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Lecture 5

GMS Week 5.docx

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Department
Global Management Studies
Course
GMS 200
Professor
Shavin Malhotra
Semester
Fall

Description
GMS Week 5 Monday, October 15, 2012 Multinational Corporations and Forms of International Business Forms of International Business  Types of market entry strategies o Non-Equity modes  Exporting  Licensing/Franchising agreement o Equity modes or Direct Investment Strategies  Joint Ventures  Mergers and Acquisitions  Greenfield Investments/Wholly owned subsidiaries Non-Equity modes: Exporting  New firms need to overcome fear  Minimizing international market and political risk  Helps to obtain knowledge Licensing/Franchising  Licensing refers to offering a firms know how or other intangible asset to a foreign company for a fee, royalty, and/or other type of payment o Advantages for the new multinational  The need for local market research in reduced  The licensee may support the product strongly in the new market o Disadvantages  Can lose control over the core competitive advantage of the firm  The licensee c
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