Issues in Global Business Essay Example | Topics and Well Written Essays - 2000 words

Issues in Global Business - Essay exampleModern franchising can perhaps go around be thought of as a method of establishment that combines large and small business into a single administrative unit. In a franchise administration one(a) large firm, frequently called the parent company, grants or sells the right to distribute its products or use its look at name and processes to a number of smaller firms2.The use of contracts in franchising also varies from the standard approaches used in domesticated operations. Because of the importance of consistency across outlets (both franchised and corporate-owned), the primary research focus of franchising has been on understanding how best to ensure that the franchisee delivers the business format service as specified by the franchisor. Typically, it is believed that this can be achieved through with(predicate) well-designed contract mechanisms such as fees and royalties. However, contracts become more difficult to monitor and enforce in the internationalist environment as a result of time and distance3. The use of standard contracts that is common in the domestic setting is less common internationally where contracts are usually modified for host country laws and heathen differences. Even the use of a contract often takes on a different meaning in the diverse cultural and legal environments of international business4. (Table 1).Finally, the importance of the foreign franchisee to overall operations relative to that of near individual domestic franchisees is often greater as well. First, in international franchising, the foreign franchisees are often major multinational firms rather than small, independent entrepreneurs. This may be a result of greater awareness by the larger host country firms regarding the franchisors business concept5. Such firms also are winning franchisees due to their strong financial position and longevity in business making them less uncertain partners in an unfamiliar business envi ronment. In Japan, Burger Kings franchise partner is Japan Tobacco, one of