These contractual methods can be seen in many forms such as international licensing and franchising. Franchisee: A franchisee is a small business owner that purchases the right to use an existing business's trademarks, associated brands, and other proprietary knowledge. Table 7. The nation lacks the skilled labor and technical know-how to handle such large-scale projects. real business leading guides that top everything from franchises basics to advanced vote growth strategies. cross-border exchanges in which relationship between the focal firm and its. Second, some firms find it less risky and more profitable to export. Multiple Choice . IB Final review 80% A- / 90% A Chapter 16 Licensing, Franchising, and Other Contractual Strategies o Intellectual Property (IP): refers to ideas or works created by individuals or firms, including discoveries and inventions; artistic, musical, and literary works, and words, phrases, symbols, and designs Creation from the mind Licensing licenses. . Another popular way to expand overseas is to sell franchises. Quiz 15: Licensing, Franchising, and Other Contractual Strategies. docx from INT- 113 at Southern New Hampshire University. They generate a consistent, stable level of earnings from foreign operations. Franchising is a contractual international market entry mode as a licensing agreement when an organization wants to enter a foreign market quickly with low risk and resource commitment. Cost of Licensing vs. and industry leading guides that cover everything from francising principles to vorgeschritten franchise growth strategies. they are governed by a contract that provides the focal firm with a moderate level of control over the foreign partner 2. What Are The Types of International Business. True. International Business Strategy, Management & the New Realities. When considering the three basic decisions a firm must make when it decides to enter a foreign market, it must determine the market. Franchising iii. Internal: Operational. contract manufacturing. The legal claim through which the proprietary assets of firms and individuals are protected from unauthorized use by other parties. Bashar Hassan. Subscribe to newsletters Subscribe: $29. Chapter 16 – Licensing, Franchising, and Other Contractual Strategies I. ) Bringing ideas for business in other countries to new markets. Exporting 2. The organization that obtains the access is the licensee. B) It ensures payment from the licensee to the licensor upon receipt of an export shipment. Production of certain components like automobile components to be used for producing. The main reasons companies form strategic alliances are to gain access. at completion of the contract, the foreign client is handed the "key. 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. Flashcards. Posted by Rully Mangunsong at 10:16 AM. Licensing is a type of market entry whereby a company in one country transfers the right of a company in another country to use its unique production processes, patents, trademarks, technological achievements, and other valuable skills for a fee that is established under the contract. Licensing is designed to reduce the risks involved in doing business for everyone involved. 2. 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. When a firm allows others to use an entire business system in exchange for compensation, the arrangement is known as ________. e. They often. trademark. Studying is made a lot easier and more fun with our online flashcards. A licensing is an agreement whereby a licensor grants the rights to intangible property (patents, inventions, formulas, processes, designs, copyrights, and trademarks) to another entity (licensee) for a specified period and in return, the licensor receives a royalty/fee from the licensee. Arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties, or. Brand licensing is the act of giving permission to another company to use your business’s intellectual property (IP). e. Patent licensing is a licensing that a licensor gives to the licensee to grant permission to conduct patent activities. Licensing of IPRs is at the heart of a franchise contract. 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. Read other and watch their success stories!. A licensing agreement allows a foreign company to sell a company’s. provides technical specifications to a subcontractor or local manufacturer. Can be pursued independently or in conjunction with other entry strategies. 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. 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. (2004) differ between ownership-bas ed entry modes (OBEs) and contract based modes (CBMs). Multiple Choice . A number of foreign market entry modes exist, including: exporting, licensing, franchising, joint venture and wholly owned subsidiary. focal firm does everything for business and hands it over to customer after training. - As entry strategy, licensing requires neither substantial capital investment nor extensive involvement of licensor in foreign markets. 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. • Contractual entry strategies (franchising, licensing, management. b. Patent licensing is one of the most expensive licensing. Solved . They typically include the exchange of intangibles and services. CHAPTER 15 LICENSING FRANCHISING AND. Verified Answer for the question: [Solved] Which of the following is an example of licensing? A) An American electronics firm has given the right to a new process for manufacturing e-book readers to an electronics manufacturer in Canada. 