There are four main strategies to internationalize a company, we briefly summarize the concept of each one for you:
Export: the process of internationalization of Brazilian companies is the most popular way of operating in foreign markets. Its advantages are:
• Requires the lowest amount of capital;
• Low level of risk;
• The company easily adjusts to markets and competition abroad.
Franchising
The company chooses to be a franchisee, having to pay a small fee and royalties to the franchisor. Once it owns the trademark, the organization is allowed to sell products and services, in addition to using the franchise’s business format and system.
Investing in a franchise means that you will be licensed to handle another company’s business system. Realize that the option belongs to those organizations that want to act internationally and believe that they can be more successful using someone else’s brand and operating according to their systems and methods.
Joint venture
It is an economic association between two or more companies, from the same or different branches, which pool resources to perform a specific task, during a determined and, therefore, limited period.
Direct Investment
This form of internationalization has two possibilities:
Total or partial acquisition of an existing commercial entity in a foreign market or the creation of a new company to carry out commercial activities abroad.
The main characteristic of this modality is that it will come from an investment that establishes effective control over the decision-making of a foreign business.
Direct investments as a form of internationalization can take place through:
• Opening of a subsidiary or associated company in a foreign country;
• Controlling interest in an existing foreign company or
• Through a merger or joint venture with a foreign company.
