In existing literature, most strategies are appraised as alternatives to exporting, or as alternatives to green-field FDI. Several companies get patent their technology and other products that they don’t want anyone else to use without their consent. Study with Quizlet and memorize flashcards containing terms like Contractual entry strategies in international business, intellectual property, intellectual property rights and more. Terms in this set (19) Contractual entry strategies. Greenfield Strategy v. Exporting. Flashcards. Study with Quizlet and memorize flashcards containing terms like 5 Methods for entering the global market place from least risky/return to most risky/return, Exporting, Licensing and Franchising and more. C. Importing involves purchasing products from other countries and reselling them in one’s own. licensing vs franchising. Chapter 15 Licensing, Franchising and other Contractual Strategies Internatonal Business: Other mark ups and contributions like finance charges, sale of related products etc. 2. c. A license is much more limited than a. These contractual methods can be seen in many forms such as international licensing and franchising. Firms can pursue them independently or in conjunction with other entry strategies. - Arrangement where owner of intellectual property grants another firm right to use property for specific time in exchange for royalties or other compensation. 4 Understand franchising as an entry strategy. The license agreement permits the use of trademarks, nothing more. Licensing is an agreement between Licensor and licensee wherein one organization gives the other organization access to its patents, trade secrets, or technology for a fee known as a royalty. A) joint ventures B) licensing C) 100-percent ownership D) exporting E) franchising, 2) For Walt Disney. Equity-based arrangements. A) should bribe government officials to ensure protection of intellectual property B) should register patents and copyrights with local governments C) should keep information about intellectual property confidential from all franchisees in. Match. 2. Contract manufacturing is also called outsourcing. )*Licensing, Franchising, and Other Contractual Strategies 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 compensationLearn this differences between licensing and franchising and why licensing is not a alternative to franchising. Licensing, Franchising, and Other Contractual Arrangements Michael Z. nontariff barrier d. Licensing A contractual agreement whereby one company (the. management contracts. Patents provide inventors the right to prevent another person or company from selling or using an invention for up. skhaira2118 Terms in this set (26) contractual entry strategies in IB cross-border exchanges in which the relationship between the focal firm & its foreign partner is. After few years, once the know- how is transferred, there is a risk that the foreign firm may begin to act on its own and the international firm may therefore. Exporting, joint ventures, direct investment, licensing, franchising, and other forms of an alliance is duly considered as market entry types. , Exporting and foreign direct investing are two common types of contractual entry strategies. When considering a venture in international markets, there are some significant tactical and strategic decisions to be effected. 2. Contractual entry strategies in international business are cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an. Try Shopify free for 3 days, no credit card required. doc from MANAGEMENT BCPC202 at University of Professional Studies,Accra. Contractual Entry Strategies. Exporting is a method of expansion where. 3. Typically, this licence will cover know-how and other confidential information, trademarks. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features NFL Sunday Ticket Press Copyright. A license is much more limited than a franchise. Patent. dynamic, flexible choices 5. A) markets competing products for significantly lower prices B) uses the licensing asset to create products of poor quality C) refuses to pay the agreed upon royalties to the licensor D) does not guarantee future expansion in the. Licensing, Franchising, and Other Contractual Strategies Internal: strategic Register IP target country chain1. , licensing and franchising) have lower up-front costs than investment modes do. An Introduction A. 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. Quiz 15: Licensing, Franchising, and Other Contractual Strategies. cross-border contractual relationships share several common characteristics. Although both franchising and MSCs are non-equity modes, there are important differences between. A licensing agreement allows a foreign company to sell a company’s. In order to prevent a licensor-competitor from gaining unilateral benefit, licensing agreements should provide for: A) contract manufacturing. Buckley BA (Econ), MA, Phd Chapter 90 Accesses Abstract This. Product Adaption. d. 8. Terms in this set (21) Contractual entry strategies in international business. 1. Try it free3. Question 4. The definition is important because franchises are covered by securities law while licenses are covered by contract law. a. 99/yearQuiz 15: Licensing, Franchising, and Other Contractual Strategies. The organization that obtains the access is the licensee. Many firms build biotech tags,. 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. C) There is no scope to operate an independent. includes exchange of intangibles and services 3. Contractual entry strategies in international business. Licensing and franchising share a few similar advantages. Chapter 8: Global Products. ) Bringing ideas for business in other countries to new markets. Co-marketing. Exporting. The organization that gives the access is the licensor. Licensing ii. 30. 3. Beyond importing, international expansion is achieved through exporting, licensing arrangements, partnering and strategic alliances An international entry mode involving a contractual agreement between two. Second, some firms find it less risky and more profitable to export. 13 8. a. Chapter 16 - Licensing, Franchising, and Other Contractual Strategies. 