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Global Frontier Inc. wants to expand into the international market. It does not want to spend a very large amount of money for this process. However, Global Frontier wants to maintain some control in the foreign market. Which of the following would be the best entry mode for this firm?

1) Exporting
2) Licensing
3) Franchising
4) Joint venture

1 Answer

6 votes

Final answer:

The best entry mode for Global Frontier Inc., which wants cost-efficiency and control, is franchising, offering a balance between support and autonomy.

Step-by-step explanation:

If Global Frontier Inc. wants to expand into the international market while not spending a large sum of money and still maintain some control, then the best entry mode would be franchising. Franchising allows a firm to purchase the rights to start a business based on a model designed by the franchisor, who typically provides essential support such as training and supply chain assistance. In this arrangement, the franchisee maintains some degree of control and managerial responsibility, can have a more long-run focus compared to portfolio investments, but does not require the level of investment and risk associated with foreign direct investment or a joint venture.

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