1.

0 INTRODUCTIOON
1.1 BackgroundFood 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 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
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 doesnt 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

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 McDonalds 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 McDonalds 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 dont 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 surveys 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 researchs 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
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 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 its 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, 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 1Demographic 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

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 signicant 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 signicant 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 modied 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 signicant, 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-specic 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 coefcients, price expectation was determined to be next
in importance in inuencing 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 signicant factors discerned in this
study and as suggested by the transaction-specic 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 its 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 dont have time to cook the food
theyd 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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