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 passage 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 5-

point, 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

supporting 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 support 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 passing the assessment, franchisors will

continue to the third step. The franchisors will interview with the franchisees.

Fourthly, the franchisor and franchisee discuss the terms and conditions. The

franchisor ensures that the franchisee truly understands terms and conditions and

abides by the rules. If franchisee favors, they go on step 5 referring to signing

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 register 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).

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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

account 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’ non-

senses 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

H2: ResponsivenessCustomer

Satisfaction

H3: Physical features

H1： Reliable

H4: Price

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.

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 multi-

cultural 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

terms, 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 support 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 factorsBecause 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 passion on it. Flaming

Wheels operated until now that because this product must have fixed consumers and

flowing consumers, who support 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, high-

quality, 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).

Gender

Frequency Percent Valid Percent Cumulative Percent

Valid

male 60 60,0 60,0 60,0

female 40 40,0 40,0 100,0

Total 100 100,0 100,0

Education Level

Frequency Percent Valid Percent

Cumulative Percent

Valid

Diploma or below

15 15,0 15,0 15,0

Bachelor Degree 45 45,0 45,0 60,0

Master Degree 35 35,0 35,0 95,0

PhD 5 5,0 5,0 100,0

Total 100 100,0 100,0

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 Coefficients

Standardized Coefficients

t Sig.

B Std. Error Beta

1

(Constant) .100 .274 .365 .716

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 3Model Summaryb

Model R R Square Adjusted R Square

Std. Error of the Estimate

1 .774a .600 .583 .704

a. Predictors: (Constant), responsiveness, price, physical features, reliableb. Dependent Variable: sat

Table 4ANOVAa

Model Sum of Squares

df Mean Square F Sig.

1

Regression 70.625 4 17.656 35.586 .000b

Residual 47.135 95 .496

Total 117.760 99

a. Dependent Variable: satb. 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 support 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 join 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 join 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 joins 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 join the Flaming Wheels.

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