Three main characteristicsThree main characteristics

LICENSING

* ROYALTIES * SHORT – MEDIUM TERM * PARTIAL TRANSFERENCE

FRANCHISING

* ROYALTIES * MEDIUM – LONG TERM * TOTAL TRANSFERENCE

In franchising, the franchisee and the franchisor are very closely linked and have better working relationships

The franchisee gets to retain the rights to the franchisor’s logo and trademark

 in franchising ,they are usually provided some level of training and support

 Also, they get to leverage some amount of territorial exclusivity in addition to control over the products and services offered.

The relationship between a licensee and the parent company is not as tight-knit as a Licensee franchisor relationship

 a licensee does not hold the rights to the trademark and logo of the parent company’s brand

 Also, the licensee is expected to create its own niche and identity in the market.

Another key difference is in the fact that licensees do not get to have territorial rights from the parent company

TURNKEY PROJECTS

An agreement in which a contractor designs,

constructs, and manages a project until it is ready to be handed over to the client and operation can

begin immediately.

DIFFERENCES BETWEEN TURNKEY PROJECTS AND MANAGEMENT SERVICE CONTRACT

* Turnkey projects – improvements or build infrastructures. not involved in the company’s management

* Management service contract – it is involved in the company’s management. using the infrastructure or managing the business idea.

STRATEGIC ALLIANCES

• They are collaborative arrangements that a company makes with competitors, suppliers, customers, distributors, or firms in the same or different industries.

• They are also formed to obtain technology, minimize environmental risks, or gain key human and material resources.

• Companies cooperate on a mutual need and share risks on order to achieve a common goal.

• Globalization• Risk sharing• Innovation and learning

• PENETRATING NEW FOREIGN MARKETS

• SHARING MARKETING COSTS

• POOLING GLOBAL RESOURCES

• LEARNING FROM PARTNERS

• Strategic alliances are made to make a stronger presence in the market, to have diversification among countries and to eliminate the competitive differences among the other companies.

• Joint ventures is a company formed by two companies, create a new market or satisfied an existing one; create new products

The transnationality of a company is the degree to which the company is linked and is participating in different countries.

True or false?True or false?

You’re worried because you’re the “Camel” export manager and you just have one international market with one product, but in a future, you want to get into new markets. What type of organizational structure has been the company using?a. Pre-internationalb. Internationalc. Globald. Multidimensionale. any of the above

The company has penetrated some new markets in various regions of the world at the same time. The company is working in different markets that are very dissimilar and some of those countries have both, high tariffs and quotas because their governments are encouraging local production. Therefore “Camel” opened production facilities in those countries. The subsidiaries are quite polycentric and decentralized that´s why there is a clear division between domestic and international operations.  8. According to “Camel” objective, which is the most appropriate type of control for it?a. Output and behaviorb. Inputc. Output and inputd. Behaviore. Output

Bikes Mountain has observed that the company has significantly decreased the demand for its product last year. This was caused by many incomplete orders and uncountable unpleasant customers. The president of the company met with their managers in which they discussed the problems that have been occurring lately and made a decision:

1.Modernizing and increasing the number of machines2.Remodeling the infrastructure.

For those reasons, the company hired a foreign company which will be responsible for the adequacy of the existing infrastructure and for the new machines installation. The agreement is for six months and the hired company is responsible for bringing the equipment and people required for carrying out the project without becoming involved in administrative activities of the company.

a. JOINT VENTURESb. COUNTERTRADEc. EXPORTINGd. STRATEGIC ALLIANCESe. NONE OF THE ABOVEf. ALL OF THE ABOVE

If the manager is considering supervising the company is on track, to analyze whether the company is getting close to achieve the objectives. What step of the managerial process does he need to apply?

a. Comparing performance to planb. Setting standardsc. Correcting deviationsd. Behavior Controle. None of the above 

Recently, a franchisee ended the agreement with my company. You don’t trust anymore in another person to transfer your business model. A similar company than yours showed certain interest in having its business model in that location. Your jealous because the company’s going to take advantage of your infrastructure and it’s going to be difficult to have your business there again, but you offer a different proposal: managing your business model while you emphasis in other business due to you are not having a good performance in it. And when you get more experience, and when the contract is finished, you’ll manage the business again.

:

a. Franchisingb. Management service contractc. Licensingd. All of the above e. None of the above

Looking for new foreign entry modes, you have discovered that Belgium is a good foreign market for you. Determining the entry mode has been very difficult due to the multiple competitors there. Despite that, you want to try to getting there using an intermediary who knows everything about the market. You’re going to sacrifice some profit but it is going to be useful while you penetrate by your own the market.

Which is the best foreign entry mode for the company?

_____________________________

Fortunately, Passion Fruit is achieving the goals as it was expecting. Now, there’s a new market for Passion fruit. The problem is that the company doesn’t know anything about the macro environment factors of the country. Taking into account this situation, you gave an excellent idea to the Company executive board: As Passion Fruit has enough money to invest, there are some companies there which they could be potentially attractive for the company due to those local companies have all the knowledge of the market, channel of distributions, market segmentation, among others. So with this option, Passion Fruit could enter in the market avoiding spending money in marketing research.

The FEM option you are trying to explain to the Board is: a. Greenfieldb. Acquisitionc. Licensingd. None of the above