ADMS 3960 Lecture Notes - Lecture 5: Franchising, Joint Venture, Equity Sharing
9 Dec 2017
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Document Summary
Going global - strategies , options and complications. Production costs cheaper in foreign markets than home markets. When choosing a country to expand to, factors to consider include: Government chamber of commerce (canada - chamber of commerce) Government resources e. g. (diplomatic services devoted to commercial endeavors). Liability of foreignness: phenomenon that foreign companies have lower survival rates than domestic companies. Alternative global commitments: expanding gradually into a market place. Geographic concentration: expand to only one or two countries and no further until strong presence is developed/ Geographic diversification: investing in numerous markets at the same time, gradually increase commitments in each. Equity arrangements: some percentage of ownership on the entity. Wholly owned operations - absolute ownership of an entity. Partially owned with remainder widely held: individual has a high level of ownership and the rest(remainder) is held as shares. Non equity: no ownership but just get profit from use of entity eg licensing.
