《I-Marketing》 南京大学mkt9.ppt

INTERNATIONAL MARKETING 6e Export Intermediaries, Licensing, and Franchising Licensing Licensing is one form of foreign market entry More engaging than exporting Less risky than foreign direct investment Could cause lose of product control It has proponents and opponents Licensing The licensor permits the licensee to use its intellectual property (an intangible) in exchange for a royalty payment. Advantages of licensing No capital investment, knowledge, or marketing strength Huge profit potential, recovered costs Minimal risk of government intervention A stage in internationalization Preempt market entry before competition Increasing intellectual property rights protection Licensing Disadvantages of licensing Licensee controls marketing function and licensor does not gain expertise in local market No guarantee of entry after license expires Licensee may become local and international competitor of licensor No extension of license permitted by local government Licensee may create quality control and marketing problems for licensor Issues in Negotiating Licensing Agreements Rights conveyed to licensee Product and/or patent rights Compensation paid to licensor Transfer costs for technology and maintaining the agreement RD costs for developing the technology Opportunity costs for exports or investments Methods of compensating the licensor Running royalties (percentage of sales) Up-front payments, service fees Issues in Negotiating Licensing Agreements Compliance by licensee Export control regulations Confidentiality of the intellectual property and technology provided Record keeping and provisions for licensor audits Dispute Resolution The choice of law for contract interpretation Third country or arbitration The choice of legal forum Termination Government regulations in the licensee’s market will determine these terms. Trademark Licensing Companies trade on their names and characters as a substantial source of worldwide revenue Franchising A licensing arrangement