23. State any two modes of entry into international business
Answers
Type of Entry Advantages Disadvantages
Exporting Fast entry, low risk Low control, low local knowledge, potential negative environmental impact of transportation
Licensing and Franchising Fast entry, low cost, low risk Less control, licensee may become a competitor, legal and regulatory environment (IP and contract law) must be sound
Partnering and Strategic Alliance Shared costs reduce investment needed, reduced risk, seen as local entity Higher cost than exporting, licensing, or franchising; integration problems between two corporate cultures
Acquisition Fast entry; known, established operations High cost, integration issues with home office
Greenfield Venture (Launch of a new, wholly owned subsidiary) Gain local market knowledge; can be seen as insider who employs locals; maximum control High cost, high risk due to unknowns, slow entry due to setup time
Answer:
Exporting and Licensing
Explanation:
Exporting is the direct sale of goods and / or services in another country. Licensing allows another company in your target country to use your property.