Question

In the context of foreign market entry, when is licensing least suitable?

1) When capital is scarce
2) When there is a lack of expertise
3) When there are high entry barriers
4) When there is a need for tight control over operations

Answer 1

Licensing is least suitable in foreign market entry when there is a need for tight control over operations.

Step-by-step explanation:

In the context of foreign market entry, licensing is least suitable when there is a need for tight control over operations. Licensing involves granting permission to another party to use your intellectual property, such as trademarks, patents, or copyrights, in exchange for payment or royalties. When a company wants to maintain tight control over its operations, such as maintaining a consistent brand image or protecting trade secrets, licensing may not be the best option.