Its goal. Production of certain components like automobile components to be used for producing. 2 Understand licensing as an entry strategy. destineeashlee. intellectual property. 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. What is Licensing and Franchising? Licensing is a contractual agreement in which one company provides another company in foreign country access to its patents, trade secrets, or technology in exchange for a fee known as a royalty. But the Mouse’s actual 2023 number. When considering a venture in international markets, there are some significant tactical and strategic decisions to be effected. Financing is more costly in other countries. turnkey contracting. 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. 1. Quiz 15: Licensing, Franchising, and Other Contractual Strategies. 4 illustrates the nature of the franchising agreement A typical. View LICENSING from BUSINESS A M0804455 at Ain Shams University. In licensing, the licensor has limited control over the operations of the licensee, whereas franchising involves extensive control and support provided by the franchisor. Licensing, franchising and other contractual strategies. The present model permits any strategy to be compared with any other strategy. Abstract. Direct exporting. Exporting, joint ventures, direct investment, licensing, franchising, and other forms of an alliance is duly considered as market entry types. Product Invention. Franchising. when the factors that contributed to domestic success are transferable to foreign locations. 15. Licensees can re-sell the IP at a higher price or manufacture merchandise with the IP on it. Some companies use direct exporting, in which they sell the product they manufacture in international markets without third-party. Lisanslama, Franchising ve diğer Sözleşme Stratejileri Learn with flashcards, games, and more — for free. 6. For international trade, Foreign market entry modes are the ways in which a company can expand its services into a non-domestic market. One of the key differences between a franchise and a license is the limitation set out in licensing agreements. It is quite similar to the "franchise" operation. and popular strategies for business expansion. B) It ensures payment from the licensee to the licensor upon receipt of an export shipment. Licensing concerns a product rights or the method of production marketing the product rights. ) Finding financing for a new business in other countries. Chapter 15: Licensing, Franchising, and Other Contractual Strategies Key Elements Contractual Entry strategies in 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. S. Test. Licensing is a legal process in which one firm pays to use or distribute another firm's resources. Global Market Opportunity Assessment IV. 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. Brooke MA, PhD, FIEx & Peter J. dynamic, flexible choices 5. Strategic alliances can take many different forms, such as joint ventures, licensing agreements, and marketing alliances. On the other hand, international licensing is a foreign market entry mode that presents some. Franchising. Management Contract 4. licensing team. they typically include the exchange of intangibles and services 3. arrangement in which the focal firm or a consortium of firms plans, finance, organizes, manages. Patent licensing is one of the most expensive licensing. Two Types of Contractual Relationships. Licensing, Franchising, and Other Contractual Strategies Internal: strategic Register IP target country chain1. Franchising is governed. Leasing is Especially Beneficial to _____ Question 80. When considering entering international markets, there are some significant strategic and tactical decisions to be made. The Five Common International-Expansion Entry Modes. . 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. Study Licensing, franchising and other contractual strategies (Key Terms) flashcards from Lewis Mellor's class online, or in Brainscape's iPhone or Android app. 3. Key Challenges Faced by the Franchisee is the Decreased Likelihood. Two common types of contractual entry strategies are licensing and franchising. Browse With TopicA licensing agreement is a contract between two parties (the licensor and licensee) in which the licensor grants the licensee the right to use the brand name, trademark, patented technology, or ability to produce and sell goods owned by the licensor. Equity relations allow firms to have some direct control, while contractual does not. 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,. Quiz 15: Licensing, Franchising, and Other Contractual Strategies. 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. Week 12 Licensing, Franchising, and Other Contractual Strategies 1. Expert Help. entered China by giving a retail chain in China the authority to use Saks Fifth Avenue name for a flagship department store in Shanghai. 3. chapter 16 licensing, franchising, and other contractual contractual entry strategies in international business: exchanges where the relationship between the. 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". Study with Quizlet and memorize flashcards containing terms like Contractual entry strategies in international business, Intellectual property, Intellectual property rights and more. the firm enters a foreign market before other foreign firms - this is a proactive strategy. Markman et al. True/False . Flashcards. A) joint ventures B) licensing C) 100-percent ownership D) exporting E) franchising, 2) For Walt Disney. Recent advances in digitalization and increasing integration of international markets are paving the way for a new generation of firms to use non-traditional entry modes that are largely marginalized in previous entry mode studies. d. 