Question

Assume a domestic company in the US, let's say Colgate-Palmolive, is deciding to export to a country where to date Colgate products are not present. Which method of entry will demonstrate lower fixed costs associated?

Answer 1

Answer:

agent method of entry

Explanation:

Agent method of entry will demonstrate lower fixed costs associated.

Answer 2

Answer: Licensing

Explanation:

Licensing can be defined as the method of foreign operation in which a company in one country(licensor) agrees to allow a company in another country(licensee) to its manufacturing, processing, trademark, know-how or any other skill.

For example, in Zimbabwe, United Bottlers have the licence to make Coke. In this case, a certain amount will be paid to the coca cola company periodically.

The advantage of adopting the licensing method of entering a new country is that, it involves little expense and involvement. In fact, the only cost incurred is during the signing of the agreement and supervising its implementation.