5. final ch 15 man3600. 3 Describe the advantages and disadvantages of licensing. 4. The entry strategy in global business with the lowest risk is _____, while _____ is considered to have higher risk than the choices available. 2 Franchising as an expansion strategy. All of the above. Arrangement in which an independent company is licensed to establish, develop, and manage the entire franchising network in its market and has the right to subfranchise to other franchisees, assuming the role of local franchisor; 6. is a contractual agreement whereby one company (the licensor) makes a legally protected asset available to another company (the licensee) in exchange for royalties, license fees, or some other form of compensation. The license agreement permits the use of trademarks, nothing more. Flashcards. Franchising: more complex form of licensing in which the franchisor allows a franchisee the right to use its entire business system in exchange for compensation. Franchising is an example of a contractual vertical marketing system. In other words, a licensing agreement grants the licensee the ability to use intellectual. Ask AI New. Franchise: A franchise is a type of license that a party (franchisee) acquires to allow them to have access to a business's (the franchiser) proprietary knowledge, processes, and trademarks in. Financing is more costly in other countries. licensee: In a licensing relationship, the buyer of the produce, service, brand or technology being licensed. Flashcards. Verified Answer for the question: [Solved] _____ is a fee paid periodically to compensate a licensor for the temporary use of its intellectual property, often based on a percentage of gross sales generated from the use of the licensed asset. Franchising suggests the use of a whole package of signature products and business solutions, whereas licensing allows entrepreneurs to leverage certain individual property and produce and. Learn this differs between licensing and franchising and why general is not an alternative for franchising. • About 70 percent of the more than 2,000 Body Shop stores worldwide are operated by franchisees, while the rest are owned by Body Shop headquarters. According to Franchise Business Review, franchising fees typically range from $25,000-$50,000 on average. They typically include the exchange of intangibles and services. For courses in international business. - Governed by a CONTRACT that provides the focal firm a moderate level of control over the foreign partner - Typically involve exchange of INTANGIBLES (intellectual property) and services - Can be pursued independently or with other foreign market entry strategies, such as FDI and exporting Licensing and franchising both offer advantages for the involved parties: The licensee and franchisee both gain a competitive advantage in the market. Franchising is an advanced form of licensing in which the the franchisor allows the franchisee, the right to use an entire business system in exchange for compensation. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features NFL Sunday Ticket. 15. licensing. 2. a. Process. Table 7. Study with Quizlet and memorize flashcards containing terms like Contractual Entry Strategies in International Business, Intellectual property, Intellectual Property Rights and more. Two Types of Contractual Relationships. economic output and, depending on your needs, goals and circumstances, may be the right choice for you. B. make it easy for later entrants to win business. 14). OTHER CONTRACTUAL ENTRY STRATEGIES -Under build-operate-transfer (BOT) arrangements, the firm contracts to build a major facility, such as a power plant, which it operates for a period of years and then transfers to the host-country government or other public entity. Licensing, Franchising and other Contractual Strategies Cross-border contractual relationships: give permission to use intellectualWhen the executives in charge of a firm decide to enter a new country, they must decide how best to do it. 15. accepting a business model for doing a business in a traditional manner. Mode Characteristics Advantages Disadvantages. Licensing: Licensing is defined as "the method of foreign operation whereby a firm in one country agrees to permit a company in another country to use the manufacturing, processing, trademark, know-how or some other skill provided by the licensor". Business format franchising accounts for most of the explosive growth in franchising that has occurred in the past five decades. When considering the three basic decisions a firm must make when it decides to enter a foreign market, it must determine the market. , licensing and franchising) have lower up-front costs than investment modes do. Protecting Intellectual Property. turnkey contracting. Licensees can re-sell the IP at a higher price or manufacture merchandise with the IP on it. d. 6 Understand other contractual entry strategies. An industrial design is intended to ________. 70. A) bribe government officials to reduce nontariff trade barriers B) have a subjective view of moral and ethical standards C) conduct advance research on the host country's laws on intellectual property D) appoint managers from the. These contractual methods can be seen in many forms such as international licensing and franchising. When the parties make licensing or franchising agreement, the parties should critically. contractual agreements. Docsity. Under a franchise agreement, a company grants a foreign company the right to use its brand name and sell its products. Ch. A franchised. 