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

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

GLOBAL STRATEGIES
A. EXPORT STRATEGIES

B. CONTRACTUAL STRATEGIES

C. INVESTMENT STRATEGIES

EXPORT STRATEGIES
1. INDIRECT

2. DIRECT AGENT / DISTRIBUTOR

3. DIRECT BRANCH / SUBSIDIARY

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

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

2. JOINT VENTURE (a) NEW ESTABLISHMENT (b) ACQUISITION

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

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

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