How Can A Company Use Licensing Agreements To Enter World Markets

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How Can A Company Use Licensing Agreements To Enter World Markets

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By licensing, a company can negotiate an agreement that entitles it to produce or market another company's product in return for a royalty or fee. The company that obtains the license is responsible for the product quality, promotion, and distribution, and it must pay the other company a percentage of its sales. On the other hand, the company that grants the license avoids shipping costs, trade barriers, and other problems associated with international trade, while still receiving a portion of the revenue from overseas sales.

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