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done in exchange for the royalty fees. Licensing will permit SEAT ‘Minimό’ to operate in London, the United Kingdom, as it uses the property of the licensor (Plemmons,2018). Therefore, the licensee will be required to pay the fee, and this is done in exchange for the right to use the services offered by SEAT ‘Minimό.' Since little investment will be considered from the licensor, it has the potential of giving out a very large return, and this makes to be an effective method to be used by SEAT ‘Minimό’ (Bridgman,2016).However, the company should understand that since it will be the role of the licensee in London to market the services and the products offered, potential returns from marketing activities can be lost. Therefore, this entry method reduces cost and the possible risks that might occur.
International Strategic Management 11The selling of the company in the form of a contractual partnership is referred to as franchising, and the seller is referred to as the franchisor, and the company in partnership is referred to as franchisee (Baena,2012).SEAT ‘Minimό’ may also decide to sell franchises, and in this method, the franchiser is to give the foreign company right to use the brand's name and sells the mobility services to the company in London. In this case, the franchisee will be responsible for the operations and must agree to operate in compliance with the business model that was set by SEAT ‘Minimό,' who is the franchiser. In this case, the franchiser is to provide new product assistance, training, and advertisement.Therefore, franchising becomes a natural form having the expansion of the company as it continues to operate domestically as per the franchise model. In return for the services that are provided by the franchisor, then the company is to pay for the lump sum money and also share the profit earned in the future in the form of royalty payments (Bagchi,S., & Sivadasan,2017).In the franchising method, the successes of such operations are dependent on each other, even though the franchisor gains more advantages from partnership compared to the franchisee. Partnerships and Strategic AlliancesAnother method that can be used by SEAT ‘Minimό’ is having a strategic alliance with another mobility company in London. The strategic alliance calls for having contractual agreements between the enterprisers. Such agreement stipulates that the parties involved are likely to cooperate in a certain manner for them to achieve the common purpose (Ahsan & Musteen,2011).As a means of ensuring that such alliances are suitable for a SEAT ‘Minimό,' then it must determine the value that the partner can bring about to the venture when considering both intangible and tangible aspects (Ang,Benischke, & Doh,2014).The advantage that SEAT ‘Minimό’ is likely to realize as a result of a partnership with the local mobility firm in London is
International Strategic Management 12that there are possibilities of local firms highly understanding the local mobility market and mobility culture, hence can do business better than imposing outside firm.