Pandy's, a U.S. restaurant chain, promotes its business in the U.K. by offering buyers the rights to open and operate the restaurant in their own country. It offers financial and marketing assistance to the buyers. Pandy's is using the strategy of _____.
A) foreign franchising
B) foreign export performance
C) foreign outsourcing
D) foreign direct investment

Question

Quizplus · Accepted Answer

Pandy's is using the strategy of foreign franchising, which involves giving the rights to operate the restaurant in another country to a buyer (the franchisee), who will pay an initial fee and ongoing royalties in exchange for using the franchisor's business model, brand, and support. This allows Pandy's to expand its business in another country without making a foreign direct investment or exporting its products.