Erna boogard bakes cakes for a living. her recipes were so popular in the netherlands that her company has grown dramatically. she has just sold the right to manufacture her cakes to to firms in canada and the us. which of the following ways of entering into the global marketplace is erna's company using?

a. licensing

b. franchising

c. exporting

d. joint ventures

It is Franchising (B)

Explanation:

Option (A) False.

Licensing is  contractual  transaction  where  the  company (licensor) offers  some  proprietary  assets   to  foreign company (licensee) in exchange for royalty fees .

Licensing  is considered a low involvement and low-control entry strategy, since it does not necessarily entail equity participation, and because control over operations and strategy is granted to the licensee in exchange for a lump-sum payment,   and  a  commitment  to  abide  by  any  terms  set out  in  the  licensing  contract.

Option (B) True.

A franchise agreement is a contractual arrangement between two independent firms, whereby the franchisee pays the  franchisor  for  the  right  to  sell  the  franchisor's  product  and/or  the  right  to  use  the  franchisor's  trademark  at  a given place and for a certain period  of time.

Franchisors  typically   offer   managerial  assistance and exercises  substantial  control  over the franchisee.

Option (C) False

Exporting- here the  company  becomes  directly  involved  in  marketing  its  products  in  foreign  markets.  Although  the associated cost  and  risks  are  greater,  so are the profits too ,all things being equal.

Option (D) False

This is when two or more independent companies create a separate entity but still still maintain their former entity . As a penetration strategy, it does not only reduced risks but also decreases individual involvement.

It can also be used to eliminate risk of entry barriers for a new entrant in an existing market.

answer; (cash) is the best out of the above; good luck

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