a server who is knowledgeable about the menu and can answer to customer requests or questions effectively; consequently, it could be seen as a service quality item. Managers should to develop suitable programs and provide training on the various factors of responsiveness to strengthen employees’ ability to improve customer service. Although easy to suggest, deploying these qualities in the operational personnel and gaining their commitment can be challenging. By doing so, managers of Flaming Wheels can design targeted training programs that encourage employees to implement this dimension of service quality. According to the regression coefficients, price expectation was determined to be next in importance in influencing customer satisfaction. The negative beta value suggests that when prices are not in accordance with expectations, customer satisfaction declines. It should be with negative direction. As our research suggested, Flaming Wheels customers typically have internal reference prices stored in their memories. Hence, if prices on the menu are higher than what the customer expects, customer satisfaction will be not satisfied. It is important, therefore, for Flaming Wheels to assess competitive prices and customers’ reference prices for a selected segment in which they desire to position their offering. Another important variable is Food Quality. Flaming Wheels offers tasty and healthy fast food. In Nilai area people prefer to go eat outside but not to cook at home. Perhaps, this played the role. Other important factor is Physical features. Physical features includes design, cleanness, location and hours of work. It also has influence on customer satisfaction. We believe this model for assessing customer satisfaction in the full service Flaming Wheels is a useful one. We also believe that if Flaming Wheels’ managers truly want to gain a competitive edge, they must continually strive to increase the levels of customer satisfaction by emphasizing the four significant factors discerned in this study and as suggested by the transaction-specific model.

5.0 CONCLUSION The fast food franchise industry has experienced continuous growth over the previous 3 years and is forecast to continue to grow each year. This is good news for any perspective franchisee. A franchised fast food establishment provides a franchisee with not only full training programs and continued but also with strong brand recognition. In Malaysia, 40% of total franchising are fast food restaurants. It is big market to start business with growing opportunities. The nature of Flaming Wheels services encourages customers to demand the highest possible quality. In order to achieve this, it is essential to be very close to customers to

capture information on customer current and future needs, expectations and perceptions. The main objective of this study was to examine the effect of service quality on customer satisfaction. This study posits and develops an instrument of service quality, and examines the relationship between perceived service quality and customer satisfaction SERVQUAL appears to be a consistent and reliable scale to measure food truck service quality, and provide a useful diagnostic role to play in assessing and monitoring service quality in restaurant business. The results of this study indicated that service quality is an important antecedent of customer satisfaction this result consistent with results drawn(Andaleeb and Conway, 2006; Gotlieb et al., 1994; Buttle, 1996; Zeithaml and Bitner, 1996; Lee et al., 2000; Zeithaml and Bitner, 2003 ). Five dimensions of service quality have significant influence on customer satisfaction. These dimensions include price, reliability, responsiveness and physical features. Moreover, our findings show that service quality is an important factor of customer satisfaction. This finding reinforces the need for managers of Flaming Wheels to place an emphasis on the four dimensions of service quality. In the paper analysis of franchising in Malaysia and it’s procedures was made. The main points of franchising were emphasized and the main laws were studied. 6.0 RECOMMENDATION This chapter will initially discuss on the result of the analysis which is the statistical result in chapter 4. It recapitulates the study besides doing the discussion about the major findings. It also discusses about the implication and limitation of this study. Useful suggestions are highlighted for the research in future. Then, an overall conclusion is come out. 6.1 Recapitulation of the Study. This main purpose of this study is to discover the factors that affects franchisees attitude towards franchising the food truck named Flaming Wheels in Malaysia. It is important and needed to increase the purchasing of Flaming Wheels. The Malaysia is a developing country in the world, the GDP per capita is a standard of measuring the living standard of people, and in currently, the GDP per capita of Malaysia is a growth