1 Explain contractual entry strategies. Mode Characteristics Advantages Disadvantages. accepting a business model for doing a business in a traditional manner. Franchising is another variation of licensing strategy. Licensing, Franchising, and Other Contractual Strategies. Under an international franchise agreement, a company (the franchiser) grants a foreign company (the franchisee) the right to use its brand name and to sell its products or services. On the flip side, potential for revenue growth is more limited because the parent company will only earn a percentage of the earnings from each new store. It’s a legally binding document that spells out—in great detail— the integrated touch points of running the business from the franchisor and franchisee point of view. Licensing is a contractual arrangement where a company grants permission to another party to use its intellectual property or brand. 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. Test. - As entry strategy, licensing requires neither substantial capital investment nor extensive involvement of licensor in foreign markets. 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. Type of Entry. B) An Indian automobile manufacturing company buys engines from a Japanese manufacturer for its. Can be pursued independently or in conjunction with other entry strategies. Firms need to evaluate their options to choose the entry mode that best suits their strategy and goals. Contracts. The present model permits any strategy to be compared with any other strategy. Licensing, Franchising, and Other Contractual Strategies. to a foreign partner in exchange for a continuous the firm allows another the right to use an specific products, as well as the rights to distribute. final ch 15 man3600. provides technical specifications to a subcontractor or local manufacturer. Footnote 3 We assume that the entering firm E and the domestic incumbent I have identical and constant marginal cost c if firm E uses the FDI strategy. True/False . Conclusion. International Business: The New Realities, 4e (Cavusgil) Chapter 15 Licensing, Franchising, and Other Contractual Strategies _____ 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. a. Licensing: An arrangement in which the owner of intellectual property. provides technical specifications to a subcontractor or local manufacturer. Terms in this set (7)Study with Quizlet and memorize flashcards containing terms like when it comes to getting involved in international business what are the three strategies that require the least amount of commitment and effort?, export assistance centers provide hands-on expiring assistance and trade-finance support for ____ and _____ -sized businesses. 2. Franchise Agreements are the core operating principles that define the relationship between the franchisor and the franchisee. 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. In licensing, the licensor has limited control over the operations of the licensee, whereas franchising involves extensive control and support provided by the franchisor. trademark. 1 International Entry Modes 7. Licensing, franchising and other contractual strategies. Typically include the exchange of intangibles and services. a. It reduces risks for both parties. E) adaptation for local. From a licensee standpoint, there are fewer risks in product development,. The main difference between the two is the duration of the commitment involved. c. Ch. 1. There are two major types of market entry modes: equity and non-equity. - Firms that use licensing often can avoid expensive entry as is usually required in FDI. It's also easier for the company to extricate itself from the situation if the results aren't favorable. pdf from ECON 102 at Warsaw School of Economics. The Franchiser requires the franchisee to make a minimum payment of $500 or more, and. Verified Answer for the question: [Solved] Which of the following is true about cross-border contractual relationship? A) It is a more visible strategy than FDI and draws a lot of criticism from the local market. Either way, the licensor gets a kickback—as a. 4. contract manufacturing. Match. Franchising. Cooperative strategies refer to any type of agreement between two or more firms, contractual or otherwise, involving mutual forbearance towards one or more (typically not identical) goals by providing capital, knowledge, technology, managerial talent, and/or other valuable assets under the purview of said firms (Anand & Khanna, 2000; Gulati, 1998). Payment is made only after you have completed your 1-on-1 session and are satisfied with your session. Licensing is a legal process in which one firm pays to use or distribute another firm's resources. Risk in franchising. They provide dynamic flexible choice View LICENSING from BUSINESS A M0804455 at Ain Shams University. Protecting Intellectual Property. View Test Prep - licensing and franchising from ECONOMICS 12 at Xavier Institute Of Management & Research. The costs of licensing and franchising vary widely depending on many factors. Cost of Licensing vs. 11 “Market Entry Options”). It. 1 International-Expansion Entry Modes. Franchising allows franchisors to function effectively with a much leaner organization. Get Quality Help. IBUS CH 15 Licensing, Franchising, and Other Contractual Strategies. b. franchising, wholly owned foreign subsidiaries b. , Licensing Agreement, Copyright Licensing and more. ,. Essentially, you need to decide whether you want to buy a franchise or own your own business while pursuing licensing opportunities. trading bloc c. Learn. Match. True Franchising is a variation of licensing strategy in which there is a contract between the parent company franchiser and a franchisee that allows the franchisee to operate a business developed by the franchiser in return for all rights for operations. Learn. Lisanslama, Franchising ve diğer Sözleşme Stratejileri Learn with flashcards, games, and more — for free. Default and termination 3. Total views 38. It is quite similar to the "franchise" operation. Management Contract 4. Meaning. Flashcards. Global Market Opportunity Assessment IV. • Describe. Unique aspects of contractual relationships. On the other hand, franchise agreements allow the use of trademarks, additional intellectual. 2. View BUS 417 . Licensing, Franchising, and Other. 