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. patent. Direct exporters often sell directly to a consumer (B2C), a business (B2B), or a distributor in a foreign country. D) strategic decision making. embargo, In the context of various strategies for reaching global markets, which of the following strategies. Marketing in the Global Firm 464 17. 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. On the other hand, franchise agreements allow the use of trademarks, additional intellectual. Flashcards. The organization that obtains the access is the licensee. 4. 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. 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. A patent exclusively refers to a distinctive design, symbol, logo, word, or series of words placed on a product label. 15. firms with industries, markets, and customs in other countries. Multiple Choice . Solved . Because first mover advantage has been shown to result in better performance in emerging markets Marinov and Marinova 1999, Luo and Peng 1998, a firm may chose licensing as an expeditious entry strategy to gain the first mover advantage and create barriers for subsequent entrants. Learn. [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. In franchising, the franchisor licenses the. Disadvantages. Exporting. Franchising only deals with the provision of a service, while licensing can be for both services and products. Global Strategy and Organization; 12. The problems facing franchise companies in international transactions are relatively less formidable than those facing other service sectors. The licensee/franchisee gets immediate brand recognition and may quickly overtake the competition by offering a product or service for which there is existing unmet demand. Verified Answer for the question: [Solved] Before undertaking contractual entry strategies abroad, management _____. Studying is made a lot easier and more fun with our online flashcards. world markets • Starbucks has used direct ownership, licensing, and franchising for shops and products In 2008, Starbucks had 12,000 cafes in 35 countries and sales of $10. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy & Safety How YouTube works Test new features NFL Sunday Ticket Press Copyright. Indirect strategies are indirect/direct exporting, licensing, franchising and contractual agreements (see Table 2). Microfranchises: Franchises operated by one or two people. A franchised. 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. Match. 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. 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. 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. Disadvantages of licensing. Licensing, Franchising, and Other Contractual Strategies 438 Part 5 Functional Area Excellence 464 16. Study with Quizlet and memorize flashcards containing terms like Inbound licenses, Outbound licensing, Contractual entry strategies in international business and more. Ensuring ongoing competitive advantage. D)It is typically characterized as an unstable, short-term entry. When a business enters a foreign market after other foreign firms, the situation is defined as ______ entry. Question 14. Licensing is expensive and it requires process like agreement & It is similar as Franchise Operation. *Granting a right to use property to others. Licensing and franchising share a few similar advantages. In franchise, a franchiser sells a property to the franchisee but controls over the procedures of the business. 1 International-Expansion Entry Modes. Provide dynamic, flexible choice. 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. Study with Quizlet and memorize flashcards containing terms like 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. cavusgil ib im 15 - CHAPTER 15 LICENSING FRANCHISING AND OTHER CONTRACTUAL STRATEGIES DETAILED CHAPTER OUTLINE INTRODUCTION The opening vignette is. If you think of a franchisor (the brand) as a. 15- Licensing, Franchising and other. Buckley BA (Econ), MA, Phd Chapter 90 Accesses Abstract This. In addition to paying an. Strategies: Licensing, Investment, and Strategic. It can be classified into three major forms-. Licensees also enjoy lowered risk because they're usually entering the marketplace with a known quantity and a built-in customer base. Licensing. Two Types of Contractual Relationships. Test. Many firms build biotech tags,. Chapter 16- Licensing, Franchising, and Other Contractual Strategies Flashcards | Quizlet Chapter 16- Licensing, Franchising, and Other Contractual Strategies 5. Learn faster with spaced repetition. When the executives in charge of a firm decide to enter a new country, they must decide how to enter the country. In the franchising packages trademarks, copyright, patents and other things often are included. agreement, the multinational firm grants rights on its intangible property, like technology or a brand name, to a. Study with Quizlet and memorize flashcards containing terms like Contractual entry strategies in international business, intellectual property, intellectual property rights and more. Moderate-Control Strategies (Licensing, Franchising and other Contractual Strategies, Project Based (non-equity) collaborative ventures) "Moderate": -control available to the focal firm over foreign operations. One of the key differences between a franchise and a license is the limitation set out in licensing agreements. True/False . Ask AI New. A) Duty B) Residual C) Royalty D) Tariff Answer: CLicensing 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. contractual agreements. Learn vocabulary, terms, and more with flashcards, games, and other study tools. 4. Licensing gives a company greater control than franchising over the sale of its product in a target market. cross-border exchanges where the relationship between the focal firm and its foreign partner is governed by an explicit. ,. Learn. Find Flashcards. Study with Quizlet and memorize flashcards containing terms like contractual entry strategies in international business, intellectual property, intellectual property rights and more. B) The franchisor holds much power, including superior bargaining power. 