Class Notes (834,243)
Canada (508,433)
York University (35,141)
ADMS 3930 (66)
Hendriks (2)
Lecture

ENTRY MODES OF INTERNATIONAL EXPANSION.docx

3 Pages
132 Views
Unlock Document

Department
Administrative Studies
Course
ADMS 3930
Professor
Hendriks
Semester
Summer

Description
ENTRY MODES OF INTERNATIONAL EXPANSION - Exporting  Producing goods in one country to sell in another  Enables a firm to invest the least amount of resources in terms of its product, organization and corporate strategy  Disliked by host countries because it provides less local employment than other modes  Partner with local firms while minimizing their own risk  Firm gives control of strategic marketing decisions to local partners  Relatively inexpensive way of entering foreign markets  May be bought out by local multinationals  Successful distributors: 1. Carried product lines that complimented, rather than competed with, the multinational’s products 2. Behaved as if they were business partners with the multinationals  Important to develop collaborative, win-win relationships - Licensing  Enables a company to receive a royalty fee in exchange for the right to use its trademark, patent, trade secret, or other valuable item of intellectual property  Firm generating the license incurs little risk; the country also benefit from the product being manufactured locally  Disadvantages:  Licensor gives up control of its product and forgoes potential revenues and profits  Licensee may become so familiar with the patent and trade secrets that it may become a competitor; the licensee may make some modifications to the product and sell it independently  If the licensee selected by the multinational firm turns out to be a poor choice, the brand name and reputation of the product may be tarnished - Franchising  Includes a broader range of factors in an operation and involves a longer period  Limit risk exposure that a firm has in overseas markets while expanding revenue base  Multinational firm receives only a portion of the revenues (franchise fees) - Strategic Alliances and Joint Ventures  Strategic alliances can take many forms, including joint research and development, joint exploration initiatives, joint production, or co- distribution of two partners’ products  To produce a product for the local market, using the multinational’s technology and brand name but the local firm’s management and market knowledge  Multinational retains substantially more control over the strategic and operational decisions  Joint ventures—unique form of strategic alliance that entail the creation of a third legal entity, owned by the partners, with a clear mandate and separate organizational structure  Enable
More Less

Related notes for ADMS 3930

Log In


OR

Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


OR

By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.


Submit