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7/21/2019 Modes of Global Market Entry
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GLOBAL ENTRYSTRATEGIES
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DIFFERENT MODES OF MARKETENTRY
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Diferent modes o entry
EXPORTING
-indirect e!ortin"
-direct e!orts
-intr#-cor!or#tetr#nsers
$I%ENSING
FRAN%&ISING
SPE%IA$ MODES-%ontr#ctm#n'#ct'rin"-M#n#"ement%ontr#cts-T'rn(ey !ro)ects Forei"n Direct
In*estment+FDI,
oint .ent'res
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Forms o E!ortin"
Indirect
e!ortin"
Direct
e!ortin"
Intr#-cor!or#tedtr#nser
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5
Indirect involvement me#ns t/#tt/e 0rm !#rtici!#tes in intern#tion#1
2'siness t/ro'"/ #n intermedi#ry#nd does not de#1 3it/ orei"nc'stomers or m#r(ets4
Direct involvement me#ns t/#t t/e0rm 3or(s 3it/ orei"n c'stomers orm#r(ets 3it/ t/e o!!ort'nity to
de*e1o! # re1#tions/i!4
Forms o E!ortin"
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Indirect E!ortin"
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16-7
E!ortin" o "oods #nd ser*icest/ro'"/ *#rio's /ome-2#sede!orters
M#n'#ct'rers5 e!ort #"ents
E!ort commission #"ents
E!ort merc/#nts Intern#tion#1 0rms
Indirect E!ortin" 6 E"4
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Direct E!ortin"
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Intr#-cor!or#te Tr#nser
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E!ortin"
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Licensing is 3/en # 0rm7 c#11ed t/e licensor71e#ses t/e ri"/t to 'se its inte11ect'#1 !ro!erty8tec/no1o"y7 3or( met/ods7 !#tents7
co!yri"/ts7 2r#nd n#mes7 or tr#dem#r(s8to#not/er 0rm7 c#11ed t/e licensee7 in ret'rn or# ee4
The property license !"y incl#e$
P#tents Tr#dem#r(s %o!yri"/ts Tec/no1o"y
Tec/nic#1 (no3-/o3 S!eci0c 2'siness s(i11s
Licensing
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The Licensing %rocess
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9#sic Iss'es inIntern#tion#1 $icensin"
S!eciyin" t/e 2o'nd#ries o t/e#"reement
Determinin" com!ens#tion Est#21is/in" ri"/ts7 !ri*i1e"es7 #nd
constr#ints
S!eciyin" t/e d'r#tion o t/e contr#ct
E"4 Pe!sico7 %o(e 9ott1in" P1#nt
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TokyoDisneyland is
owned and
operated by a
Japanese
development
company under
license fromWalt Disney
Company
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Under franchising, an independent organisation
called the franchisee operates the business
under the name of another company called the
franchisor.
In such an arrangement the franchisee pays a
fee to the franchisor.
Franchising is a form of Licensing but the
Franchisor can exercise more control over the
Franchisee as compared to that in Licensing.
Fr#nc/isin"
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Fr#nc/isin" A"reements
Fr#nc/isee /#s to !#y # 0ed #mo'nt#nd roy#1ty 2#sed on s#1es4
Fr#nc/isee s/o'1d #"ree to #d/ere to
o11o3 t/e r#nc/isor5s re:'irements Fr#nc/isor /e1!s t/e r#nc/isee in
est#21is/in" t/e m#n'#ct'rin" #ci1ities
Fr#nc/isor #11o3s t/e r#nc/isee somede"ree o ;ei2i1ity4
E"4 McDon#1ds7 S'23#y7 KF%
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S!eci#1i=ed Entry Modes
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%ontr#ct m#n'#ct'rin"
%ontr#ct m#n'#ct'rin" is o'tso'rcin" entireor !#rt o m#n'#ct'rin" o!er#tions4
E4"4> !/#rm#ce'tic#1s7 Person#1 %#re!rod'cts etc
T/e iP#d #nd iP/one7 3/ic/ #re !rod'ctsrom A!!1e Inc47 #re m#n'#ct'red in %/in#
2y Foconn4 &ence7 Foconn is # contr#ctm#n'#ct'rer #nd A!!1e 2ene0ts rom #1o3er cost o m#n'#ct'rin" de*ices
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A m#n#"ement contr#ct is #n #"reement2et3een t3o com!#nies 3/ere2y onecom!#ny !ro*ides m#n#"eri#1 #ssist#nce7
tec/nic#1 e!ertise #nd s!eci#1isedser*ices to t/e second com!#ny or #cert#in !eriod o time in ret'rn ormonet#ry com!ens#tion4
E"4 Sc/oo1s7 s!orts #ci1ities7 /os!it#1s7o?ce 2'i1din"s7 m#11s #nd 1#r"e 2'sinesses/#*e on-site c#eteri#s7 rest#'r#nts4
M#n#"ement %ontr#ct
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A t'rn(ey !ro)ect is # contr#ct 'nder3/ic/ # 0rm #"rees to '11y desi"n7constr'ct #nd e:'i! #
m#n'#ct'rin"@2'siness@ser*ice#ci1ity #nd t'rn t/e !ro)ect o*er to t/e
!'rc/#ser 3/en its re#dy or
o!er#tion7 or # rem'ner#tion4
T'rn(ey Pro)ect
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FOREIGN DIRE%T IN.ESTMENT
A direct in*estment into!rod'ction or 2'sinessin # co'ntry 2y #nindi*id'#1 or com!#ny in#not/er co'ntry7 eit/er2y 2'yin" # com!#ny int/e t#r"et co'ntry or 2ye!#ndin" o!er#tions o
#n eistin" 2'siness int/#t co'ntry
Mer"ers #nd #c:'isitions
&&
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'erger $ T/e com2inin" o t3o or morecom!#nies7 "ener#11y 2y oferin" t/estoc(/o1ders o one com!#ny sec'rities in
t/e #c:'irin" com!#ny in ec/#n"e or t/es'rrender o t/eir stoc(4
Ac(#isition $ /en one com!#ny t#(es o*er
#not/er #nd c1e#r1y est#21is/ed itse1 #s t/e ne3o3ner7 t/e !'rc/#se is c#11ed #n #c:'isition4
&DF% 9#n( #c:'isition o %ent'rion 9#n( oP'n)#2 or BC4 2i11ion
Mer"ers #nd Ac:'isitions
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A )oint *ent're is #n entity ormed 2et3eent3o or more !#rties to 'ndert#(e economic#cti*ity to"et/er4 T/e !#rties #"ree to cre#te
# ne3 entity 2y 2ot/ contri2'tin" e:'ity7#nd t/en t/ey s/#re in t/e re*en'es7e!enses7 #nd contro1 o t/e enter!rise4
Sony-Ericsson is # )oint *ent're 2y t/e
#!#nese cons'mer e1ectronics com!#nySony %or!or#tion #nd t/e S3edis/te1ecomm'nic#tions com!#ny Ericsson tom#(e mo2i1e !/ones
oint .ent'res
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T&ANK YO