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. Contractual Entry Modes 3. 6. With franchising, a foreign company essentially sets up a replica of the franchiser’s business, paying royalties and other fees to use its intellectual property, brand, and business model. An Introduction A. 99/year Quiz 15: Licensing, Franchising, and Other Contractual Strategies. Internal: Strategic. Product Adaption. When a firm allows others to use an entire business system in exchange for compensation, the arrangement is known as ________. 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. 1. Licensing/franchising also opens the doors. Ask AI New. 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. Partnering, licensing, franchising, joint venture creation, business acquisition, and Greenfield ventures represent the spectrum of market entry opportunities. licensee: In a licensing relationship, the buyer of the produce, service, brand or technology being licensed. In a very real sense, a licensor and licensee are entering into “a partnership for living well”, ie, the licence willVerified Answer for the question: [Solved] Which of the following is an example of licensing? A) Saks Inc. Organising for the Strategy. In a build operate transfer agreement how does the business that built the facility ensure that they profit from the agreement?, Test Your Comprehension, 15-9. B)It is an ownership-based international business activity. 82. 2. Licensing is a contractual arrangement where a company grants permission to another party to use its intellectual property or brand. CONTRACTUAL STRATEGIC ALLIANCES i. Flashcards. On the most basic level, the difference between a franchise and a license is the amount of support you can expect to receive. In 1974 the company started franchising in the USA and later it was uses in order to expand globally. Licensing. e. In turnkey contracting, one or several firms plan, finance, organize, and. Study with Quizlet and memorize flashcards containing terms like Contractual entry strategies in international business, intellectual property, intellectual property rights and more. 6 Understand other contractual entry strategies. Learn the differences between licensing and franchising and why licensing is not an optional to franchising. Major global. 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. Contract manufacturing is also called outsourcing. Study with Quizlet and memorize flashcards containing terms like Test Your Comprehension, 15-8. Test. Less control, licensee may become a competitor, legal and regulatory environment (IP and contract law) must be sound: Partnering and Strategic Alliance: Shared costs reduce investment needed, reduced risk, seen as local entity: Higher cost than exporting, licensing, or franchising; integration problems between two corporate. They generate a consistent, stable level of earnings from foreign operations. The license agreement permits the use of trademarks, nothing more. caitlyn_stryker. 6 Joint Ventures Chapter 8. Direct strategies include joint ventures and wholly-owned subsidiaries/ greenfield investments (see Table 2). View BUS 417 . If you want to have more autonomy in business decisions with the freedom to make your own vision come to life. Table 7. ( Multiple Choice) Question 2. Learn. Exporting is a method of expansion where. Table 7. The license has much stricter restrictions than the franchise. Match. : Licensing is a contractual agreement in which a licensor grants a licensee the right to use its intellectual property,. Study with Quizlet and memorize flashcards containing terms like Contractual Entry Strategies in IB, Intellectual Property, Contractual Entry Strategies and more. Study Licensing, franchising and other contractual strategies (Key Terms) flashcards from Lewis Mellor's class online, or in Brainscape's iPhone or Android app. 3 Describe the advantages and disadvantages of licensing. Process. Create flashcards for FREE and quiz yourself with an interactive flipper. Franchising. e. 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. Turnkey contracting. They are governed by a contract that provides the focal firm a moderate level of control over the foreign partner. Franchising VS Licensing. 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. Verified Answer for the question: [Solved] Which of the following is TRUE about cross-border contractual relationships? A) It is a more visible strategy than FDI and draws a lot of criticism from the local market. (Video) Market Entry Strategies: Contractual Market Entry ModesLess control, licensee may become a competitor, legal and regulatory environment (IP and contract law) must be sound: Partnering and Strategic Alliance: Shared costs reduce investment needed, reduced risk, seen as local entity: Higher cost than exporting, licensing, or franchising; integration problems between two corporate. View Chapter 16 & 17 MAN 3600 from MAN 3600 at Florida State University. c. The license has much stricter restrictions than the franchise. Mode Characteristics Advantages Disadvantages. In this section, we will explore the traditional international-expansion entry modes. Contractual Entry Strategies. The license agreement permits the use of trademarks, nothing more. Protecting Intellectual Property. Importing involves purchasing products from other countries and reselling them in one’s own. International Business Strategy, Management & the New Realities. make it difficult for later entrants to win business. 15. Exporting and foreign direct investing are two common types of contractual entry strategies. 2. 