1. Governed by a contract that provides the focal firm with a moderate level of control over the foreign partner. ability to preempt rivals and capture demand by establishing a strong brand name. 3. Expert Help. distributing or retailing products that are traditionally manufactured by the franchisor. Study with Quizlet and memorize flashcards containing terms like T/F Licensing 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. Match. Homework Help. Describes the appearance or features of a product. Licensing 2. Global Strategy and Organization; 12. Licensing specifies the territory as well as period. A franchise agreement is a contract between the business owner (franchisor) and the franchisee. Flashcards. nontariff barrier d. other contractual agreements and equity modes (wholly owned subsidiary or joint venture). b. 2. Create flashcards for FREE and quiz yourself with an interactive flipper. Stage Three: Specify a specific format that is either equity based or contractual (nonequity based). For courses in international business. Each entry mode has different pros and cons, addressing issues like cost, control, speed to market, legal barriers, and cultural barriers with different degrees of efficiency. External: Operating Enviornment. 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. Contractual entry strategies in international business Click the card to flip 👆 cross-border exchanges in which relationship between the focal firm and its foreign partner is governed by an explicit contract Licensing, Franchising and other Contractual Strategies International Business Strategy, Management. 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. In addition to the standard license process, a company will assist in establishing the business with the design, equipment, organization, and marketing. 15. a. What are Franchising? Franchising is an business agreement that includes the license is a trademark, of payment of a fee, and control over how the underlying franchises business has operated. FDI in particular is now carried out not only by traditional MNEs but also by private investors, hedge funds, SOEs and even sovereign wealth funds. Multiple Choice . Most Business document from University of British Columbia, 26 pages, BUS 434 Market Entry Licensing, Franchising, and Other Contractual Strategies 1-1 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 • Understand other contractual entry strategies. Direct strategies include joint ventures and wholly-owned subsidiaries/ greenfield investments (see Table 2). the positive or negative perception of firms and products from a certain country. D)It is typically characterized as an unstable, short-term entry. Fast entry, low risk. One could say that franchising is a special type of licensing arrangement inContractual Entry Modes A company can use a variety of contracts such as : licensing, franchising, management contracts, and turnkey projects to market highly specialized assets and skills in markets beyond its nation’s border. 15. Introduction to International Business Study Guide Exam 3 – Part 1 Chapter 16: Licensing, Franchising and other Contractual Strategies • What does licensing refer to? 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. Flashcards. Learn. Two Types of Contractual Relationships. 5 Explain the advantages and disadvantages of franchising. Two common types of contractual entry strategies are licensing and franchising. Securities law govern. 6 Understand other contractual entry strategies. Licensing, Franchising, and Other Contractual Strategies Internal: strategic Register IP target country chain1. ,. 2 Understand licensing as an entry strategy. 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. Switzerland is a country that has revaluated its currency—this does not happen often. Ask AI New. 3 Describe the advantages and disadvantages of licensing. The International Franchise Association defines franchising as a "continuing relationship in which the franchisor provides a licensed privilege to do business, plus assistance in organizing training, merchandising and management in return for a consideration from the franchisee ". Microfranchises: Franchises operated by one or two people. C) The licensee cannot cancel the contract with the. 99/year Quiz 15: Licensing, Franchising, and Other Contractual Strategies. industry are franchising and management-service contracts (MSC). Flashcards. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features NFL Sunday Ticket. Match. They typically include the exchange of intangibles. 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. Which of the following is key to licensing strategy success? Avoidance of barriers for foreign companies doing business. Study with Quizlet. 11). Human Resource Management. 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. 4 Understand franchising as an entry strategy. How Aristotle can help: the philosophy of business If your company is ever going to implement a successful licensing strategy, the corporate licensing team had better take to heart the wisdom of Aristotle. 1. Quizlet flashcards, activities and games help you improve your grades. Typically include the exchange of intangibles and services. Study Licensing, franchising and other contractual strategies (Key Terms) flashcards from Lewis Mellor's class online, or in Brainscape's iPhone or Android app. S. Management Service Contracts A management service contract is a long-term agreement, of up to ten years or even longer, whereby the legal owners of the property and real estate enter into a. B) franchise contract must include a foreign government. 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. Typically include the exchange of intangibles and services. The license agreement permits the use of trademarks, nothing more. It is unusual to see a direct comparison between, say, licensing and joint ventures, or between franchising and subcontracting. What Are The Types of International Business. Exporting is a low-risk strategy that businesses find attractive for several reasons. Flashcards. Strategy and Organization in the International Firm 316 12. 