Factors Impacting Capital Expenditures in the Quick Service Restaurant Industry

Document Type

Article

Publication Date

1-1-2017

Publication Title

Journal of Hospitality Financial Management

Volume

25

Issue

2

First page number:

90

Last page number:

100

Abstract

The purpose of this article is to study the factors that impact capital expenditures in the quick-service restaurant industry. The authors hypothesize that growth opportunities, free cash flow, size, corporate earnings, economic conditions, and franchising status will have impact on the capital expenditures of quick-service restaurants. This study analyzed capital expenditure and other financial data on quick service restaurants for the period 2006–2016. Results suggest that corporate earnings, size, cash flow, economic conditions, and franchising have a significant relationship with capital expenditures, while growth opportunities are not associated with capital expenditures. Specifically, a high degree of corporate earnings, large size, and a high degree of cash flow tend to be associated with a high degree of capital expenditures; while favorable economic conditions and franchising tend to be associated with a low level of capital expenditures. © 2017 International Journal of Hospitality Financial Management.

Language

english

Find It

UNLV article access

Search your library

Share

COinS