Licensing, Franchising, and Other Contractual Strategies in International Business
Overview
This presentation chapter examines contractual entry strategies in international business, focusing on licensing and franchising as mechanisms for cross-border exchanges. It defines key concepts including intellectual property, royalties, and contractual relationships, while outlining the advantages, disadvantages, and unique aspects of using contractual arrangements as foreign market entry strategies.
What this presentation covers
- Learning objectives covering contractual entry strategies, licensing, franchising, and intellectual property infringement
- Foundation concepts defining contractual entry strategies and intellectual property types
- Contractual relationships including licensing, franchising, and royalty structures with unique aspects and flexibility
- Typical types of intellectual property including patents, trademarks, and copyrights
Preview
International Business: The New Realities
Fifth Edition
Chapter 15
Licensing, Franchising, and Other Contractual Strategies
Slides in this presentation contain hyperlinks. JAWS users should be
able to get a list of links by using INSERT+F7
Copyright © 2020 Pearson Education, Inc. All Rights Reserved
Learning Objectives
- 15.1 Explain contractual entry strategies.
- 15.2 Understand licensing as an entry strategy.
- 15.3 Describe the advantages and disadvantages of licensing.
- 15.4 Understand franchising as an entry strategy.
- 15.5 Explain the advantages and disadvantages of franchising.
- 15.6 Understandothercontractualentrystrategies.
- 15.7 Understandinfringementofintellectualproperty,aglobal problem.
Copyright © 2020 Pearson Education, Inc. All Rights Reserved
Foundation Concepts
• Contractual entry strategies in international business: Cross-border exchanges in which the relationship between the focal firm and its foreign partner is governed by an explicit contract.
• Intellectual property: Ideas or works created by firms or individuals, such as patents, trademarks, and copyrights. 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”.
Copyright © 2020 Pearson Education, Inc. All Rights Reserved
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.
• Franchising: Arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties or other compensation.