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Definition
refers to the offering of a companys know-how or other intangible assets to another company for a fee, royalty, or other type of payment
-manufacturers more likely to use
-large scale
-decentralized |
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Definition
| receives financial gain and opportunity to have greater visibility for its retail concept |
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Definition
| obtains use of licensors proprietary knowlege- may eventually become competitor |
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Definition
-loss of contol and acountability over:
company is giving up its most important asset-its name
-little protection to the licensor |
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Term
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Definition
type of licensing arrangement that provides the seller with greater control over the retail format
-a FRANCHISE is the right to operate a business under a companys name |
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Definition
| selling the right to a proven way of doing business |
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Definition
buying the right
-may receive total system for conducting business, including how to recruit and train |
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Definition
given to an individual store owner. each application is considered separately.
-advantage- it is more likely to consist of owner-operators who will run the store with more care than hired managers |
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Definition
given to an individual who is then given the right to develop a particular state, country, or region.
-given right to sublease franchise |
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Definition
| a combination of company-owned stores and franchised outlets. by having own stores, they can benchmark productivity of franchise outlets |
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Definition
| means that they use the outlets as a basis for comparison. |
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Definition
| business relationship between 2 or more companies who cooperate out of mutual need and to share risk in achieving a common objective |
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Term
| companies involved in a strategic alliance determine: |
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Definition
-common objectives exist
-one partners weakness is offset by others strength
-reaching objectives alone too costly, too much time, or too risky
-together their respective strengths make possible what otherwise would be unattainable |
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Term
| 3 necessary characteristics of SA |
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Definition
1. horizontal (partners in alliance must be at the same channel level. ex ret-ret)
2. collaborative (alliance based on mutually defined objectives. not dictated from stronger channel member to a weaker one)
3. mutually beneficial (benefits occur for all of the participants |
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Term
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Definition
1. create new retail companies in another country with a local retailer as partner
2. enhance purchasing power
3. facilitate exchange of knowledge or know-how |
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Definition
| include a cross shareholding between members |
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Definition
involve collaboration in business activites that can be mutually beneficial, such as cooperative buying groups, branding, expertise exchange, and product marketing
-generally have central office to administer work |
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Term
| risk of strategic alliances |
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Definition
-uncertain control
-slow decision making
-potentially unstable
-may lose technology to competitors
-requires complex and detailed contracts
-difficult to manage
-interests of local partner may conflict with global strategies of global firm |
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Term
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Definition
(risk of SA)
potential partners misrepresent value of skills and abilities they bring to alliance |
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Definition
(risk of SA)
skills and abilities of partners lower quality than promised |
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Definition
(risk of SA)
partners exploit transaction-specific investments made by others in alliance |
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Definition
formed when two or more retialers come together to create a new enterprise "new entity"
-must have 3 characteristics of SA |
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Term
would we expect global or multinational retailer to license?
why? |
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Definition
-multinational
-licensing does not include method of operation, so decisions made at store level
-multinational has decentralized management |
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Term
would we expect global or multinational retailer to franchise?
why? |
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Definition
-global
-franchising includes method of operation, so major decisions made centrally
-global has centralized managment, so decisions made at corp. |
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Term
| three perspectives explaining franchising |
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Definition
1.to extend limited resources
2. to improve administrative efficiency (derives from agency theory-predicts that indiv. who own their own stores will be more likely to perform higher)
3. provide risk management |
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Definition
| means that franchiser can take money out of country |
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Definition
limied international management capabilities and little capacity for learning.
-company not likely to pursue significant inter franchise devel |
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Definition
have limited international franchising capabilities but considerable capacity for learning from experience and integrating exper. into operations
-more likely to initiate int. expansion |
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Term
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Definition
have some capabilities needed for international expansion but do not have a great ability to develop what is needed to suceed in broader global setting
-find themselves in less ideal locations |
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Term
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Definition
generally larger retailers with a greater amount of experience and greater capabilities in both administrative efficiency and host country risk management
-operate in many contries |
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