Julie Ann P.

Gawat

BSBA-FM4 MTW; 6:00 PM -

7:00 PM

FM10 (Chapter 1)

SUMMARY

There are methods of engagement first, is an exporting and importing, exporting is

the selling of goods and services produced in one country in another country while
importing are goods and services that are produced in a foreign country and bought by
a country's residents. To helps us further understand MNC or Multinational Corporation
practices and strategies, and trade being the historical basis of global business,
knowledge of the trade flows in terms of the monetary amounts of imports and export
is important. Second, is a licensing, it is a business arrangement in which one company
gives another company permission to manufacture its product for a specified payment.
There are few faster or more profitable ways to grow business than by licensing
patents, trademarks, copyrights, designs, and other intellectual property to others. In
this arrangement, the licensor receives profits in addition to those generated from
operations in domestic markets, if any. The licensee benefits from obtaining the rights
to a process and acquires state-of-the-art technology while avoiding the R&D costs, and
in some cases, the cost of marketing-advertising and promotions. This is classic
example of the wheel not needing to be reinvented!. Third, is a franchising, it is a
contractual relationship between a licensor (franchisor) and a licensee (franchisee) that
allows the business owner to use the licensor's brand and method of doing business to
distribute products or services to consumers. For the franchisor, this means increased
revenues, expansion of its brand name identification and market reach. The franchisee
benefits from not having to invest in its own R&D and Marketing efforts. While they
relinquish more control on the operations than in licensing, the premise often is that
there is greater bebefit in having the "parent" company oversee those aspects of the
operations. And fourth, is the offshoring and outsourcing, the word offshoring is the
moving of various operations of a company to another country for reasons such as
lower labor costs or more favorable economic conditions in that other country while
outsourcing is when a company subcontracts some experts or professionals to perform
certain tasks. In its simplest definition, outsourcing is really about division of labour
among firms wherever they may be situated. In offshoring a company can outsource its
project, work, or task outside the country or anywhere in the world.