International expansion of U.S. full-service restaurants: Positive and increasing effects on financial performance

Contrary to conventional wisdom, the current study found that full-service restaurant companies increasingly perform better as their degree of international expansion increases once their international stores reach 8.3% of their total store units, while the impact is significantly lower for quick-service restaurant companies for U.S. based companies. This study argues that various degrees of tacit knowledge required by operating full-service restaurant companies and quick-service restaurant companies explain the major reason for significant differences in success of international operations. As a firm's accumulated tacit knowledge for international operations becomes a source of sustainable competitive advantage, U.S. full-service restaurant companies increasingly perform better than U.S. quick-service restaurant companies; this disparity in performance is due to the relatively easy-to-transfer knowledge and standardized approaches of the U.S. quick-service restaurant companies.