2 Exporting 7. International Business: Strategy, Management, and the New RealitiesStudy with Quizlet and memorize flashcards containing terms like contractual entry strategies in IBUS, intellectual property, intellectual property rights and more. Week 12 Licensing, Franchising, and Other Contractual Strategies 1. 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. -most often begun with export. External: Operating Enviornment. 2. 1. The franchisee is. Match. 1-1 BUS 434 Market Entry Licensing, Franchising, and Other Contractual Strategies 1-2 Contractual Relationships • 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. A strategic alliance is a collaborative agreement between two or more companies to pursue mutually beneficial objectives. Franchising is a faster, cheaper form of expansion than adding company-owned stores, because it costs the parent company much less when new stores are owned and operated by a third party. Match. Licensing/franchising also opens the doors. 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. D) franchise contract involves less control and. Learn the basics of franchising and winning franchise growth strategies. 5 Explain the advantages and disadvantages of franchising. For example, Ranbaxy has licensing arrangement in countries like Indonesia and Jordan. Study with Quizlet and memorize flashcards containing terms like Build-operate-transfer (BOT), contractual entry strategies in international business, Intellectual Property and more. BUS MISC. Exporting falls within the broad umbrella of market entry strategies that include a range of approaches to build international markets for your business. 4 Understand franchising as an entry strategy. Franchising. Often regarded as second best to export or direct investment. Licensing. Study with Quizlet and memorize flashcards containing terms like contractual entry strategies in international business, intellectual property, intellectual property rights and more. in exchange for royalties, license fees, or some other form of compensation Patent Trade secret Brand name Product formulations. chesiebels. 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 (Table 7. Intellectual property rights (IPRs) legal claim through which the proprietary assets of firms and individuals are protected from unauthorized use by other parties, monopoly advantage for specified period of time. Franchising. Mode Characteristics Advantages Disadvantages. Which of the following is key to licensing strategy success? Avoidance of barriers for foreign companies doing business. If you think of a franchisor (the brand) as a. Arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties, or. Test. Flashcards. Typically, the franchise agreement is for ten years. Similar to a licensing agreement, under a franchising agreement, the multinational firm grants rights on its intangible property, like technology or a brand name, to a foreign company for a specified period of time and receives a royalty in return. Study with Quizlet and memorize flashcards containing terms like Contractual Entry Strategies in IB, Intellectual Property, Contractual Entry Strategies and more. 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. and industry leading guides that cover everything from francising principles to vorgeschritten franchise growth strategies. Chapter 16 - Licensing, Franchising and other Contractual Strategies. Contract duration and renewal 2. Major global. a. Intellectual Property rights – legal claims that protect proprietary assets of firms and indivduals from unauthorized use by other parties III. Difference between licensing and. 2. - advanced form of licensing where firm allows another the right to an entire business system in exchange for fees, royalties, other forms of compensation. In deciding which method to adopt, it is important that a firm evaluate each entry mode’s. focal firm does everything for business and hands it over to customer after training. Verified Answer for the question: [Solved] The reputation of a licensor will be jeopardized by a licensing agreement if the licensee _____. Click the card to flip 👆. governed by a contract that provides the focal firm with moderate level of control over the foreign partner 2. nontariff barrier d. Chapter 14 Licensing, Franchising, and other Contractual Strategies Opening: Harry Potter; The Magic of Licensing386 • Warner Brothers has exclusive licensing rights to the Potter series • Warner allows companies to use Potter realted images on manufactured products in exchange for royalty • Licensing process is self generating o Each new. University High School High School Regions. A franchise is a business model in which a business owner licenses their business to another individual or organization. The Franchiser maintains significant control of, or provides significant assistance to, the franchisee’s operation methods. A) franchise contract is more specific and usually longer in duration. Licensing, Franchising and other Contractual Strategies P a g e 1 | 10 P a g e 2 | 10 Executive Summary The report discusses international modes • Compared to licensing, franchising is usually a much more stable, long-term entry strategy. Franchising, on the other hand, is a business expansion model where a franchisor grants the rights. A licensing agreement is generally less complicated and easier to finalize than a franchise agreement. Licensing specifies the territory as well as period. Franchising makes up 10% of the U. export restraint b. reduce local perceptions of the focal firm as a foreign enterprise Study with Quizlet and memorize flashcards containing terms like 1. Several strategies for franchising in East. . Learn. True/False . 4. Licensing, Franchising and Other Contractual Entry Strategies - Chapter 15. B. . In addition to the standard license process, a company will assist in establishing the business with the design, equipment, organization, and marketing. S. intellectual property Ideas or works that individuals or firms create, including discoveries and inventions; artistic, musical, and literary works; and words, phrases, symbols, and designs. International Business: The New Realities, 4e (Cavusgil) Chapter 15 Licensing, Franchising, and Other Contractual Strategies _____ 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. Learn. The difference is that the franchiser provides a bundle of services and products to. 