8. A license is “a contractually transferred right to use a legally protected or unprotected in vention in exchange for a fee or another type of compensation” (Mordhorst 1994, p. wholly owned subsidiaries. Chapter 16- Licensing, Franchising, and Other Contractual Strategies Flashcards | Quizlet Chapter 16- Licensing, Franchising, and Other Contractual Strategies 5. Learn. Licensing, Franchising and. 1 International Entry Modes 7. A) the licensee B) patent. The difference between licensing and franchising is that franchise agreements involve an extensive business relationship between franchisor and franchisee whereas license agreements are limited and relate to a. Global Strategy and Organization; 12. They provide dynamic, flexible choice. The Five Common International-Expansion Entry Modes. Ch. In franchising, decision rights encompass the assignment of rights for use of system- and outlet-specific assets in contracts. Flashcards. Merger and Acquisition ii. Created by. Cost of Licensing vs. Quiz 15: Licensing, Franchising, and Other Contractual Strategies. 4 Understand franchising as an entry strategy. strategies. 15. It described the development of Chinese hotel industry at the end. Franchising; Meaning: This is a contractual agreement in which one firm gets access to another firm’s patent, technology and other things in exchange for money. Geb 3375 Introduction to International Business – Study Guide Exam 3_ Part1 1 Introduction to International Business Study Guide Exam 3 – Part 1 Chapter 16: Licensing, Franchising and other Contractual Strategies With this chapter we continued the “entry strategies” part we had interrupted for exam 2. S. Licensing, Franchising and other contractual strategies. ( Multiple Choice) Question 2. licensing, Strategic alliancesA detailed list of issues pertaining to termination and renewal terms The advantages and disadvantages of franchising are similar to those of licensing. 4 Franchising 7. In existing literature, most strategies are appraised as alternatives to exporting, or as alternatives to green-field FDI. While franchising involves a more comprehensive relationship in which the franchisor provides ongoing support and guidance to the franchisee in addition to granting the right to use its business model and brand. Exhibit 15. Solved . Learn vocabulary, terms, and more with flashcards, games, and other study tools. Change Message. Global Market Opportunity Assessment 348. Licensing of IPRs is at the heart of a franchise contract. Licensing, Franchising, and Other Contractual Strategies. Franchising is governed under the Franchise Act 1998 (“the Act”) and is regulated by the Registrar of Franchises (“Registrar”) under the purview of Ministry of Domestic Trade and Consumer Affairs. Contractual Entry Strategies. - Firms that use licensing often can avoid expensive entry as is usually required in FDI. - includes exchange of intangibles and services. The specific definition of the license. They often. Licensing is giving legal rights to in-market parties to use your company’s name and other intellectual property. The principal advantages of international franchising are: (i) Franchising is a beneficial way to. Exporting. C)It restricts a firm's ability to expand more rapidly abroad. Franchising: Arrangement in which the firm allows u000banother the right to use an entire business system in u000bexchange for fees, royalties or. and industry experts about instructions to franchise your business. Chapter 3 described the approach and methodsUnformatted text preview: 446 Chapter l6 Licensing, Franchising, and Other Contractual Strategies l Include noncompete clauses in employee contracts for all positions to prevent employees from serving competitors for up to three years after leaving the firm. Exporting, joint ventures, direct investment, licensing, franchising, and other forms of an alliance is duly considered as market entry types. Bashar Hassan. True/False . An industrial design is intended to ________. 3 Licensing 7. A) franchise contract is more specific and usually longer in duration. If you think of a franchisor (the brand) as a. Contractual entry strategies in international business. - contract provides focal firm with moderate level of control over foreign partner. Learn. c. It is a form of distribution and marketing in which the company gives the other firm the right to do business in their protected way (Bradley 2005:246). caitlyn_stryker. Brand owners lease their patents, software, or characters to other companies. Learn. focal firm does everything for business and hands it over to customer after training. C) A local firm allows the focal firm to blend into the local market, attracting less. and win! Microsoft Volume. 4 Understand franchising as an entry strategy. Exporting, joint ventures, direct investment, licensing, franchising, and other forms of an alliance is duly considered as market entry types. One of the key differences between a franchise and a license is the limitation set out in licensing agreements. when the factors that contributed to domestic success are transferable to foreign locations. The problems facing franchise companies in international transactions are relatively less formidable than those facing other service sectors. is a contractual agreement whereby one company (the licensor) makes a legally protected asset available to another company (the licensee) in exchange for royalties, license fees, or some other form of compensation. Ctrl+k Search questions by imageRetail franchising is the method of opening a single store under the umbrella of an established name, branding, trademark, and product line. A) A joint venture B) Contract manufacturing C) Licensing D) Exporting E) A Global strategic alliance; Answer: B. docx from BUS 417 at Zayed University. Licensing concerns a product rights or the method of production marketing the product rights. Country Comparatives Guides. An MNC may