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. A. Master Franchise. includes exchange of intangibles and services 3. 1. A number of foreign market entry modes exist, including: exporting, licensing, franchising, joint venture and wholly owned subsidiary. Match. with direct or area franchise forms of licensing (P2a). Expert Help. 25 “Market entry options”). In deciding which method to adopt, it is important that a firm evaluate each entry mode’s. Intellectual Property rights – legal claims that protect proprietary assets of firms and indivduals from unauthorized use by other parties III. View final ch 15 man3600. The franchisee is. cross border interaction between focal firm and foreign firm governed by a contract. 16: Licensing, Franchising, and Other Contractual Strategies unique aspects of. The most use contractual entry modes are Licensing, Franchising and Turnkey projects which is going to be explained below. Franchising 5. 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). Low control, low local knowledge, potential negative environmental impact of transportation. OTHER STRATEGIC ALLIANCES i. Licensing typically involves royalties or. Ask AI New. b. This part concerns the sale of knowledge rather than the sale of goods—licensing, franchising, management contracts and other similar arrangements. entered China by giving a retail chain in China the authority to use Saks Fifth Avenue name for a flagship department store in Shanghai. The licensor provides no technical support or assistance in most cases. Start studying Ch. • Understand infringement of intellectual property Foundation Concepts • Contractual entry strategies in international business: Cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an explicit contract. Verified Answer for the question: [Solved] The reputation of a licensor will be jeopardized by a licensing agreement if the licensee _____. thecashchicken. 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. By entering your email, you agree to receive marketing emails from Shopify. Match. However, they enjoy a lot more freedom than franchisees. View LICENSING from BUSINESS A M0804455 at Ain Shams University. Test. Test. destineeashlee. contractor supplies managerial know how. Typically, the franchise agreement is for ten years. As a disclosure, my company is a franchise providing. Foreign. - advanced form of licensing where firm allows another the right to an entire business system in exchange for fees, royalties, other forms of compensation. Setting up a new wholly owned subsidiary in the host country. 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. . Payment is made only after you have completed your 1-on-1 session and are satisfied with your session. CONTRACTUAL ENTRY STRATEGIES Two common types of contractual entry strategies are licensing and franchising. The specific definition of the license. Licensing, Franchising and other Contractual Strategies. Terms in this set (21) Contractual entry strategies in international business. Licensing is governed by a licensing agreement, which involves a one-time transfer of property or rights for a fee. Importing involves purchasing products from other countries and reselling them in one’s own. 4. Focal firm has moderate level of control over the foreign partner. Click the card to flip 👆. 4 Understand franchising as an entry strategy. economic output and, depending on your needs, goals and circumstances, may be the right choice for you. [2] defined market entry as "a planned move into a new or adjacent market for the creation and delivery of offerings. Question 14. Created by. caitlyn_stryker. Choose from 29 different sets of Licensing, Franchising and other contractual strategies flashcards on Quizlet. The problems facing franchise companies in international transactions are relatively less formidable than those facing other service sectors. -resource commitment. late. management contracts. 2. Franchising makes up 10% of the U. A strategic alliance is a collaborative agreement between two or more companies to pursue mutually beneficial objectives. Disney originally forecast shelling out a little more than $30 billion on content (including sports rights) in fiscal 2023, which ended Sept. Licensing involves granting rights to use intellectual property, while franchising grants rights to use an entire business model. Internal: Strategic. Licensing,. Learn faster. 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 subsidiaryChapter 6: Strategic Alliances. Learn the differences between licensing and franchising and why licensing is not an optional to franchising. U. 1Explain contractual entry strategies. arrangement in which the owner of intellectual property grants another firm the right to use that property for a specified. View Homework Help - Week 4 - Subway Case. International Business: The New Realities, 5e (Cavusgil) Chapter 15 Licensing, Franchising, and Other Contractual Strategies 1) A _____ 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. 4. 3. Unique Aspects of Contractual Relationships. 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. Strategic Management Chapter 7. Disadvantages. licensee: In a licensing relationship, the buyer of the produce, service, brand or technology being licensed. cross-border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit. Zhao et al. Staffing leverage . ) The many technological barriers to doing business globally. Similar to a licensing agreement, under a franchising Granting rights on an intangible property, like technology or a brand name, to a foreign company for a specified period of time and receiving a royalty in return. Learn. 16 Licensing, Franchising, and Other Contractual Strategies. export restraint b. 