ADMS 1000 Lecture Notes - Lecture 8: Foreign Direct Investment, Future Shop, Multinational Corporation

• School: York University
• Department: Administrative Studies
• Course: ADMS 1000
• Professor: Len Karakowsky

Document Summary

Selling/buying goods and services from abroad, either directly to target customers or indirectly by retaining foreign sales agents and distributors. Avoid the need to build factories in host country. They are relatively quick ways of going international. Contracting services from foreign-based businesses (eg. nike) Avoids the need to build factories in host country (eg. access to cheap labour reduces cost of production versus using domestic labour in canada or u. s. Licensing is an agreement where the licensor or exporter grants a foreign firm the right to use intellectual property. For example, patents, copyrights, manufacturing processes, trade names etc. for royalties a percentage of total earnings. Franchising involves drafting a contract between a supplier (franchiser) and a dealer (franchisee) that stipulates how the supplier"s product or service will be sold. The franchisee is the dealer who is permitted to sell the goods/services of the franchiser in exchange for some payment.