Question

Leonards, a leading French garment manufacturing company, is looking for ways to go global. Penny, a designer from California, wishes to open a fashion boutique in the neighborhood, and gain production expertise and name without having to invest significantly. She learns about Leonards' global expansion plans, and buys the right to use its manufacturing process for a royalty fee. This allows it to gain entry into a foreign market at little risk. Leonards has used the ________ method of entering a foreign market.

Answer 1

Answer:

licensing

Explanation:

A licensing agreement between Leonards and Penny will enable Penny to use Leonards' proprietary assets for a defined time period. In exchange Penny must pay royalty fees to Leonards. The license will allow Penny to manufacture and sell Leonards' products in California (or the whole US). This licensing agreement will save money and resources to both Loenards and Penny.