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. Licensing and Franchising. Establishing joint ventures with a host-country firm 6. In this chapter, you will learn about: Contractual entry strategies Licensing as an entry strategy Advantages and disadvantages of licensing Franchising as an entry strategy. Created by. Master Franchise. Terms in this set (12) Contractual entry strategies in international business. Licensing: Licensing offers several benefits for both the licensor and the licensee. Licensing is an arrangement by which the owner of intellectual property grants another firm the right to use that property for a specific time period in exchange for royalties or other compensation. Let’s take a look. Process. 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. Solved . 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. Special licensing arrangement; Contract between a parent company-franchisor and a franchisee that allows the franchisee to operate a business developed buy the franchisor in return for a fee and adherence to franchise-wide policies; Has great appeal to local entrepreneurs anxious to learn and apply Western-style marketing techniquesStudy with Quizlet and memorize flashcards containing terms like Starbucks' relentless pursuit of global market opportunities illustrates the fact that most firms face a broad range of strategy alternatives. Cavusgil, 3edition, Licensing Franchising and Other Contractual Strategies, Licensing, Franchising, Franchise, Chapter16. Match. 15. Unique Aspects of Contractual Relationships. Ask AI New. Learn. Unique aspects of contractual relationships They are governed by a contract that provides the focal firm with moderate level of control over the foreign. Low development cost and low risk in overseas expansion are advantages of this entry mode. Learn. ) Bringing ideas for business in other countries to new markets. Contractual entry strategies in international business are cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an explicit contract. Abstract. Advantages. Create flashcards for FREE and quiz yourself with an interactive flipper. An Industrial Design is Intended to _____ Question 2. docx from BUS MISC at Florida State University. The definition is important because franchises are covered by securities law while licenses are covered by contract law. 16: Licensing, Franchising, and Other Contractual Strategies Flashcards | Quizlet Ch. Brand owners lease their patents, software, or characters to other companies. 2. Study with Quizlet and memorize flashcards containing terms like What does a contractual entry strategy in IB mean, Give forms of IP, What are the types of contractual relationships and more. turnkey contracting. d. Franchising VS Licensing. Advantages and disadvantages of franchising. Key Challenges Faced by the Franchisee is the Decreased Likelihood. b. They generate a consistent, stable level of earnings from foreign operations. includes exchange of intangibles and services 3. licensee: In a licensing relationship, the buyer of the produce, service, brand or technology being licensed. View Overview. 15. These rights are usually protected by a patent or some other intellectual right. Market entry modes for international businesses. In the franchising packages trademarks, copyright, patents and other things often are included. CONTRACTUAL STRATEGIC ALLIANCES i. Internal: Operational. Chapter 15 Licensing, Franchising, and Other Contractual Strategies 1) _____ 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. Licensing is giving legal rights to in-market parties to use your company’s name and other intellectual property. Both licensing and franchising are really fantastic. Internal: Operational. c. Verified Answer for the question: [Solved] The reputation of a licensor will be jeopardized by a licensing agreement if the licensee _____. give later entrants a cost advantage over early entrants. External: Operating Enviornment. C)It restricts a firm's ability to expand more rapidly abroad. Fast entry, low risk. Flashcards; Learn; Test;Exporting. Setting up a new wholly owned subsidiary in the host country. The contractual arrangements ( CA ) mode of entry is in most cases a stepping stone to international production. Create flashcards for FREE and quiz yourself with an interactive flipper. Created by. Licensees can re-sell the IP at a higher price or manufacture merchandise with the IP on it. International Business Strategy, Management & the New Realities. Your matched tutor provides personalized help according to your question details. 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. Licensing is an arrangement by which the owner of intellectual property grants another firm the right to use that property for a specific time period in exchange for royalties or other compensation. Match. Build trust, build interpersonal relationships, get to know each other, build an informal network between the 2 firms managers. Test. Exporting is a low-risk strategy that businesses find attractive for several reasons. 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. Licensing is designed to reduce the risks involved in doing business for everyone involved. In this chapter, we address various types of cross-border contractual relationships, including licensing and franchising. cross-border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit. 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, and literary works; and words, phrases, symbols, and designs They are governed by a contract that provides the focal firm with moderate level of control over the foreign partner They typically include the exchange of intangibles and services Firms can pursue them independently or in conjunction with other entry strategies They provide dynamic, flexible choice They often reduce local perceptions of 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. c. Key challenges faced by the franchisee is the decreased likelihood of operating an independent business. 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. 99/year Quiz 15: 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. cross-border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit. The globalization of franchising took off in the 1990s as a result of push factors (domestic. 15.