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. Verified Answer for the question: [Solved] Which of the following challenges is applicable to the franchisee in a franchising agreement? A) The franchisee must make their own arrangements to acquire initial training and know-how. cross-border exchanges in which the relationship between the focal firm & its foreign partner is governed by an. gives an inventor the right to prevent others from using or selling an invention for a fixed period-typically up to 20 years. Get Quality Help. Merger and Acquisition ii. licensing is the limitation placed on licensing agreements. Essentially, you need to decide whether you want to buy a franchise or own your own business while pursuing licensing opportunities. 25 “Market entry options”). trading bloc c. chapter 16 licensing, franchising, and other contractual contractual entry strategies in international business: exchanges where the relationship between the. Multiple Choice . 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. 15. 3Describe the advantages and disadvantages of licensing. 15. Learn. These contractual methods can be seen in many forms such as international licensing and franchising. , licensing and franchising) have lower up-front costs than investment modes do. 15 ~ Licensing, Franchising, and Other Contractual Strategies. The contractual arrangements ( CA ) mode of entry is in most cases a stepping stone to international production. 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. Match. D. In other words, a licensing agreement grants the licensee the ability to use intellectual. According to Franchise Business Review, franchising fees typically range from $25,000-$50,000 on average. 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 royalties or other compensation. -risk. The agreement so creates a franchise relationship is the franchise agreement and aforementioned parties to a franchise agreement are the franchisor and to french. 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. trademark. Solved . But, the organization has little control over technology and marketing. 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. Mode Characteristics Advantages Disadvantages. In order to prevent a licensor-competitor from gaining unilateral benefit, licensing agreements should provide for: A) contract manufacturing. Licensing involves granting rights to use intellectual property, while franchising grants rights to use an entire business model. Dispute settlement 4. Flashcards. The five most common methods include exporting, licensing and franchising, partnering and strategic alliance, acquisition, and Greenfield venture. A) duty B). Country Comparatives Guides. For example, a restaurant or a salon can be franchised, but not the products they use to provide the said services. Log in Join. The main difference between the two is the duration of the commitment involved. Find Flashcards. 2. 2 ABSTRACT Presently, companies wanting to engage in international trade have a wide pool of choices to choose from. Either way, the licensor gets a kickback—as a. b. Created by. C) A local firm allows the focal firm to blend into the local market, attracting less. 25 “Market entry options”). 1. 0 (1. , licensing and franchising) have lower up-front costs than investment modes do. d. 15. Advantages. 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). Zhao et al. While deciding between franchising vs. Learn from your partner (and apply that knowledge within your organization) Study Chapter 5: Entry into Foreign Markets flashcards. On the other hand, franchising is a business model whereby a company (franchisor) allows another company (franchisee) to use its. Match. actively manage a foreign. View Test Prep - licensing and franchising from ECONOMICS 12 at Xavier Institute Of Management & Research. Test. Business format franchising accounts for most of the explosive growth in franchising that has occurred in the past five decades. With the export strategy the marginal cost of firm E is higher due to. Cost of Licensing vs. trading bloc c. 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. economic output and, depending on your needs, goals and circumstances, may be the right choice for you. The most use contractual entry modes are Licensing, Franchising and Turnkey projects which is going to be explained below. late. Two common types of contractual entry strategies are licensing and franchising. View Test Prep - licensing and franchising from ECONOMICS 12 at Xavier Institute Of Management & Research. other contractual agreements and equity modes (wholly owned subsidiary or joint venture). RenaeBoleyn. - includes exchange of intangibles and services. Question 74. Two Types of Contractual Entry 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 compensation • Franchising: An arrangement in which the firm allows another the right to use an entire business system. They provide dynamic, flexible choice. 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. thecashchicken. -flexibility. 5. 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. Learn. 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. licensing. 11). Unique Aspects of Contractual Relationships. 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. Solved . Can be pursued independently or in conjunction with other entry strategies. Licensing is designed to reduce the risks involved in doing business for everyone involved. What are unique aspect of contractual relationship (5) 1. focal firm does everything for business and hands it over to customer after training. 1. Detailed contracts and ongoing monitoring are equally as essential to the success of this international business strategy. 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. B) They are more susceptible to volatility and risk compared to FDI. Flashcards.