trend, it means the purchasing power parity in Malaysia is more and more strong. Thus, the household expenditures on food budgets of Malaysian will be appropriately increase. Due to the transformation of the society, the pace of life is faster and faster, the fast food has trend towards greater consumption. And with the development of economy, the rent of store also increased, so the food truck is a good choose. The Flaming Wheels is a good research object for research development of food truck industry. Thus, several variables were used to substantiate the research problem. There are service quality, food quality, price and dining experience. At first, due to the cost of food truck is low than physical store, so in general the food trucks can gives a low initial fee for franchisees, and from the growth rate of development of food truck, it showed a trend of increase, so in Malaysia will be has the same trend. Thus, the Flaming Wheels can follow the KFC and McDonald set up the model of franchising, this is the first step of expand market. By the franchising, the company can sets up cooperative relationship with franchisees in long term, at the same time, it also can helps company avoid the investment risk and collect more capital in order to research and development better food and provide better service. And by the training franchisees, set up a g well-trained marketing sales group, by the franchisees give customers ample opportunity to recognize food trucks. If company wants to attract more franchisees Flaming Wheels, it should be determine the target market and the satisfaction of customers, because only more and more customer like and choose the Flaming Wheels, the franchisees will choose Flaming Wheels. In general, the franchisees pay attention to the profit. Therefore, the Flaming Wheels can follow development the aspect of product, price, place and promotion to attract franchisees. 6.2 4P Strategy We can use the 4P Strategy to analyze and give some recommendations. Each of the four Ps has its own strategy to contribute to do franchising: 6.2.1 Product strategy. At first, for the Flaming Wheels, the target market should be located in the students and office workers. For those two groups, on the products of Flaming Wheels should be provide more new product and it should be attention to provide the healthy products, at the same time provide different taste of product for different people , and the company must be guarantee all of franchisees food is fresh and has a high quality.

On the other hand, the Flaming Wheels should be concentrate develop some start product in order to hold and increase the loyalty of customers. A start product can makes a lot of people to follow your brand, it will bring the unexpected gains. 6.2.2 Place Strategy The place of sale point is a very important factor for the restaurant, the visitors flow determine revenue level, it is a key factor for success. According to the target market, the company should be set up the sales point near by the campus and the Central Business District (CBD), these two areas has a big visitors flow, and students and office workers is very busy, they do not have more time spend on the eating, so the fast food is their first choose. At the same time, nowadays, people always have quickly lifestyle, they may busy with work and don’t have time to cook the food they’d like to eat, or those people who are lazy to cook, more prefer the frozen food which are convenience and save time. So the food truck of Flaming Wheels also should be set up the sales points on the residential communities. After open the target market, the company should be expanding to the market, and it should be open the sales point to the more area, such as shopping mall, airport, square, and so on. The food truck as a fangled thing with an unique and interesting atmosphere. When the new franchisee s the Flaming Wheels, the company should be helps franchisee research the market and help franchisee choose the good sales point, and guarantee tow food truck cannot be too close. 6.2.3 Pricing Strategy As the competitions among fast food in Malaysia are intense and fierce, the Flaming Wheels finalized to choose cost should be based pricing strategy and competition based pricing strategy as company first choose. At the same time, the prices are set based on what competitors are charging or what they will charge, because the price is an important factor for customers, on the one hand, in general, if the price is too high, the customer will choose other lower price restaurant, and it is difficult to withstand repeated consumption. But if the price is too low, the customer will consider the quality of food. On the other hand, it is also an important factor for repeat purchases. A reasonable price is an important factors for attract customers, and it is also an important factor of guarantee franchisee benefit. 6.2.4 Promotion Strategy As a newly established restaurant, the most important things for the Flaming Wheels is helping franchisee positively known and accepted in Malaysia. And then, it must

have plenty of channels which could directly or help franchisee make a plan in order to indirectly reach to potential customers. At first, The Flaming Wheels will mainly do some advertising on traditional media and new media, Such as newspaper, TV Program and popular website such as Facebook, Twitter, and so on. It is aim to help the franchisees of Flaming Wheels positively known and accepted by the public of targeted market segment. Then, carry out the festival promotion, in the any festival the Flaming Wheels should be give consumers some vouchers or discounts, at the same time, the company should be make a plan for old customer, the company should be set up a model of point, such as a customer eat once Flaming Wheels, the restaurant can give this customer certain point, there are more points, the customers will be get more preferential. By this way, it can increase popularity of Flaming Wheels, at the same time, it also increase popularity of franchisee, a high popularity can helps franchisee attract more customers, and it also can attract more and more franchisee the Flaming Wheels.

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