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. A. A) joint ventures B) licensing C) 100-percent ownership D) exporting E) franchising, 2) For Walt Disney. Created by. An industrial design is intended to _____. Some companies use direct exporting, in which they sell the product they manufacture in international markets without third-party. Essentially, you need to decide whether you want to buy a franchise or own your own business while pursuing licensing opportunities. International Business: The New Realities, 5th Edition caters to a post-millennial student audience, the most diverse and educated generation to date. Chapter 15 Licensing, Franchising and other Contractual Strategies Internatonal Business: Other mark ups and contributions like finance charges, sale of related products etc. 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. A franchise is a business model in which a business owner licenses their business to another individual or organization. 15. 15. Revenues are usually more modest than with other entry strategies. Multiple Choice . , Licensing Agreement, Copyright Licensing and more. 5 Contract Manufacturing 7. Representatives of the Azoo government are reviewing the project bids. Franchising. B) An Indian automobile manufacturing company buys engines from a Japanese manufacturer for its. WEEK 12 - LICENSING, FRANCHISING AND OTHER CONTRACTUAL STRATEGIES. If you want to have more autonomy in business decisions with the freedom to make your own vision come to life. RenaeBoleyn. Franchising and licensing both offer business opportunities with some of the work already done for you, but that doesn't mean they're exactly the same. International Business: The New Realities, 4e (Cavusgil) Chapter 15 Licensing, Franchising, and Other Contractual Strategies 1) _d. , T/F Organizations as diverse as Disney, Caterpillar,. Merger and Acquisition ii. As a rule, licensing strategies inhibit control and produce only moderate returns. Study Chapter 16 - Licensing, Franchising and other Contractual Strategies flashcards from Tia-Jane Maggs's class online, or in Brainscape's iPhone or Android app. 3. 11 “Market Entry Options”). Learn. 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. Discover. Question 14. License 101 Where lives Entering?. Try it free3. Firms can pursue them independently or in conjunction with other entry strategies. pdf from BUST 08009 at University of Edinburgh. Licensing, Franchising and. 3. Any licensee can produce and sell products under your name or offer services using your brand. Process. Product Invention. 4. Studying is made a lot easier and more fun with our online flashcards. A modern approach to international business. The Franchiser requires the franchisee to make a minimum payment of $500 or more, and. Licensing: An arrangement in which the owner of intellectual property. Firms need to evaluate their options to choose the entry mode that best suits their strategy and goals. Global Market Opportunity Assessment • Estimating Demand in Emerging Markets • Global Macro Trends that Affect International Business Licensing, Franchising, and Other Contractual Strategies: Contractual Entry Strategies Licensing as an entry strategy advantages and disadvantages of licensing Franchising as an entry strategy Other. Contract usually runs five to seven years and is renewable at option of parties. b. Franchising is common in manufacturing industries while licensing is primarily used in service industries. Entering. " Early market entry is generally considered a competitive. Licensees also enjoy lowered risk because they're usually entering the marketplace with a known quantity and a built-in customer base. 15 Licensing, Franchising and Other Contractual Strategies. in exchange for royalties, license fees, or some other form of compensation Patent Trade secret Brand name Product formulations. Chapter 15. Licensing ii. It can be classified into three major forms-. 6 billion in revenues. Aspect Franchising Licensing; Definition: Franchising is a business model where a franchisor grants a franchisee the right to operate a business using the franchisor’s brand, systems, and support in exchange for fees and royalties. Learn. 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. give later entrants a cost advantage over early entrants. Contractual Entry Strategies. Several strategies for franchising in East. Created by. Test. Exporting is a method of expansion where. focal firm does everything for business and hands it over to customer after training. 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. c. Franchising. Major global. 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 is a contractual arrangement where a company grants permission to another party to use its intellectual property or brand. Find Flashcards. make it easy for later entrants to win business. 15. Licensing & Franchising The major drawback of licensing is the problem of controlling the licensee due to the absence of direct commitment from the international firm granting the licence. Licensing is an arrangement by which the owner of intellectual property grants another. Learn. 1 Licensing. , Contractual alliances include all of the following except: a. Contract Manufacturing: - This entry mode is a cross between licensing and investment entry. Change Message. Learn faster with spaced repetition. 6 Joint Ventures Chapter 8. licensing team. Contractual Entry Strategies Contractual entry strategies Two common types of contractual entry strategies are licensing andLicensing. Often regarded as second best to export or direct investment. The Franchiser maintains significant control of, or provides significant assistance to, the franchisee’s operation methods. 4 ways to enter foreign markets. The costs of licensing and franchising vary widely depending on many factors.