A company that has significant internal-coordination advantages should not choose franchising or licensing as a mode of entering the international market.

Question

Quizplus · Accepted Answer

Franchising or licensing primarily benefits companies looking to expand with minimal investment and risk by leveraging external partners. However, a company with significant internal-coordination advantages likely has proprietary processes, technologies, or business models that are better exploited and controlled through direct investment and operations, rather than risking dilution or mismanagement through franchising or licensing.

A Company That Has Significant Internal-Coordination Advantages Should Not Choose