International Business Organizations Section 3-3

Multinational Companies (MNC) Do business in several countries Home country Divisions or separate companies Host countries

MNC Strategies Same product Same marketing strategy Example: Coca-Cola Global Strategy Multinational Strategy Same product Same marketing strategy Example: Coca-Cola Each country is considered different Adapts to the consumer Customs Tastes Buying Habits

Global Entry Methods Licensing Franchising Joint Venture

Licensing Selling the right to use an intangible property for a fee or royalty Such as Production process Trademark Brand Name Example: Gerber Baby Food in Japan Low Risk → Low Return

Franchising A company is set up to look and run like a parent company What are some examples of franchises? What are the benefits to a franchise? Limited Risk → Limited Return

Joint Venture Agreement between two or more companies to share a business project Why would this be used? Share Raw Materials Shipping Facilities Management Activities Production Facilities Ford and Mazda

This Joint Venture Looks INTELliGEnt What two companies are starting a joint venture? What is the goal of the joint venture? What are the two companies combining? Is the joint venture a good idea? Why or why not?

World Trade Organizations (WTO) Promotes Trade Settles trade disputes Enforces free-trade agreements Lowers tariffs Eliminates quotas Reduces barriers Assists poor countries

International Monetary Fund (IMF) 150 member nations Stabilizes world trade and exchange rates

World Bank Provides economic aid to less developed countries

Pop Quiz What are the three global entry methods? What is a joint venture? How much risk does a franchise have? How many nations are part of the IMF? List 3 things that the WTO does?

Dlabay, Burrow and Eggland. Intro to Business 6e Dlabay, Burrow and Eggland. Intro to Business 6e. Mason, OH: Thompson South-Western, 2006.