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WHY GO GLOBAL? PROACTIVE REASONS 1.Increased profits 2.Unique goods or services 3.Technological advantage 4.Exclusive market information 5.Owner-manager.

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Presentation on theme: "WHY GO GLOBAL? PROACTIVE REASONS 1.Increased profits 2.Unique goods or services 3.Technological advantage 4.Exclusive market information 5.Owner-manager."— Presentation transcript:

1 WHY GO GLOBAL? PROACTIVE REASONS 1.Increased profits 2.Unique goods or services 3.Technological advantage 4.Exclusive market information 5.Owner-manager desire 6.Economies of scale

2 WHY GO GLOBAL? REACTIVE REASONS 1. Competitive pressures 2. Declining domestic demand 3. Overcapacity 4. Proximity to customers 5. Counterattack foreign competition

3

4 GLOBAL STRATEGIES A.EXPORT STRATEGIES B.CONTRACTUAL STRATEGIES C.INVESTMENT STRATEGIES

5 EXPORT STRATEGIES 1.INDIRECT 2.DIRECT AGENT / DISTRIBUTOR 3.DIRECT BRANCH / SUBSIDIARY

6 CONTRACTUAL STRATEGIES LICENSING FRANCHISING TECHNICAL AGREEMENTS SERVICE CONTRACTS MANAGEMENT CONTRACTS CONSTRUCTION / TURNKEY CONTRACTS CONTRACT MANUFACTURE COUNTERTRADE AGREEMENTS

7 INVESTMENT STRATEGIES 1.SOLE VENTURE (a)NEW ESTABLISHMENT (b)ACQUISITION 2.JOINT VENTURE (a)NEW ESTABLISHMENT (b)ACQUISITION

8 Global Franchise Explosion Increased disposable income Rising educational levels Universal cultural trends More women entering workforce Smaller families with more incomes Enthusiasm of younger generations Demand for quality & service

9 Why Franchise? More rapid expansion at lower capital cost Motivated owner/operators Economies of scale and operating efficiencies Revenue Location Flexibility

10 Barriers to Global Franchising Culture, Culture, Culture! Location, Location, Location! Intellectual Property Protection Political/Legal Framework Availability of Raw Materials Availability of Skilled Managers Education and Training Quality Control Marketing Strategy

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