move into that mode voluntarily (to test the waters, so to speak) or for purely defensive reasons (to prevent a competitor from entering the market or to preserve sales that otherwise would be lost because of a. docx from BUS MISC at Florida State University. Solved . doc from MANAGEMENT BCPC202 at University of Professional Studies,Accra. Brand owners lease their patents, software, or characters to other companies. real business leading guides that top everything from franchises basics to advanced vote growth strategies. Exporting means sending goods produced in one country to sell them in another country. Skip until Main Content. Patents provide inventors the right to prevent another person or company from selling or using an invention for up. Licensing Agreement: A licensing agreement refers to a written agreement entered into by the contractual owner of a property or activity giving permission to another to use that property or engage. Question 14. Solved . It’s crucial to understand the key differences and similarities between these two popular growth strategies. Licensing. Unique aspects of contractual relationships. Study with Quizlet and memorize flashcards containing terms like 1) For Starbucks and other companies whose business models include a service component, it is not recommended that they use one of the following methods for going global. a. B) The franchisor holds much power, including superior bargaining power. ( Multiple Choice) Question 2. There are six basic options available: (1) exporting, (2) licensing, (3) franchising, (4) creating a joint venture or strategic alliance (5) acquisition/creating a wholly owned subsidiary, and (6) greenfield/wholly owned subsidiary (Table 9. Angelica Weiss Chapter 16: Licensing, Franchising, and Other Contractual Strategies Contractual entry strategies in international business: cross-border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit contract Intellectual property: ideas or works created by individuals or firms, including discoveries and inventions; artistic, musical. Chapter 15 Licensing, Franchising and other Contractual Strategies Internatonal Business: Other mark ups and contributions like finance charges, sale of related products etc. _____ these are the items owned by a franchisee that has the same monetary value. if the franchisor has already achieved considerable success in franchising in its domestic market. On the other hand, franchise agreements allow the use of trademarks, additional intellectual. Expert Help. Both licensing and franchising are really fantastic. Match. First, mature products in a domestic market might find new growth opportunities overseas. Quiz 15: Licensing, Franchising, and Other Contractual Strategies Solved Professional Service Firms, Such as PriceWaterhouseCooper, Often Enter Large InternationalLike international licensing, international franchising has certain advantages and disadvantages. industry are franchising and management-service contracts (MSC). Chapter 15 Licensing, Franchising and other Contractual Strategies Internatonal Business:Contractual entry strategies in international business. Chapter 15: Licensing, Franchising, and Other Contractual Strategies Key Elements Contractual Entry strategies in. View Overview. Correct Answer: Access For Free . Study with Quizlet and memorize flashcards containing terms like In the context of international trade restrictions, offering less-favorable exchange rates to certain importers is a(n) _____. Typically include the exchange of intangibles and services. Here are 10 market entry strategies you can use to sell your product internationally: 1. and popular strategies for business expansion. The most common methods firms join international trade are through contractual entry strategies such as direct exporting, franchising, licensing, management contract, contract manufacturing, buying a company, and joint ventures. g. Ensuring ongoing competitive advantage. CHAPTER 15 LICENSING FRANCHISING AND. Licensing, Franchising, and Other. Franchising is another variation of licensing strategy. , Exporting and foreign direct investing are two common types of contractual entry strategies. International Business: The New Realities, 5th Edition caters to a post-millennial student audience, the most diverse and educated generation to date. 4 illustrates the nature of the franchising agreement A typical. firm. Solved . Franchising 5. 1. Licensing offers more controlBy expanding into new territories and regions via franchising, your company’s services are made available to a wider audience, both diversifying and localizing your reach. docx from INT- 113 at Southern New Hampshire University. is defined as a contractual arrangement whereby one company makes a legally protected asset available to another company in exchange for some form of compensation. Verified Answer for the question: [Solved] The reputation of a licensor will be jeopardized by a licensing agreement if the licensee _____. 