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I need assistance in analyzing the four approaches a company can use to expand internationally and evaluates how technology fits into each approach. To include the following:
a. Compare and contrast the four basic methods of internationalization: licensing, exporting, joint ventures, and wholly owned subsidiaries.
b. Evaluate how changes and advances in technology have served to drive the internationalization of business, including at least one example.
c. Discuss the pros and cons of each of the four methods in effecting technology transfer. The input should differentiate technology transfers designed to globalize internal business processes from technology transfers designed to deliver end products and services to new markets.

Please do not copy, cut & paste text, copy from previous postings, provide instructions on "how-to" from various internet sites, or definitions as a response. Please provide in-depth analysis, supporting facts and include relevant sources. I'm seeking expert analysis only please.

Thank you very much for your assistance. I value your input!

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a.Compare and contrast the four basic methods of internationalization: licensing, exporting, joint ventures, and wholly owned subsidiaries.

Let us first see the advantages and disadvantages of each of these methods:

Exporting: Exporting is the simplest form of internationalization as it does not involve large resource commitment and can be relatively started in a short period of time. The advantages and disadvantages of this method are as follows:


Avoids cost of establishing manufacturing operations
May help achieve experience curve and location economies


May compete with low-cost location manufacturers
Possible high transportation costs
Tariff barriers
Possible lack of control over marketing reps
Local Agent Problems


Licensing involves a contractual arrangement whereby a company licenses the rights to certain technological know-how, design and intellectual property to a foreign company in return for royalties or other kinds of payment. Licensing offers a small business many advantages, such as rapid entry into foreign markets and virtually no capital requirements to establish manufacturing operations abroad. Returns are usually realized more quickly than for manufacturing ventures.

The disadvantages of licensing include a lack of control over manufacturing, quality, and marketing. More importantly, that the licensee may become a competitor if too much knowledge and know-how is transferred. Always make sure to carefully protect your trademarks and intellectual property when undertaking any licensing agreement.

Foreign Manufacturing Joint Ventures:

In contrast to licensing arrangements, foreign manufacturing joint ventures allow for the U.S. company to have a stake and management role in the foreign operation. Joint ventures require more of a direct investment than licensing and typically include the need for training, management assistance, and technology transfer.Joint ventures can be equity or non-equity partnerships. Equity joint ventures are ...

Solution Summary

Compare and contrast the four basic methods of internationalization: licensing, exporting, joint ventures, and wholly owned subsidiaries.

See Also This Related BrainMass Solution

Expanding a brand internationally


The Real Madrid Futbol Club is thinking about expanding its brand in the United
States to build youth soccer academies and a professional franchise team, a soccer-specific stadium that will host league matches, international matches, concerts and other family entertainment operations. They are considering buying into either Major League Soccer (MLS) or United Soccer League(s) (USL) franchising systems to be located in the Phoenix metropolitan areas in Arizona.


The goal is to develop partnerships to enhance the brand value of Real Madrid in the US from the grassroots level to the professional league levels through connecting the commercial, business, youth and grassroots components and
other market opportunities.


The North American professional soccer market is a primary target for foreign soccer clubs like Real Madrid that seek to extend their brand, identify new players, produce new revenues, generate new channels of distribution, extend
and establish their global fan base, and other global branding and marketing opportunities.


Some foreign clubs have attempted to enter the North American market and have failed. A general lack of understanding and partnerships were related to not achieving desired results. Developing a brand in the U.S. is a long-term initiative that requires partners that understand the local, regional and national market, the business of sport in the US, more particularly, the business of professional
soccer/futbol, in North America.


An MLS or USL professional franchise can serve as an access point to European clubs for players from North, Central, and South America. A European club like Real Madrid can utilize the MLS or USL as a competitive platform as a proving
ground or development arm for players before moving to Europe to play at the higher levels (a farm-team or feeder-system so-to-speak). MLS and USL envision foreign clubs to directly own a franchise or at least be part of an owner/investor group that operates the franchise. Minimally, foreign clubs like Real Madrid have the opportunity to obtain a partial stake in an MLS or USL franchise where MLS and USL can provide connections for prospective franchises to affiliate and build these partnerships and expanded brand operations.


1. MLS and USL franchises contain a vertically integrated club structure that contains programs from recreational youth to the professional ranks. How would you recommend Real Madrid create formal relationships and affiliations with
major youth clubs in Phoenix that can become directly linked to the club? What would that model look like? Would it be better to develop their own youth club and academy system? Compare and contrast the two models. Defend your positions.

2. Some foreign clubs want to mitigate their risk of investment by attracting US-based partners that can operate the franchise. In other words, let one partner conduct the business side of things (i.e. stadium management and operation, concerts, other events, etc.) and let the other partner handle all soccer-related
activities (i.e. the team itself, youth development systems, etc.). What would be a compelling reason Real Madrid can offer a potential investor partner to help mitigate that investment risk? Defend your answer.

3. Some international clubs may not want to do the above, but desire to create and fully own a professional franchise in North America. What problems and challenges does this scenario present for long-term business development,
commercial activities, the grassroots movement, fan development, player development, understanding the market, other opportunities and operations? Defend your answer.

4. Foreign clubs like Real Madrid can establish a relationship in a specific market like Phoenix with opportunities for a nucleus of affiliations throughout other segments of North America. Discuss the differences between planning for
domestic and planning for international activities. What are several potential
problems Real Madrid is likely to encounter doing business in the US? Recommend possible solutions. Defend your answer.

5. Differentiate among domestic market extension orientation, multi-domestic market orientation, and global marketing orientation for the Real Madrid's case. Describe how the orientation guides international operations for Real Madrid in the US. Provide examples of new market and revenue opportunities. Defend your discussion.

Please make sure you answer these questions in an in-depth and substantive manner. Make sure you tap into leading experts' in the field, their work through publications, trade journals, industry magazines, other textbooks, and case studies, etc.

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