ilar companies in other countries and form a partnership. This gives the seller more recognition in the foreign country. But, it is usually more costly due to the added expense of another office. By forming a partnership with a company that is in the country you want to do business in, the partner possibly has a list of contacts, already. This makes selling the product or service a lot easier. Still though, companies wanting to expand in foreign markets must be careful in choosing their partners. If they are not careful whom they choose as a partner, they could risk losing control of their product or service. And, they need to pay close attention to the day to day activities of selling. Some small businesses get too hasty because they want to expand their market and gross profit, so they make bad judgment calls when it comes to finding a company to form their joint venture with. The third method is by using a licensing agreement. Basically, the foreign company/business buys the rights to the American product. They become the licensees. This would seem the simplest method, since the licensee, it seems, would sell the product then send you a check every month or so depending on the contract. However, you have to be careful of this strategy as well. Some licensees buy the product and then shove it back on the shelves so it wont compete with their product of the same nature. And if the contract is not worded just right, the licensee can do whatever they want with the product. The American licensor no longer has any rights or say-so as to how the product is made or sold. The last and most costly method of going global is to go it alone. This is probably not going to be an option for small American companies. But if a large company does its homework, a foreign market can be very profitable. For instance, bicycle helmet producer, Giro Sport Design Inc. of Soquel, California, did extensive research on marketing ...