5 Explain the advantages and disadvantages of franchising. ) Bringing ideas for business in other countries to new markets. Licensing: An arrangement in which the owner of intellectual property grants another firm the right to use that property for a specified period of time in exchange for royalties or other compensation. Governed by : Contract law governs licensing. When the executives in charge of a firm decide to enter a new country, they must decide how to enter the country. foreign direct investment. Co-marketing. Franchising VS Licensing. View Chapter 16 & 17 MAN 3600 from MAN 3600 at Florida State University. Several strategies for franchising in East. These rights are usually protected by a patent or some other intellectual right. Learn. Contractual Entry Modes 3. Global Market Opportunity Assessment IV. A license allows the licensee to use, make and sell an idea, design, name, or logo for a fee. Flashcards. Question 4. RenaeBoleyn. Licensing, Franchising, and Other Contractual Arrangements Michael Z. A) duty B). Includes such knowledge-based assets of the firm or individuals as industrial designs, trade secrets, inventions, works of art, literature, and other "creations of the mind". Internal: Operational. Test. Learn from your partner (and apply that knowledge within your organization) Study Chapter 5: Entry into Foreign Markets flashcards. Licensing: An arrangement in which the owner of intellectual property grants another firm the right to use that property for a specified period of time in exchange for royalties or other compensation. 47 I Use contemporary technology to minimize counterfeiting. The definition is important because franchises are covered by securities law while licenses are covered by contract law. Uploaded By ebrarpatriot. As a disclosure, my company is a franchise providing. Test. Patents provide inventors the right to prevent another person or company from selling or using an invention for up. Study Licensing, franchising and other contractual strategies (Key Terms) flashcards from Lewis Mellor's class online, or in Brainscape's iPhone or Android app. Solved . marijaazz. cross-border exchanges in which relationship between focal firm and foreign partner is governed by explicit contract. -the different modes can be further classified on the basis of equity or non-equity requirements. Licensees "rent" the brand from the owner, but are then expected to use their own expertise, capabilities and resources to innovate, produce, market and sell the. • Understand licensing as an entry strategy. 3. Table 7. Franchising is a contractual arrangement in which the franchisor provides a franchisee the right to use its name and marketing and operational support in exchange for a fee and, typically, a share of the profits. 1. accepting a franchise for dealing with the traditional products. Franchising is a contractual arrangement in which the franchisor provides a franchisee the right to use its name and marketing and operational support in exchange for a fee and, typically, a share of the profits. 15. ,. Markman et al. The present model permits any strategy to be compared with any other strategy. Licensing and Franchising. Test. Conclusion. An industrial design is intended to _____. c. Any licensee can produce and sell products under your name or offer services using your brand. Of course, when Switzerland let the value of its franc 30% against the euro, the cost of exports increased, and Swiss goods when bought with the franc, could be purchased at a large. Licensing A contractual agreement whereby one company (the. Ch. Franchising is governed. b. Homework Help. other contractual agreements and equity modes (wholly owned subsidiary or joint venture). Match. B) They are more susceptible to volatility and risk compared to FDI. com Licensing • A company (licensor) grants rights to intangible property to another company (licensee). Match. Email This BlogThis! Share to Twitter Share to Facebook Share to Pinterest. the advantages of franchising as an entry mode to global expansion are similar to the disadvantages of licensing false the least preferred strategy when a company's competitive advantage is based on technology is the wholly owned subsidiaryA franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand’s trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system. Study with Quizlet and memorize flashcards containing terms like Licensing, franchising and other contractual strategies are considered _____ control strategies, Contractual Relationships between a focal firm and a foreign partner are, Intellectual Property refers to and more. Which mode is to be used in which situation 5. Licensing An arrangement in which the owner of intellectual property grants another firm the right to use that property for a specified period of time in exchange for. Licensing is a contractual agreement whereby, in exchange for a royalty or fee, a company gives the right to another company to use a trademark, know-how, or other proprietary technology. Create flashcards for FREE and quiz yourself with an interactive flipper. Terms in this set (12) Contractual entry strategies in international business. Two common types of contractual entry strategies are licensing and franchising. Two common types of contractual entry strategies are licensing and franchising. Terms in this set (19) Contractual entry strategies. Disadvantages. Contract usually runs five to seven years and is renewable at option of parties. On the other hand, franchise agreements allow the use of trademarks, additional intellectual. Contract manufacturing is also called outsourcing. a. Subscribe to newsletters Subscribe: $29. 6. Provide dynamic, flexible choice. licensing is the limitation placed on licensing agreements. 4. includes exchange of intangibles and services 3. Low control, low local knowledge, potential negative environmental impact of transportation. 2. Verified Answer for the question: [Solved] The reputation of a licensor will be jeopardized by a licensing agreement if the licensee _____. 15. trademark. The strategy is to deter other firms’ entry into the market. A) joint ventures B) licensing C) 100-percent ownership D) exporting E) franchising, 2) For Walt Disney. Internal: Operational. 1. Doc Preview. 2. 7. 