Chapter 3 part 4 (5 Forms of International Business Activity)
International alliances and joint ventures
-Are long-term partnership between two or more company to jointly develop, produce or sell products. To reach the global marketplace. -Which two or more firms join together to create a new business entity that illegally separate and distinct from it's parents.
5 Forms of International Business Activity
-Importing and Exporting -International Licensing -International Franchising -International alliances and joint ventures -Foreign direct investment
Multidomestic strategy
A decentralized approach to international expansion in which a company creates highly independent operating units in each new country
Global strategy
A highly centralized approach to international expansion, with headquarters in the home country making all major decisions
Transnational strategy
A hybrid approach that attempts to reap the benefits of international scale while being responsive to local market dynamics
International Licensing
Agreement to produce and market another company's product in exchange for a royalty or fee
Multinational Corporations (MNCs)
Companies with operations in more than one country
Foreign direct investment
Investment of money by foreign companies in domestic business enterprises
International Franchising
Involves selling the right to use a business system. And to expand into foreign market.
Strategic Approaches to International Markets
Multidomestic strategy Global strategy Transnational strategy
Functional Strategies for international expansion
Products Customer support Promotion Pricing Staffing
Importing and Exporting
Purchasing goods or services from another country and bringing them into one's own country Selling and shipping goods or services to another country