Licensing
Licensing can be defined as a strategy of foreign marketing whereby a company operating in a certain country agrees to allow a company in a different country to apply its manufacturing methods, processes, brand name, copy rights, technology and any other know-how offered by the company (licensor). This kind of arrangement is increasingly being used by many smaller companies (Hitt, Ireland & Hoskisson, 2009, p. 225). Licensing involves minimal risks since the parent company does not invest a lot in the business. It is difference with contract manufacturing is that it’s normally lasts longer periods and gives the local partner greater duties. Licensing has great similarities with franchising; only that in franchising, the parent company seems to directly participate in the formulation and control of the business.