2. The firm that grants such authorization to the other firm is known as the licensor, and the firm in the foreign. What Are The Types of International Business. Marketing in the Global Firm 464 17. ( True/False ) Question 1Start studying Ch 16: Licensing, Franchising, and other Contractual Strategies. Franchising is common in manufacturing industries while licensing is primarily used in service industries. - Arrangement where owner of intellectual property grants another firm right to use property for specific time in exchange for royalties or other compensation. Which of the following is key to licensing strategy success? Avoidance of barriers for foreign companies doing business. Royalties. 4. Licensing, Franchising and Other Contractual Entry Strategies - Chapter 15. 1. 25 “Market entry options”). If you want to have more autonomy in business decisions with the freedom to make your own vision come to life. Fast entry, low risk. includes exchange of intangibles and services 3. Typically, the franchise agreement is for ten years. cross border interaction between focal firm and foreign firm governed by a contract. equity mode of entry into foreign markets limited to a contractual agreement. Ch 16: Licensing, Franchising, and other Contractual Strategies. Licensing is governed by a licensing agreement, which involves a one-time transfer of property or rights for a fee. Strategies: Licensing, Investment, and Strategic. Keep in mind, however, this is strictly the franchise fee and doesn’t include other startup costs to open the. Licensing is an arrangement in which a company (licensor) sells the right to use intellectual property or produce a company's product to the licensee, for royalty. Study with Quizlet and memorize flashcards containing terms like Contractual entry strategies in international business, Intellectual property, Licensing and more. 4. The licensor provides no technical support or assistance in most cases. Question 80. Licensing refers to a business arrangement, where a company (licensor) sells its intellectual property to another company (licensee), or the right to produce its products, for a specified fee (royalty). Created by. Question 1. Product Adaption. , patents, trademarks, copyrights) in exchange for a fee or royalty payment. 1. Licensing, Franchising, and Other Contractual Strategies. Methods for General Eintrittspreis into the Total Marketplace. Franchising is governed by an elaborate agreement specifying the responsibilities and duties of both the parties involved. Licensing, on the other hand, is a form of private contract between parties and. In franchise, a franchiser sells a property to the franchisee but controls over the procedures of the business. Flashcards. cross-border contractual relationships share several common characteristics. Study Chapter 16 flashcards. . 13 8. A license is much more limited than a franchise. Direct exporters often sell directly to a consumer (B2C), a business (B2B), or a distributor in a foreign country. c. destineeashlee. Match. Verified Answer for the question: [Solved] Which of the following is an advantage of franchising to the franchisee? A) reduced expenses as the franchisor provides supplies, equipment, and products B) Minimum initial investments or royalty payments are applicable. Ideas or works created by firms or individuals, such asintellectual property grants another firm the right to usethat property for a specified period of time in exchangeView Homework Help - Week 12. Match. Exporting entails selling products to foreign customers. AFM 333 – Ch 16 Licensing, Franchising, and Other Contractual Strategies. governed by a contract that provides the focal firm with moderate level of control over the foreign partner 2. an advanced form of licensing in which the firm allows another the right to use an entire business system in exchange for fees, royalties, or other forms of compensation. Brand licensing is the act of giving permission to another company to use your business’s intellectual property (IP). Compromises between short-term transactions and long-term solutions. Licensing Licensing is a contractual transaction where the firm the licensor offers some proprietary assets to foreign company the licensee in exchange for royalty fees (Kotabe and Helsen, 2010: 301). Learn. 13 8. Difference between licensing and. Question 2. 2 ABSTRACT Presently, companies wanting to engage in international trade have a wide pool of choices to choose from. Market entry modes for international businesses. There are five basic options available: (1) exporting, (2) creating a wholly owned subsidiary, (3) franchising, (4) licensing, and (5) creating a joint venture or strategic alliance (Figure 7. Licensing is a legal process in which one firm pays to use or distribute another firm's resources. Licensing involves an agreement in which one company (licensor) grants another company (licensee) the right to use its intellectual property (e. [afm 333 – chapter 16 li censing, franchising, and o ther contra ctu al stra tegie s] 1 Contr actual entry s tr ateg ies in int ernational business: cr oss-border e x changes wher e the re lationship between t he foc al firm and its f oreign partner is g overn ed by an explicit co ntr act The difference between licensing and franchising is that franchise agreements involve an extensive business relationship between franchisor and franchisee whereas license agreements are limited and relate to a singular activity such as the shared use of a trademark. . Learn. Revenues are usually more modest than with other entry strategies. The legal claim through which the proprietary assets of firms and individuals are protected from unauthorized use by other parties. 82. While extant research revolves around the level of resource commitment and control in foreign activities, non-traditional. Licensing and franchising. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features NFL Sunday Ticket Press Copyright.