Question

surplus or deficit - How we mend the deficit. 3. Illustrate and explain all the strategies used to reach global markets (licensing, franchising, contract manufacturing, joint venture and strategic alliance, FDI)? au an example,

Answer 1

The major internationalization strategies of firms are given below,

Licensing

licensing is a course of action wherein an organization (licensor) offers the privilege to utilize intellectual property or produce an organization's product to the licensee, for loyalty. Here, the licensor has to control the intellectual property of the licensee.

Franchising

Franchising is a course of action wherein the franchisor licenses franchisee to use business model or brand name for a fee, to lead the business, as an autonomous part of the parent company (franchisor).

Contract manufacturing

Contract manufacturing is the outsourcing of part of the manufacturing procedure of an item to a third party. All the more explicitly, contract manufacturing is a redistributing of certain production activities that were recently performed by the producer to a third party.

Joint venture

Joint Venture alludes to a type of business association, set up by at least two organizations, to complete financial action. The substances which meet up in a joint venture, do not keep on working as independent companies.

Strategic alliance

Strategic Alliance infers an understanding amid at least two elements to work mutually with each other, to expand the execution of both the entities. The entities which meet up in a strategic alliance, keep on working as independent companies.

FDI

Foreign direct investment (FDI) is an investment as a controlling proprietorship in a business in one nation by an entity situated in another nation. It is hence recognized from an outside portfolio investment by an idea of direct control.