2:22:17 Notes.docx - Pros and Cons of Licensing Pros Low...

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2/22/17 Pros and Cons of Licensing Pros Low cost because of no capital investment Lower political risk Avoid tariffs and NTBS Less exchange rate risk Licensing can be used where FDI is not permitted Cons Give up some profits Risk to your reputation/brand image if licensee does a bad job Potential loss of intellectual property More difficult to incorporate in a strategic plan Pros and Cons of Franchising Pros Franchisee should know the local market better Less expenditure and maybe less risk o Less financial and political risk Cons Loss of control Pros and Cons of Joint Ventures Pros To fill resource gaps Sharing resources o Skills o Knowledge of the market o Financial Only joint ventures are permitted Cons Conflict between partners
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