Question

In the context of foreign market entry strategies, the advantages of _____ are most apparent when capital is scarce, import restrictions forbid other means of entry, a country is sensitive to foreign ownership, or patents and trademarks must be protected against cancellation for nonuse.

Answer 1

The advantages of licensing or franchising in foreign market entry strategies are most apparent when capital is scarce, import restrictions forbid other means of entry, a country is sensitive to foreign ownership, or patents and trademarks must be protected against cancellation for nonuse.

Step-by-step explanation:

The advantages of licensing or franchising are most apparent when capital is scarce, import restrictions forbid other means of entry, a country is sensitive to foreign ownership, or patents and trademarks must be protected against cancellation for nonuse.

Licensing is when a firm in one country grants the rights to another company in a different country to produce and sell its products, while franchising is when a company grants rights to another company to use its brand and operating model in exchange for fees and royalties.

For example, if a company has limited capital but wants to expand into a foreign market, they can license or franchise their products or brand to a local company that has the resources and knowledge to operate in that market.